Public Private Partnership in Healthcare

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Transforming Singapore Health Care—MK Lim 461 Commentary Transforming Singapore Health Care: Public-Private Partnership† MK Lim,1FAMS, FRCP (Edin), MPH (Harvard) Abstract Prudent health care policies that encourage public-private participation in health care financing and provisioning have conferred on Singapore the advantage of flexible response as it faces the potentially conflicting challenges of becoming a regional medical hub attracting foreign patients and ensuring domestic access to affordable health care. Both the external and internal health care markets are two sides of the same coin, the competition to be decided on price and quality. For effective regulation, a tripartite model, involving not just the government and providers but empowered consumers, is needed. Government should distance itself from the provider role while providers should compete – and cooperate – to create higher-value health care systems than what others can offer. Health care policies should be better informed by health policy research. Ann Acad Med Singapore 2005;34:461-7 Key words: Health care costs, Health care regulation, Health economics, Health reform Introduction Should health care services be publicly or privately funded? And should these services be publicly or privately provided? The answers to these questions largely depend on whether one considers health care a public or a private good. Most people would consider the provision of street lighting and national security to be a public sector responsibility, and luxury items like cars and annual holidays abroad to be private consumption goods best left to the individual to purchase and the private sector to provide. When it comes to health care, however, the issues become highly contentious and the answers are not as clear-cut. While consulting a doctor is a very personal matter, the thought of denying a fellow human being access to the same level of health care because of his or her inability to pay, stirs deep emotions. Historically, the pendulum in the health care debate has swung back and forth between the state and the private sector. Definitions In this paper, the term “public sector” refers to that part f the economy concerned with providing basic government services while the “private sector” is that part of the economy not controlled by the government. The latter could be “for-profit”, or “not-for-profit” in nature. The term “public-private partnership” in health care finance refers to the situation where the government mobilises private sector sources of funds to finance health care services. Correspondingly, public-private partnership in health services provision entails government encouragement of private sector participation in the delivery of public services. The possible combinations of publicprivate mix in the health sector are shown in Figure 1. International Experience The key questions surrounding health care systems around the world are: (a) how to raise revenues to pay for health care; (b) how to pool risks and resources; and (c) how to organise and deliver health care in the most efficient and cost-effective manner. Whether the strategies adopted rely on public sources like taxes and social insurance, or private sources like private insurance and out-of-pocket payment, Department of Community, Occupational and Family Medicine National University of Singapore,

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