As one of the biggest drug purchasers in the world, MOH Holdings should have been able to obtain bulk discounts from overseas suppliers. When medications are sold at much-lower prices across the causeway, something is clearly not right.
WP recently queried MOH Minister Gan on whether public healthcare institutions have been making a profit on drugs. Minister Gan unabashedly told Parliament: “While the drug prices include a margin, this is to offset overheads and operations costs … They are not profit margins.” link
But why do patients – as taxpayers – need to help MOH offset overheads and operations costs when these have already been allocated in the budget? Did the government misallocate public resources by, say, allocating a higher than necessary budget to defence?
Minister Gan can’t simply make a statement, assume all Singaporeans are daft and expect it to be taken at face value.
Healthcare costs have spiraled out of control, no thanks to PAP’s corporatisation, since 3 decades ago.
How PAP has priced polyclinic consultation fee at more than 100% higher than a private GP, as well as the rate of its increase, strongly suggests there is a profit margin in the sale of drugs.
In 2015, polyclinic consultation fee was ‘$38.97’.
Did inflation increase by 7%? Or wages of ordinary citizens? What has increased by 7% to justify the hike in consultation fees? Were polyclinics’ “overheads and operations costs” much higher than a private clinic?
Pricing consultation fee at $41.68 is a total rip-off unless MOH can justify this with a cost breakdown.
Patients may not have realised they have been ripped off because of the imaginary government ‘grant’. But the difference between the ‘full amount’ and ‘payable amount’ comes from taxpayers, ie patients.
It would be interesting to find out how MOH arrived at a $41.68 consultation fee when private GPs charge only about half the amount.
While the profit margin of consultation fee is clear as daylight – more than 100% – the profit margin of drugs can only be confirmed by MOH Holdings:
– Disclosing the cost price of all drugs, excluding ‘offset costs’.
– Publishing a complete set of accounts.
WP should not be satisfied with Gan’s reply as it would mean patients are forced to accept increasingly higher cost of drugs. If asking a question in Parliament is of no benefit to patients, then WP might as well not ask in the first place.
Since Minister Gan has claimed there is no profit margin in the sale of drugs, did high cost result from high staff cost? Million-dollar salary for top management? Was high land price (rental) included in the costing?
The days of PAP ministers making a statement and expecting Singaporeans to blindly accept as the gospel truth are over.
The ball in in PAP’s court and hopefully with some assistance from the WP, we will know for certain if indeed MOH did not profit from the sale of drugs.
* The author blogs at LikeDatOsoCanMeh.