Effective Healthcare+Increasing Longevity+Low Yields = Million Dollars Also No Enough

A juxtaposition of two articles and themes, soon to become a looming concern with the coming silver tsunami…
[a Japanese Hokusai print with huge looming silvered tidal waves will be very appropriate here]


June 7, 2013 5:30 pm
Thank you, Singapore
By Gillian Tett

The country’s healthcare system is not just lowcost but also very effective in terms of saving lives

A decade ago, I had an experience that left me profoundly grateful to Singapore’s healthcare system. During a work trip to the island state, I was suddenly taken ill and succumbed to a rare variety of meningitis. In many countries, I would have died but two extraordinary things occurred. First, a work colleague had a strange premonition that something was wrong and came to my hotel room, where she found me sliding into a coma. Second, the colleague then had me rushed to a local hospital, where Singaporean doctors identified the problem with astonishing efficiency and then took a bold medical gamble to save my life. (Essentially, they injected every type of antibiotic they possessed directly into my heart because they did not have any tailored way of treating the rare strain of meningitis I had.)

When that risky gamble pulled me out of the coma, the hospital staff set me on the long path to rehabilitation, with further efficiency and grace. And, a few months later, came another surprise. When I stumbled on some of the paperwork between the hospital and my insurance group, I noticed that the bill for the intervention was not that large. “If this had happened in America, it would be many times that size,” a colleague later grimly remarked in New York. (To which I retorted that if the incident had happened in America, I might not have survived at all since litigation risk might have deterred the doctors from engaging in that antibiotic gamble.)

But in recent weeks I have been flicking through a fascinating ebook, Affordable Excellence, that an American scientist friend, William Haseltine, has written about Singaporean medicine for the Brookings Institution. And this leaves me convinced that I have even more reasons to say “thank you” to Singapore than I realised at the time. For if Haseltine is correct, Singapore’s healthcare system is not just low cost but also very effective in terms of saving lives – both during emergencies and in less dramatic cases too.

The statistics are striking. At present, America spends about 18 per cent of its gross domestic product on healthcare, more than any other western nation. […] Singapore’s healthcare costs, by contrast, are just 4.6 per cent of its GDP; and while the system is based on insurance programmes, premiums per capita are just 2 per cent of those paid by Americans. But on issues such as life expectancy, infant mortality, premature adult death – and, yes, emergency care – Singapore produces much better outcomes.

But the main weapon for lowering costs is consumer pressure: hospitals are forced to publish prices for medical procedures and outcomes so that consumers can quickly compare them. Patients are always forced to co-pay for treatment, alongside insurance groups, to create incentives to scrutinise their bill.

Not going to go into a debate between Universal Healthcare versus Pay-as-you-go/Co-paying. Have already had many of these discussions, even with Taiwanese friends who warned soberly that the much-vaunted taiwanese universal healthcare system is not without its ills and after a near 20-year run of superlative performance, escalating costs are now showing up the cracks in the system. No one solution is perfect or even suitable for all periods of time; generational, demographic, economic shifts and changes are always on-going, and the perfect system for one generation/time period can be disastrous for the next.

But I did have a very interesting dinner conversation recently with a close family member who is well-placed and informed about these matters, especially in our local context; a management consultant leading a so-called human capital/talent management consulting practice, with a personal specialization in health & benefits/insurance. [Whose team advises government agencies on these same issues. Shhh…]

[But the irony was when I picked her up (Asia Square is really ‘nice’: left the car at the long expansive driveway {everyone was doing it!} to check out the large green plaza and to pick up a quick coffee while waiting for her. Came back to find a traffic police summons on the windscreen. Bummer.) for our dinner appointment, she flung herself into the car in a huff and started on a litany of complaints about her senior partner bosses and discrimination and being stonewalled again for promotion to the coveted partner level/position. Apparently, for her appointment grade -Practice Leader-, her domain experience, the large regional team she manages, and most importantly, the amount of business she brings in, she is long overdue for the partner position. Doesn’t help that the country heads are apparently parachuting in under-worked consultants and ‘co-leaders’ from the States and London offices to help ‘share’ her team’s workload, but who do not have the required expertise or experience, and who arrive in Spore on generous expat terms and benefits; and all on her team’s budget and numbers, which dilutes her overall profit performance (she has responsibility for revenue and profit targets). More stories of how she would like to fill several senior analyst (considered junior to mid-level) positions on her team and was interviewing very qualified local candidates with the right experience in the industry with other consulting firms; but her senior partners wanted her to hire fresh graduates from US and UK at higher salaries and with housing benefits. Pretty blatant discrimination. This from a consulting firm larger and regarded even more highly than McKinsey or Bain. And which was lauded by our government as an employer with very progressive and equal opportunity HR practices. Guess they don’t take the same consulting advice they dish out to their clients.

But this digression and rant really belongs to another post, regarding ‘Foreign Talent’.

And the next article…


Why many retirees could outlive a 1 million nest egg
Published: June 8, 2013

A MILLION dollars isn’t what it used to be.

$1 million is more money than 9 in 10 American families possess. It may no longer be a symbol of boundless wealth, but as a retirement nest egg, $1 million is relatively big. It may seem like a lot to live on.

But in many ways, it’s not.

Inflation isn’t the only thing that’s whittled down the $1 million. The topsy-turvy world of today’s financial markets — particularly, the still-ultralow interest rates in the bond market — is upending what many people thought they understood about how to pay for life after work.

“We’re facing a crisis right now, and it’s going to get worse,” said Alicia Munnell, director of the Center for Retirement Research at Boston College. “Most people haven’t saved nearly enough, not even people who have put away $1 million.”

For people close to retirement, the problem is acute. The conventional financial advice is that the older you get, the more you should put into bonds, which are widely considered safer than stocks. But consider this bleak picture: A typical 65-year-old couple with $1 million in tax-free municipal bonds want to retire. They plan to withdraw 4 percent of their savings a year — a common, rule-of-thumb drawdown. But under current conditions, if they spend that $40,000 a year, adjusted for inflation, there is a 72 percent probability that they will run through their bond portfolio before they die.

But for savers, low rates have been a trial. The fundamental problem is that benchmark Treasury yields have been well below 4 percent since early in the financial crisis. That creates brutal math: if your portfolio’s income is below 4 percent, you can’t withdraw 4 percent annually, and add inflation adjustments, without depleting that portfolio over time.

And with rising life expectancies, many people will have a lot of time: the average 65-year-old woman today can be expected to live to 86, a man to 84. One out of 10 people who are 65 today will live past 95, according to projections from the Social Security Administration.

Frightening actually. Especially the ‘live past 95’ part.
And to relieve the dour mood a little, especially since there is yet another medical appointment to ‘look forward’ to tomorrow (full cash payment! no insurance), here is the evergreen and ever funny Money No Enough (1998).

Money No Enough (1998) – Singapore film:

*Guffaws…I can’t help it. The dialogue gets to me every time…

(Ai Kok, literal translation, Patriotic): I am very disappointed with your attitude.

(Jack Neo, while still on phone): Then what do you think Singaporeans should do?

(Ai Kok the Patriot, getting excited): If we can…An eye for an eye, a tooth for a tooth. They burn our flag, we burn their flag! To show that Singaporeans are also very patriotic! Burn their flag!

(Mark Lee, cigarette between fingers and shaking leg, a typical Ah Beng or the equivalent of an American redneck): Burn their flag? You’re crazy!
Government never ask us to burn, we don’t burn.
Government ask us to burn, then we burn.
Burn flags, tsk…I’d rather go burn joss paper better! (pray to the gods for luck in gambling) Harrumph!

The context of the conversation above is of course regarding the Michael Fay vandalism and caning incident, and the brouhaha it caused in the US then, especially among the US patriots and rednecks burning Sporean flags.

And for those who can’t keep up with the movie’s dialogue and subtitling, the rapid-fire interchanging between several languages… well, a typical Sporean (at least for the older generation) uses and translates in his head several regional languages and chinese dialects in his daily life.

And the themes of money and moribund economy in this 1998 movie have to be understood in the context of the Asian financial crisis which was then affecting most regional economies, including Spore, though to a far lesser degree.

[Both articles above coming by way of Taichiseal‘s shared Pinboard items.]


One thought on “Effective Healthcare+Increasing Longevity+Low Yields = Million Dollars Also No Enough

  1. This piece of news came up on the streaming news ticker. Sorta relevant to the two articles posted above.


    Cash-only doctors abandon the insurance system
    Health advocates worry only the wealthy will benefit from system

    Author: By Steve Hargreaves
    Published: Jun 11 2013

    Fed up with declining payments and rising red tape, a small but growing number of doctors is opting out of the insurance system completely. They’re expecting patients to pony up with cash.

    Some doctors who have gone that route love it, saying they can spend more time with and provide higher-quality care to their patients. Health advocates are skeptical, worrying that only the wealthy will benefit from this system.

    The office has negotiated deals for services outside the office. By cutting out the middleman, Nunamaker said he can get a cholesterol test done for $3, versus the $90 the lab company he works with once billed to insurance carriers. An MRI can be had for $400, compared to a typical billed rate of $2,000 or more.

    Nunamaker encourages his patients to carry some type of high-deductible health insurance plan in case of an emergency or serious illness. But for the everyday stuff, he said his plan works better for both doctor and patient.

    Kevin Petersen, a Las Vegas-based general surgeon, stopped taking insurance in 2005. Petersen named the same reasons as Nunamaker: too much paperwork and overhead, declining payments from insurance companies, and a general loss of control.

    “The insurance industry took over my practice,” he said. “They were telling me what procedures I could do, who I could treat — I basically became their employee.”

    Now Petersen does hernia operations for $5,000 a pop, which includes anesthesia, operating room time and follow-up visits. He negotiates special rates for the anesthesiologist and the operating room, and is able to provide the service for about a third of what a patient might pay otherwise.

    Many of his patients are early retirees who are not yet eligible for Medicare but can’t afford a full-fledged health insurance plan, he said, and business is booming.

    While the cash-only model may please doctors, some question whether it’s good for middle- and low-income people.

    Kathleen Stoll, director of health policy at the consumer advocacy group Families U.S.A., didn’t want to speak directly to either Petersen’s or Nunamaker’s practice, as she didn’t know the specifics of each.

    But in general, she fears that doctors who switch to a cash-only model will drive away the patients who can’t afford a monthly membership fee or thousands of dollars for an operation.

    “They cherry-pick among their patient population to serve only the wealthier ones,” Stoll said. “It certainly creates a barrier to care.”

    While the article itself is already very interesting, read the (American) comments by the healthcare users/consumers themselves. Very illuminating…

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