Bryan Caplan  

Quality Health Care for Peanuts: How Singapore Does It

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If Michael Moore really wanted to challenge our preconceptions about health care, Sicko would have been a documentary about health care in Singapore. Nick Schulz just pointed me to a very good summary of how the system works. It's not laissez-faire, but it is state intervention with the hands of a surgeon:

What’s the reason for Singapore’s success? It’s not government spending. The state, using taxes, funds only about one-fourth of Singapore’s total health costs. Individuals and their employers pay for the rest. In fact, the latest figures show that Singapore’s government spends only $381 (all dollars in this article are U.S.) per capita on health—or one-seventh what the U.S. government spends.

Singapore’s system requires individuals to take responsibility for their own health, and for much of their own spending on medical care. As the Health Ministry puts it, “Patients are expected to co-pay part of their medical expenses and to pay more when they demand a higher level of service. At the same time, government subsidies help to keep basic healthcare affordable.”

The reason the system works so well is that it puts decisions in the hands of patients and doctors rather than of government bureaucrats and insurers. The state’s role is to provide a safety net for the few people unable to save enough to pay their way, to subsidize public hospitals, and to fund preventative health campaigns.

Of course, if third parties pick up the tab, the decisions of "patients and doctors" might be far less efficient than the decisions of "bureaucrats and insurers." So Singapore strives to couple choice with financial responsibility:
In Singapore’s system, the primary role of government is to require people to save in order to meet medical expenses they don’t expect. While the Singaporean government does regulate prices and services, its hand is nowhere near as heavy as that of governments with extensive nationalized healthcare, such as the United Kingdom or Germany.
I prefer medical laissez-faire to the status quo of Singapore. Still, it's worth calling attention to its success. Singapore shows that we can meet populist demands to "take care of everyone" for a fraction of the cost that both Europeans and Americans take for granted.


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The author at amcgltd in a related article titled Health Care, for the Rest of Us? writes:
    I've railed against the various Democrat-sponsored (or left-wing endorsed) health care ideas many times on this site. It would appear that, finally, people have found a state-run alternative that works: Americans have grown used to buying every kind o... [Tracked on May 27, 2008 1:02 PM]
The author at Jim's Blog in a related article titled How to do health care right: writes:
    The American health care system is socialism without a central plan, and capitalism without markets or prices. Singapore has a better compromise. ... [Tracked on May 27, 2008 6:37 PM]
COMMENTS (2 to date)
Eli writes:

I think a Pigovian tax on low-deductible health insurance would go a long way, while remaining less paternalistic than the Singaporean system.

Chuck writes:
Singapore shows that we can meet populist demands to "take care of everyone" for a fraction of the cost that both Europeans and Americans take for granted.

This is poppycock. We pay roughly twice our GDP compared to all others, including Europeans, for healthcare.

What you probably meant to say was, "we can take care of everyone with a fraction of the government intervention that both Europeans and Americans take for granted."

But I think this is missing the big point. The big point is that our system, as it is, is twice as expensive as all others.

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