WP’s Full Motion on the Cost of Living Crisis—speech by He Ting Ru

Mr Speaker

Over the last few years, one can barely open the headlines without catching a glimpse about various crises facing our planet: ranging from the cost of living crisis that is the subject of this motion, and also the climate crisis, mental health crisis, and crises relating to war and conflict. But even when we may be faced with ‘crisis fatigue’, what affects us viscerally is the surging prices of things that we need on a daily basis.



The adverse impact of the cost of living crisis is seen on both mental and physical health. And while humans have an immense capacity for resilience to get through difficult times, there are measurable, long-term effects on health and overall well-being that result from long term stress. The imbalance in the body’s physiology due to long-term stress – such as the constant worries associated with increasing costs – can lead to increased rates of chronic illnesses such as cardiovascular disease, lowered immunity leading to greater susceptibility to infectious diseases, and also has an adverse impact on mental health. 

I would therefore like to focus on the health and care related elements of the cost of living crisis facing us. There is attention given to the direct link between worries over costs, and the impact that it is having our ability to stay healthy, and to be able to afford care – be it physical or mental health, long-term intermediate care, or even preventive care.  A report released by Cigna in January 2023 about a global survey of 9,000 respondents, also warned that cost of living pressures could trigger a global health crisis. The survey found that rising costs of living are top of mind for most people around the globe, with nearly half of respondents in Singapore saying that it was their biggest worry. Almost two thirds of the 1,100 respondents in Singapore also agreed that inflation is making it too expensive to stay healthy, whether it is through paying for care, or else taking measures to stay healthy. 

A study at King’s College London’s Centre for Society and Mental Health also found that worries about increasing costs pose a major risk to mental health, and those with pre-existing mental health issues are more at risk. The study also found that those who are using savings to meet everyday costs and borrowing money to cope were correlated to psychological distress. 

In view of this, I believe the cost of health and other forms of care is one of the areas which warrants closer attention as we tackle the broader cost of living crisis. While Singapore as a nation has increased healthcare spending as a proportion of GDP in recent years, our current spending at 4% of GDP is still less than half of the OECD average. The health outcomes we have achieved at this cost are rightly a point of pride for policymakers. However, our country is a densely populated urban city where the cost of healthcare delivery is more easily managed compared with countries with larger and sparser geographies. Singapore’s health system also benefits from a generally lower crime and drug abuse rate and road traffic fatality rate than other countries – achievements not to be diminished, and these should be maintained. 

But I believe that our health outcomes could be improved, with Singaporeans living healthier, longer, and safer lives. As an example, my Workers’ Party colleagues have pointed out that for many years now, even before and without Covid, our approach to hospital bed occupancy rates are a cause for concern, with Ng Teng Fong, Khoo Teck Puat, and Tan Tock Seng Hospitals operating at near 100% occupancy just in the last week of October 2023, even though the Government has acknowledged that 85% is the academic consensus safe operating rate. In terms of waiting times, medical manpower per capita, ICU bed capacity in the public health system, there remains concerns about what the tensions in these areas mean for our health outcomes.

These areas should bear continuous scrutiny to maintain confidence in our public healthcare system. Out of pocket costs and waiting times are the most direct interaction that most of us would have with the healthcare system. Around 70% of Singaporeans and PRs have Integrated Shield Plans that cover private medical care, and two in three have riders to pay at least a proportion of medical bills. This is indicative of residents being extremely cognisant about the potential costs associated with ill health and wanting to take action to guard against these costs. A Straits Times article published in April 2022 titled “Having an Integrated Shield Plan and rider may not always guarantee peace of mind”, warned that even buying ISPs and riders may end up with residents still facing substantial bills should they require expensive or treatment for pre-existing conditions. 

Recent commentary has also focused on private insruance coverage for those with mental health conditions, and there is acknowledgement that current coverage is inadequate. In a reply to a question that I filed in September this year, MOH also stated that insurers cannot indiscriminately reject an application solely on, amongst others, the basis of medical conditions, including mental health conditions. I was also happy to see an article in end October 2023 where private insurers stated that they are looking to include better coverage for those with mental healthcare and treatment needs. 

However, the Government should ensure that this does not cause a surge in private sector insurance bills, and regulators have to be ready to step in should private insurance discriminate on various medical grounds. This is especially as inflation in medical benefits is already expected to far exceed inflation in healthcare post-subsidies. Insurance broker WTW currently projects medical benefits inflation to be 9.8% this year, outpacing the broader inflation after subsidies in healthcare, which has generally risen in line with broader inflation over the last one and a half decades.

Next, healthcare schemes and financing are currently extremely complex and are challenging for the person in the street to negotiate. This complexity imposes a bandwidth tax. For example, an individual in the sandwiched generation will have to understand the differences in schemes for both older and younger dependents. If they buy IP riders, they will also need to understand the interaction between public and private healthcare for each dependent. In such situations, I hope that we can try and avoid situations where one ends up over-insuring their family in order to avoid the stress of being caught out unawares. Apart from continuing to work on ensuring individuals feel secure about their ability to cope with the financial aspects associated with future healthcare costs, existing financial education efforts should target this specific point and address what families can do to avoid over-insuring, including demystifying complex insurance schemes which inevitably change from time to time due to developments in the macro environment. 

I now turn to Medisave. For those with low Medisave balances, the Government should offer more Medisave top-ups to address healthcare inflation while continuing to leverage its design which reduces wastage while cutting out-of-pocket costs for consumers. 

In this vein, we have to ensure that yearly Medisave withdrawal limits are updated yearly to reflect inflation, as medical costs can surge rapidly in a short period of time. The headline limit was increased to $500 from $400 in 2018 and was updated in 2020 to allow patients with specified complex chronic conditions to withdraw up to $700 yearly. At the time of the 2018 update, the $500 limit was enough to cover the average annual bill of a patient with three or more chronic conditions. However, we have to look to increase withdrawal limits to match healthcare inflation rates, and consider allowing greater flexibility to use our Medisave savings. One way to do this would be to repeat the Workers’ Party’s proposal to remove the Medisave withdrawal limit for chronic disease management for those over 60, which is contained in our 2020 manifesto. This was also raised by Aljunied MP Gerald Giam in October last year. 

A third Medisave-related point is that our savings earmarked for healthcare expenditure could be used to better support mental health treatment. Anecdotally, it appears that the wait times for access to counselling, therapy and other mental health care have driven some recipients to private services. Alongside ongoing moves to grow public mental health services, can the Government consider allowing users to tap their own Medisave account for a range of private mental health treatments which would include psychotherapy, counselling and other forms of therapy like speech and occupational therapy? This would mean bringing in practices run by therapists and other professionals to allow their treatment costs to also be covered by Medisave.

Mental health is no less important than physical health, and poor mental health can lead to issues with physical health as well. Since Medisave is already being approved for use for mental health services at places like IMH and polyclinics, I hope that we can consider expanding this to include the use of Medisave to access mental health services in other practice settings aside from purely psychiatric settings. This would be important to assist families from across the board, some of whom need to put in place early intervention strategies for their children’s developmental issues, to support a multi-modal approach beyond psychiatric treatment to address neurodevelopmental, mental health conditions and symptoms.

Moving to intermediate and long-term care costs, while the issue deserves a longer intervention on its own, the move earlier this year to provide subsidies of at least 50% to all Singaporeans for palliative care earlier this year is welcome. Likewise positive are plans to extend drug and vaccine subsidies of at least 50% to all patients of MOH-funded providers of long-term care services. However I note that nursing home care costs remain a significant area of concern, with those with per capita household income of over $2,800 not being able to get subsidies for nursing home care. These families would instead have to turn to private nursing homes, which can cost $5,000 or more a month. 

The Workers’ Party in our 2020 manifesto called for there to be more subsidies for intermediate and long-term care costs to relieve the out-of-pocket financial burden of social care for families who need it. With immediate cost of living pressures upon us, can the Ministry share details about the quantitative and qualitative impact the current cost of living crisis has had on the ability of households to pay for ILTC needs, and what the plans are to ensure they do not fall through the cracks and have to dial down on their ILTC arrangements? 

A next step in this revamp of subsidies would be to look again at related subsidies, for instance, the Home Caregiving Grant which was brought up by the member for Hougang SMC Dennis Tan. While the grant was increased recently to now pay between $250-$400 a month for those who satisfy the means testing criteria, the amount is hardly enough to cover care-related needs. The means-testing criteria is also strict and excludes many middle-income households. Additionally, it does not account for the loss of income or non-financial costs such as the invisible workload associated with providing care at home for a family member. 

Finally, I would like to touch on concerns about the cost of healthy eating in Singapore. After all, what we put in our bodies will form a strong foundation for good physical and mental health. And by eating well, I do not mean swapping our national diet for the most expensive proteins or organic foods. Eating well is eating in a way that at least meets what nutritionists recommend as a bare minimum. This is already contained in the Health Promotion Board’s My Healthy Plate guide: a quarter whole grains, a quarter good sources of proteins, half fruit and vegetables. This, as many of us know, can be challenging to do given our carbohydrate-dominant everyday cuisine. This is made even harder for those who work or live further away from supermarkets or places where there is a range of food options to facilitate a healthy diet, and can be tough on those of us who work shifts. It is also harder to address rising food costs when many do not have access to a microwave or fridge at work, which makes it more difficult to bring healthier meals from home. The HPB has a Healthier Dining Programme encouraging availability and accessibility of healthier food and drink options across the island, but we can go further. For example, we can give more consideration and priority to stalls and restaurants that offer quantitatively healthier food under HDB’s Price-Quality Method Tenders framework. 

Sir, the continued cost of living crisis facing us has had an impact on our mental and physical health in the near-term, and also has long-term impacts on our health and development as we grow and age. We need to take steps now to help hard-working families already struggling to juggle their household balance sheets confidently deal with increases in the cost of care – health, preventative and social care – so that it does not become an insurmountable burden. 

Thank you.