Public hospitals are nonprofits but make $25m per year?

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By: Leong Sze Hian

I refer to the Ministry of Health’s reply “Public healthcare institutions operate on non-profit basis” and Singapore General Hospital’s reply Our charges are comparable to most hospitals” (Straits Times Forum, Mar 24) to the two letters by Mr David Soh Poh Huat (Do public hospitals profit from medical procedures done?; March 11, and Health Ministry should step in to regulate costs; Forum Online, March 17).

PHIs operate on a non-profit basis, but cover operations/overheads costs?

The former states that “Our public healthcare institutions (PHIs) operate on a non-profit basis. Where margins are applied, these are used to cover manpower, operations and maintenance, and overhead costs associated with the provision of specific services, drugs and investigations.”

What % to operations/overheads costs?

So, what is the percentage of the prices for drugs that is the margin applied “to cover manpower, operations and maintenance, and overhead costs”?

“Non-profit” means not spending any money?

Does “non-profit” mean not spending any money if all costs, including operations and overheads are covered?

$25m profits?

According to the latest annual reports of the National Health and SingHealth Groups on their web sites – their combined profits (revenue – expenditure) for their last financial year was $25 million.

Any countries’ public hospitals make money?

Are there any countries in the world whose public hospitals make money every year?

Explanation as to why public hospitals may cost more than private hospital?

The latter states that “Whole-body scans account for more than 90 per cent of positron emission tomography (PET)-CT scans done at Singapore General Hospital. The charges for this service, with and without intravenous contrast, are $2,400 and $2,300 before GST respectively.

Our charges reflect the underlying costs of providing the service. This includes manpower, supplies and consumables, maintenance and depreciation, and other non-direct costs such as having an integrated clinical IT platform where images are digitally archived and patients’ medical records stored and made easily accessible for doctors’ consultations across all public healthcare institutions.

This ensures timely diagnosis and access to care.

Our charges are comparable to those of most other hospitals in the public and private sectors, although we note that one private PET centre charges $1,600 for some groups of patients, as stated in Mr Soh’s letter.

Public hospital procedure cost 50% more than private hospital?

Apart from differences in the specific types of machines and sensitivity of scans, there may be differences in clinical protocols and software used, which could have an impact on longer-term management of patients with complex and multiple conditions” – this “quite long” reply seems to only reconfirm the issue raised in the forum letters as to how can the same procedure cost 50 per cent more ($2,400 divided by $1,600) in a public hospital compared to a private hospital?

As to “Various providers may also have different pricing strategies.

Patients can discuss & choose where they prefer to scan?

Patients can discuss with their doctors the appropriateness of any scan and decide where they prefer to get the scan done” – do you mean that the doctors at the public hospitals have ever told patients routinely as to the “different pricing” by “various providers” and ask them to “decide where they prefer to get the scan done”?