Financing Long‐Term Services and Supports: Ideas From Singapore

Abstract

Policy Points: In Singapore, long‐term services and supports (LTSS) are financed through a mix of public and private sources comprising tiered means‐tested public subsidies and government grants to care providers, charitable donations, voluntary long‐term care insurance, and other private resources.Singapore's high take‐up rate of voluntary long‐term care insurance is explained by plans offering partial coverage, medical underwriting, early automatic enrollment, direct debit of insurance premiums, and defined cash benefits.Singapore's experience in long‐term care financing is relevant to the US debate, as it provides policy ideas that may be transferable to the American context.We recommend maximizing the population's total contribution to voluntary long‐term care insurance by striking the right balance between coverage adequacy and take‐up rate while targeting subsidies to low‐income individuals. ContextFinancing long‐term services and supports (LTSS) for the elderly is a pressing issue in the United States with reforms of long‐term care insurance (LTCI) presently being explored. Singapore, with 65% of residents aged 40 to 83 covered by basic LTCI, including 22% with supplementary LTCI plans, has the highest voluntary LTCI rate in the world. This article contributes to the discourse by presenting the case of LTSS financing in Singapore.MethodsWe first reviewed Singapore's LTSS policies through a comprehensive search of academic papers, governmental reports, parliamentary debate transcripts, print media, and official websites of LTSS providers. We then estimated the LTSS financing mix, conducted an in‐depth analysis of the main policies, and illustrated the financial protection they procure for the elderly using realistic hypothetical scenarios.FindingsThe main principles governing Singapore's LTSS policies are shared responsibility for long‐term care financing, targeted assistance for the poor, centralized governance and administration, separation from other income and housing policies, and limited intergenerational cross‐subsidizing. We estimate the financing mix to consist of out‐of‐pocket spending (40%), government spending (42%), long‐term care insurance (9%), and charitable donations (9%). Assuming a monthly LTSS bill of US$1,545 to US$2,575, between 11% and 19% of LTSS expense is offset by LTCI for severely disabled individuals with basic coverage. Overall, 63% of care recipients are eligible for public subsidies that amount to 20% to 80% of their expenses.ConclusionsThe high take‐up of voluntary LTCI in Singapore is explained by the high prevalence of plans offering partial coverage, medical underwriting, early automatic enrollment, direct debit of insurance premiums, and defined cash benefits. We recommend setting the coverage of voluntary long‐term care insurance plans at levels that maximize the population's total contribution by striking the right balance between coverage adequacy and take‐up rate while targeting subsidies to low‐income individuals.

An Analysis of Good Governance in the Health System

“…In this regard, in recent years, changes have been made in the health system of many countries which have led to the satisfaction of patients. For example, the existence of the Australian patients' rights advocacy council, ongoing monitoring, evaluation, response to patient needs and their preferences in most of the political documents and reports of health system of Turkey after the implementation of the health promotion plan in the country (20) and patient surveys to assess their satisfaction and expectations about public health care institutions in Singapore (21).…”

Exploring the dimensions of patient experience for community-based care programmes in a multi-ethnic Asian context

“…This could be due to cultural factors and differences in configurations of healthcare systems. Both Singapore and China have a healthcare system that necessitates a certain level of out-of-pocket payment for health services utilisation [58][59][60][61][62]. From a cultural perspective, Chinese patients might exercise a more frugal mentality than their Western counterparts when it comes to any form of expenditure and healthcare is no exception [63].…”

Political and Cultural Foundations of Long-term Care Reform Comment on "Financing Long-term Care: Lessons From Japan"

“…Other private-public mixtures of LTC financing, like the savings accounts in Singapore, could also be considered. 22 The point is that the cultural tension between the formal system and traditional values should be the concern of countries where societies share these familial values.…”