Long-term care delivery and financing in Singapore
Michael K. Gusmano
Between 2016 and 2030, Singapore’s population aged 65 years and over is expected to increase from about 12% to about 20% by 2030. Population ageing is driven by a combination of increase in life expectancy and a rapid decline in the fertility rate. According to data from the Department of Statistics, the total fertility rate of the resident population in 2016 was 1.2, below the replacement rate of 2.1. In 2015, life expectancy at birth was 80.4 among men and 84.9 among women, and life expectancy at age 65 was 18.9 among men and 22.1 among women (Department of Statistics Singapore website). Along with Singapore’s demographic shift there has been a growth of chronic disease, including cardiovascular diseases, cancer, Alzheimer’s disease and other forms of dementia. The percentage of older people living with an activity of daily living (ADL) limitation is projected to nearly triple by 2030. These changes will increase the demand for health and long-term care services at a time when family sizes are shrinking and many report that it is more difficult for them to provide care to older relatives (Thomson et al., 2014).
This essay provides a brief overview of the Singapore long-term care system. It begins with an overview of long-term care infrastructure and delivery. Next, it explains how long-term care is financed in Singapore. Even with these various subsidies and insurance schemes, there are substantial out-of-pocket payments designed to encourage responsibility and discourage over-consumption.
The statistics presented in this background essay are current, as of 2016, but it is important to consult the Ministry of Health (MOH), Ministry of Social and Family Development (MSF), and the Agency for Integrated Care (AIC) websites for the most recent statistics, policy, and programme information. The purpose of this essay is to provide an overview of the Singapore long-term care delivery and financing system. It is not designed to provide information that can be used to determine the eligibility of a particular client for public financing in Singapore.
Long-term care delivery system
In Singapore, like all countries around the world, the majority of long-term care is provided by family, friends, and neighbours. A 2012 survey of caregiving in Singapore found that the majority (60%) of caregivers are women and most are between 45 and 59 years of age. Unpaid caregivers report spending approximately 38 hours per week on caregiving, but this is substantially higher for spouses (52 hours) than children (36) or “other” (33) caregivers. As in other wealthy countries in Asia, families in Singapore frequently hire foreign domestic workers (FDWs) to assist with caregiving. According to the caregiver survey, nearly half of the families in Singapore (49.1%) hired an FDW to assist with caregiving. The same survey found that 45% of the FDWs hired to provide care had no experience or formal training in caregiving (Chan et al., 2012).
To supplement the care provided by families, friends, neighbors and FDW, Singapore has an array of formal long-term care services and supports that range from home and community-based care to institutional care – but only about half of those referred for long-term care services use them (Wee et al., 2014). There is a division of responsibility for publicly supported intermediate and long-term care services and supports (ILTC) between the MOH and MFS. AIC, incorporated in 2009, is responsible for coordinating all of these efforts and referring patients and families to appropriate services. AIC processes applications for most ILTC with the exception of MSF’s Senior Activity Centres, which provide social and recreational services to older residents of rental and senior public housing. AIC is also responsible for managing complex cases and improving the quality of ILTC in Singapore. Voluntary welfare organisations (VWOs) deliver the majority of formal ILTC in Singapore (Li and Haseltine, 2014).
MSF programmes: In addition to its Senior Activity Centres, MSF operates several other services. The MSF befriender services programme coordinates and refers volunteers for home visits to older people in order to offer social support, run errands, organise outings and make appropriate referrals for other needed services. MSF also offers counselling services and refers older people and family members to professional counsellors to address emotional health and other personal challenges (Source: MSF; accessed on 10 August, 2016). Along with these home-based services, MSF operates senior group homes, which are flats located within existing rental blocks that provide social care from VWOs and allow frail older people to ‘age in place’. Finally, MSF operates sheltered homes, which were created by the Destitute Persons Act to provide care and rehabilitation to people who are destitute. As of 2016 MSF was operating 14 senior group homes with 37 residents and 16 sheltered homes with about 650 residents in Singapore (Goy, 2016).
MOH programmes: MOH is also responsible for running a number of home- and community-based long-term care programmes. In addition, it is responsible for several institutional care settings, including hospitals, but this brief will focus only on institutions designed specifically for ILTC. The ministry offers several home care programmes for frail older people. These include home medical care, nursing care, therapy, and palliative care. MOH is also responsible for providing Meals-on-Wheels Transport/escort service. (For detail, please see MOH; accessed on December 8, 2016).
In addition to home-based services, MOH runs centre-based healthcare services for older people who need assistance during the day. These include day care and rehabilitation centres and dementia care centres. As of 2016 there are 16 dementia care centres and 57 day care centres in Singapore. With regard to institutional care, MOH is responsible for 66 nursing home facilities. As of 2016, there are about 12,000 residents living in nursing homes and the government plans to expand the number of nursing home beds to 17,000 by the year 2020 (Yong, 2016).
Sources of healthcare financing
There are no accurate estimates of total spending on ILTC in Singapore because most of this care is provided by families, friends, and neighbours. With regard to formal services, public spending represents only about 0.1% of gross domestic product (singaporebudget.gov.sg), but this represents a fraction of total spending. Studies suggest that the economic value of care provided by family, friends, and neighbours dwarfs public spending on health and social care (Arno et al., 1999). Even formal ILTC require substantial out-of-pocket spending. In addition to direct payments by older people and families, there are direct government subsidies for the services described above, as well as means-tested subsidies for individuals. ElderShield, described below, is a limited long-term care insurance programme that provides direct monthly payments to individuals who qualify and may be used for home care, centre-based care or institutional care (Chang and Haseltine, 2014). The Interim Disability Assistance Scheme for the Elderly (IDAPE) provides assistance to older people who were eligible for ElderShield in 2002 because they were too old or had existing disabilities. IDAPE provides S$150 or S$250 a month for up to 72 months, depending on household income. IDAPE payments are designed to assist with out-of-pocket expenses associated with medical bills, nursing costs or to subsidize the costs of hiring a FDW (https://www.gov.sg/microsites/whatsyourplan/healthcare/interim-disability-assistance-scheme-for-the-elderly; accessed on April 23, 2017).
Financial Support for Families and FDWs: In recognition of the important caregiving role of FDW, the government has developed subsidy and training programmes to help make FDWs affordable to more families and to better prepare these workers for this role. AIC administers the Foreign Domestic Worker Grant which provides S$120 per month to qualified families for hiring an FDW to provide care for older people with at least one disability and who require assistance with at least three ADLs. These grants are only available to families with a monthly household income of S$2600 or less (Chang and Haseltine, 2014).
Financing Residential Care: The unsubsidised cost of a six- to eight-bedded nursing home ward ranges from S$1,200 to S$3,500 per month. Government subsidies range between 10% and 75% depending on citizenship status and income (Table 1), but people receiving subsidies must live in six- to eight-bedded wards (Koh and Yap, 2016). For individuals who can afford it, an unsubsidised private nursing home room costs S$4,000 to S$6,500 per month (Tai, 2016). Subsidies are available for Singaporean citizens and permanent residents only.
Table 1: Subsidies for Residential Services*
|Household Per Capita
|Singapore Citizens||Permanent Residents|
|$0 to $700||75%||50%|
|$701 to $1,100||60%||40%|
|$1,101 to $1,600||50%||30%|
|$1,601 to $1,800||40%||20%|
|$1,801 to $2,600||20%||10%|
|$2,601 and above||0%||0%|
* This applies to Chronic Sick Hospitals, Inpatient Hospices, VWO Nursing Homes, Private Nursing Homes on Portable Subsidy Scheme, Ex Mentally Ill Rehabilitation Homes and Ex Mentally Ill Sheltered Homes.
Source: MOH; accessed on August 14, 2016.
As with acute healthcare, out-of-pocket payments are particularly important because Singapore’s health and long-term care systems place emphasis on ‘shared responsibility’ and the need to minimise the problem of ‘moral hazard’. (For more on the concept of ‘moral hazard’, see the backgrounder on Healthcare Financing in Singapore.)
Eldershield: ElderShield is another supplemental insurance fund created in 2002 to help provide coverage for long-term care services. All citizens and permanent residents between the ages of 40 and 69 are automatically enrolled in Eldershield unless they opt out of the system. This fund provides up to $400 per month for up to 72 months. These payments can be used to cover nursing home and home care expenses. Eldershield premiums may be paid for with money from Medisave.
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