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3 Potential Obamacare Changes Courtesy of Singapore

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Love it or hate it, Obamacare is now the American health care system. But even ardent supporters acknowledge that it's not perfect. Some would prefer a universal health care system similar to several European countries. 

There is another path to potentially addressing shortcomings in the Patient Protection and Affordable Care Act, though. Singapore boasts one of the world's most effective and low-cost health systems. And it's quite different from what you'll find in much of Europe. Here are three intriguing ways that Obamacare could change to replicate some of Singapore's success.

1. Implement a new individual mandate
Singapore's health care system incorporates an individual mandate, but it's not what you might think. Instead of merely requiring citizens to purchase insurance, the country mandates that individuals save money for their health care needs. We're not talking piggy bank money, though. Singapore residents below the age of 50 pay 20% of their salaries, with another 16% kicked in by their employers. Those percentages decrease for older citizens.

Since both Democrats and Republicans shy away from increasing taxes on the middle class and lower-income Americans, requiring people to pay one-fifth of their incomes for health care would probably float like a lead balloon. If the government makes you do it, it sounds like a tax. However, consider this: Singaporeans are healthier than Americans, but we actually pay almost five times per person overall that what they pay for health care. 

2. Decrease the overall role of government
Obamacare increased the role of government in health care. Singapore's government, on the other hand, takes a much less prominent role. The result is that total government spending on health care in the country is only around one-third of federal government spending in the U.S. 

How do they accomplish this? While the government pushes Singaporeans to save for medical care, the people themselves make most of the decisions on how to spend the money. The emphasis is on personal responsibility. A side benefit of this is that it promotes competition and innovation among the nation's health care providers.

Perhaps the closest parallel to this idea that currently exists in the U.S. is the health savings account, or HSA, offered by several insurers. For example, UnitedHealth's (NYSE: UNH  ) HSA allows members to put money into the account and use the money to pay for medical costs up to their deductible levels. Traditional insurance then kicks in to cover the rest of the cost.

While it's easy to see why liberal politicians perhaps would not like this idea, why might conservatives hate it? Following the Singapore model of lower government involvement requires that expanded individual mandate mentioned above to be in full force. This approach would also be quite disruptive, a reality that could scare off even those predisposed to support the concept.

3. Target specific areas for more government involvement
When the Supreme Court upheld much of Obamacare in 2012, shares in large hospital system operator HCA Holdings (NYSE: HCA  ) soared. The stock is up over 40% since the ruling. The key reason: Hospitals incurred significant losses when they had to absorb costs of providing free medical care to uninsured patients. Their hope with Obamacare was that there would be far fewer uninsured people.

Singapore addresses this issue through more government involvement in targeted ways. Like Obamacare, their system subsidizes low-income earners. The government operates several public hospitals. And it regulates prices and services, although not with an iron fist as seen in socialized systems.

Overall, Singapore has a lower profile in health care than the U.S. government does. That approach probably wouldn't appeal to many Democrats. Republicans typically aren't big fans of government regulations on pricing. Both sides have something to dislike.

Love or hate?
While Obamacare's goals included improving health care and lowering insurance premiums, some people, including Aetna (NYSE: AET  ) CEO Mark Bertolini, think that insurance premiums will actually rise. If Bertolini and others are correct in their predictions, there could be a public groundswell for changes.

Singapore's system, like Obamacare, isn't perfect. However, with overall per-capita costs amounting to only a fraction of those in the U.S., perhaps we should consider borrowing a few ideas. Whether you love Obamacare, hate it, or are somewhere in between, there's one thing that all Americans can agree on: We want to continually improve.

What's your take on Singapore's approach? Could some of their ideas work in the U.S.? Voice your opinion in the comments below.

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Read/Post Comments (16) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 13, 2013, at 2:30 PM, therylmccoy wrote:

    Singapore is brilliant. I could not get insurance because of a knee sprain I had 5 years ago. This sprain healed on its own and the doctor only looked at the xray and advised. Now I have a 'preexisting condition' and am NOT ELIGIBLE for health insurance.

    By the way, many people already pay 20% of their incomes to health insurance premiums, and they STILL have to wait for their deductible to be met and then they still have to pay a percentage after that.


  • Report this Comment On April 13, 2013, at 2:45 PM, wayase wrote:

    The Singapore system is small but has improved tremendously over the last 30 years. Another appropriate model to consider would be Switzerland. Top Notch care.But we should not forget the the size, complexity, and individualality of the US and Americans as well as the size of our uneducated and poorly educated population. These two systems do not have to contend with that.

  • Report this Comment On April 13, 2013, at 2:49 PM, GeorgeC57 wrote:

    Singapore do not have any 50% of its population overweight and the medical profession do not practice defensive medicine. AND minimum drug addicts. Any drug dealer that try to smuggle drug into their country is EXECUTED.

  • Report this Comment On April 13, 2013, at 3:12 PM, Chishiki wrote:

    Point 1 sounds a lot like a health savings account. Also if you consider how much people pay in insurance premiums and out of pocket cost it is not a tax increase at all to require 20% of your income to go into these accounts. If anything, you would pay less total money because you have to considering the savings of no longer paying for the other medical programs we pay for know.

    Swapping everyone over to health savings accounts that you can use for any health expense as you see fit and then requiring a percentage of your income to go into that account sounds like a much better solution

  • Report this Comment On April 13, 2013, at 3:15 PM, TomZofMaine wrote:

    "While the government pushes Singaporeans to save for medical care, the people themselves make most of the decisions on how to spend the money. The emphasis is on personal responsibility. A side benefit of this is that it promotes competition and innovation among the nation's health care providers." That says it all. Get the gov't and employers out of it, and let our free economy do its thing.

  • Report this Comment On April 13, 2013, at 3:16 PM, Chishiki wrote:

    One thing I forgot to mention is there should probably be some sort of maximum cap in which your no longer required to pay 20% of your income into these accounts.

  • Report this Comment On April 13, 2013, at 3:23 PM, Kerschnuffle wrote:

    I think your second and third points state why it would not work here.Personal responsibility and less overall government control would be too much for nearly half of the American population.

  • Report this Comment On April 13, 2013, at 4:29 PM, Freddbe wrote:

    I new everything couldn't be privatize to be affordable or better. Promotes competition is a scam in this country and have become a joke. To many to big to fail companies have took over this country. If another company seem to be competitive it is just a scam usually because they are affiliated to give people that fake imagery. Insurance is so bad it needs to be abolished at ever level. Privatized greedy business have made government control of anything, affordable and better. The biggest mistakes congress ever made was to make it mandatory to have any type of privatize insurance. Big companies have lobbyist that brought out congress at every level. This country needs not only big changes but honest big changes.

  • Report this Comment On April 13, 2013, at 4:46 PM, marxwj wrote:

    I don't see this working for the simple reason that their solution to runaway prices is to have the government operate competing hospitals. The GOP has already said this is a non-starter.

    I would like to know how they pay for the low income people. As it said they get subsidized, which means taxes, same as Obamacare.

    I already have an HCA plan that I like under the current system. I currently pay about 7% of my pay and my employer pays about 14% of my pay for premiums. Going up to 20% for me and 16% for my employer is going to be a hard sell at best.

    Much of what we pay as a nation for healthcare also includes funding free flu shots every year, the CDC, and medical research through NIH. Does Singapore do any of that?

    Obamacare is not a bad idea, but we need to have reasonable discussions about it instead of shouting matches. It needs some tweaks to be sure, but ranting at each other won't get that done.

  • Report this Comment On April 13, 2013, at 5:15 PM, sld0010 wrote:

    I wounder what is NOT COVERED?? I wonder if they let some one come over illegally and DEMAND free health care??

  • Report this Comment On April 13, 2013, at 6:10 PM, fatso501 wrote:

    The problem resides in trust. Our government has stolen billions in S.S. trusts, and put it into other projects, and now the system is broke. So now we give them another large chunk? Don't think so Vern.

    How about if you don't have health insurance or V.A. benefits from being in the service...Then die or be ill. The United States Government job is not to do all things for all people. This is why we are in the mess we are in.

  • Report this Comment On April 13, 2013, at 8:13 PM, doco177 wrote:

    1. Millions are and will lose the insurance Obama promised they could keep. Because ObamaCare forces employers to offer expensive Cadillac plans but also offers the option of paying a fine for not providing health insurance that can be cheaper than providing it, between seven and twenty million Americans are likely to lose their health insurance coverage according to the Congressional Budget Office. The original estimate was closer to four million.

    2. The cost of healthcare premiums is about to further skyrocket. Premium costs have already exploded, but that is a slow-motion explosion. In the near future, we could see costs double or worse. Naturally, these costs will hit an already burdened middle class hardest.

    3. Lost jobs. Lost jobs.

    The Federal Reserve's March beige book on economic activity noted that businesses "cited the unknown effects of the Affordable Care Act as reasons for planned layoffs and reluctance to hire more staff."

    Meanwhile, human resources consulting firm Adecco found that half of the small businesses it surveyed in January either plan to cut their workforce, not hire new workers, or shift to part-time or temporary help because of ObamaCare.

    4. Potential doctor shortages that will mean rationing: The healthcare industry is already a bureaucratic quagmire. ObamaCare is about to add steroids. As the profession becomes tyrannized by government, the talented people currently practicing medicine plan to get out sooner than expected. Who knows how many will choose not to get in.

    Doctor shortages are what lead to the nightmare known as rationed care. Here's an unsettling example already being practiced.

    5. Somewhere around $800 billion in tax increases will hit America's middle class. This added burden will not only further oppress a middle class already reeling from a drop in wages over the last few years, but could damage the overall economy.

    6. Inflation, the cruelest tax on the poor. When businesses get socked with added costs brought about by higher taxes and burdensome government mandates, they pass those cost along to the consumer in the form of higher prices.

    7. Added bureaucracy. Even those Obama lapdogs over at the Washington Post's Wonk Blog are admitting that applying for health care is about to get more burdensome than the byzantine paperwork involved in buying a home.

    8. To cut costs or to avoid having to provide insurance, workers on the economic margins are already losing hours, which means a lower paycheck. There are a million sad stories in ObamaVille; here are just a few of them.

    9. ObamaCare is projected to add $6.2 TRILLION to a deficit the GAO has already declared "unsustainable." That's "trillion" with a "t".

    10. More taxes than currently estimated are likely to hit because of situations like this one.

    Three years ago, Obama, Democrats, and his media lied to us about cutting the cost of health care, being able to keep our insurance, and not taxing the middle class.

    Today, those lies and what ObamaCare is and will do to the working and middle class are the biggest untold story in America.

  • Report this Comment On April 13, 2013, at 8:14 PM, SLP123 wrote:

    I am an American living in Sinagpore and contributing to this health savings account called "CPF." Not only does 20% of my salary + 16 % employee contributions get taken out each month for health care , but that money is also used fo retirement. It is basically a forced savings, or pay yourself first plan and your employer also contributes a government subsidized contribution. Online, I have access to see how much money my my employer and I contributed plus the interest gained. It is my money that I can take out at any time and use for investing, buying a home, kids college, medical and retirement. I know it is a bit conservative, but really it is the same as paying a percentage of your taxes to social security except you can actually see where your money is going, to you.

  • Report this Comment On April 13, 2013, at 9:32 PM, RHO1953 wrote:

    The problem is that there is no free lunch. Very few of us have the ability to put twenty percent aside for health care. We would have to give up eating or driving to work, or all recreation. Democrats simply want a rich guy to pay their bills and you know that isn't going to fly for long. The rich guys will pack their bags for better places and the cost per citizen will be spread among a dwindling number of poorer people. Obamacare actually makes health care MORE expensive and it will bankrupt us totally pretty quick. The mandate will force people to buy health care instead of participate in the economy. There is going to be a monstrous crash in about a year and a half.

  • Report this Comment On April 13, 2013, at 11:21 PM, Starvation wrote:


    O puppet plan not his. His masters have the plan. It is to take down this country to third world status. I could not believe there were not enough right minded people out there to get rid of this clown.

    Spent 21 years living and working outside U.S.

    Took the oath a few times, wanted to come home for a rest and live out my days.

    This place is run by persons that hate the USA.

    Any other thoughts are delusional.

    Follow the money. I believe all of these issues being argued over are only a distraction, a smoke screen for the much larger agenda.

    By the way lawyers in Singapore have very little clout when it comes to suing doctors and zero when it comes to local politicians. God help the person that gets in the cross hairs of the government there, including the inner circle.

    I have tremendous respect for Lee Kuan Yu.

    The man had vision and the respect of 90% of

    the Singapore population.

    Look at what we have..

  • Report this Comment On April 14, 2013, at 1:01 AM, ahmadi72 wrote:

    With Obamacare or without it the health care will not come out of mess as long as there are high paid executives and lobbyist in the health insurance companies.

    In Fremont California there is Alameda alliance for health that provide health care services to Medi-cal patients.

    They are absolutely great as far as satisfying patients health needs. Their behavior has made their system the most effective health insurance known in the area. They do not have high paid CEO with a fair believe to take care of patients rather than making profit. Now in this area the most worse insurances are PPO.

    I think the government is the best to run health care if gives all their contacts to the companies like Alameda Alliance for Health.

    Public option is the sole solution to create competition for expensive insurances to bring down their prices.

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