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2019 Singapore Healthcare Outlook
June 2019
© Reciprocus International. All rights reserved.
2019 Singapore Healthcare Outlook
Overview
The healthcare sector across the world is changing. The Inevitable Aging Population
Stakeholders – governments, healthcare providers, Page 3
pharmaceutical and life sciences companies, MedTech
companies, insurers and patients are at a juncture where
they have to manage clinical, operational and financial
challenges internally while burdened by the external forces The Prevalence of Chronic Diseases
Last update: 1/7/2019 4:59 PM Singapore Standard Time
of digital advancement, aging populations, increasing Page 4
chronic diseases and growing demand for improvement in
access and quality of care.
This outlook reviews the current state of Singapore’s
healthcare sector, explores some of the most immediate The Expectations of a Patient turned Consumer
and most talked-about trends, issues affecting the Page 5
stakeholders and offers some considerations as to how the
stakeholders can overcome these challenges.
Case Studies
Pages 6 to 8
Closing Thoughts and Contacts
Pages 9 to 10
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2019 Singapore Healthcare Outlook
Increasing demand of elderly-care and scrutiny of the existing care delivery model
poses a challenge in providing long-term care for our seniors.
Supply and Demand of Nursing Home Facilities
In thousands of elderly population and beds
By 2030, almost one-quarter of Singapore’s population would be at the age
Supply Demand
of 65 and above, equating to about 900,000 people, a 63% increase from its
550,000 people in 2018. 18.0
17.0
14.4
Last update: 1/7/2019 4:59 PM Singapore Standard Time
With the oncoming silver age being cast upon the nation, Singapore has to 12.0
aggressively ramp up its number elderly care facilities to cater to the needs
of the elderly population.
Percentage of Elderly Population of Total Residents 2015 2020
Most nursing homes follow a dormitory-style infrastructure due to
25% Source: Ministry of Health, WHO
real estate constraints and cost efficiencies
However, simply increasing the number of
20% “Those who stay in nursing homes, their medical condition is
nursing home facilities will not suffice. The complex, and they don’t have a constant caregiver. Some
15% current care delivery model does not cater require bed baths… some have multiple conditions… there are
for elderly residents with special needs, also single elderly who don’t have family to support them,”
10% and institutionalized care will be scrutinized
Mdm Low Mui Lang
by the changing expectations of the Executive Director
5%
residents. Salvation Army’s Peacehaven Nursing Home
0%
1990 1995 2000 2005 2010 2015 2020 2025 2030
5-yr CAGR Stakeholder considerations
1.6 2.1 2.4 2.1 5.6 7.6 4.3 2.7
(%) Elderly-care service providers have to start considering services beyond the hospital walls,
Source: Singapore Department of Statistics, Ministry of Health giving the seniors more opportunities to be cared for at home, especially for post-discharge
follow-up treatments and monitoring of those with special needs.
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Chronic diseases continue to be prevalent in Singapore; cardiovascular diseases, in
particular, has been the leading cause of death despite its preventability.
Singapore’s population is not only aging but
2017 Leading causes of DALYs in Singapore Cardiovascular diseases (CVDs), among all NCDs that plague
also spending 1.5 more years in ill health. In % of total DALYs the population has been the most worrying. It is the most
Chronic illnesses plague the population, and Cardiovascular diseases
common disease and to a large extent, due to age (which adds
seniors are suffering from multiple chronic Cancers
to the problem of the aging population) and lifestyle. Though it
conditions. It is unfortunate, but the increase Musculoskeletal disorders
Last update: 1/7/2019 4:59 PM Singapore Standard Time
Mental disorders is preventable with a combination of diet monitoring,
in years of ill health has outmatched the gain
Neurological disorders stress reduction and increased physical activity, the
in number of years expected to be lived.
Unintentional injuries diseases have continued to persist among Singaporeans as
Other NCDs the leading cause of death.
Average Life Expectancy at Birth Diabetes and kidney diseases
In years Respiratory infections and tuberculosis Number of deaths caused by CVDs
Sense organe diseases
90 Period 2013 2014 2015 2016 2017
HALE LE-HALE Skin and subcutaneous diseases
Chronic respiratory diseases Total Deaths 18,938 19,393 19,862 20,017 20,905
Maternal and neonatal disorders
Deaths from CVDs 5,587 5,799 5,879 5,905 6,292
80 11 Self-harm and interpersonal violence
Digestive diseases
Transport injuries On average, 16 people die from CVDs (heart
30%
70
9 Substance use disorders diseases and stroke) in Singapore per day.
Nutritional deficiencies This rate accounts for one-third of all deaths in
Other infectious diseases Singapore.
74 HIV/AIDS and other STDs
60
67 Enteric infections
Neglected tropical diseases and malaria NCD Others Stakeholder considerations
50 0% 4% 8% 12% 16% Treatment providers should consider integrating some form of
*DALYs: Disability-Adjusted Life Years which measures years of healthy life lost to premature chronic disease management (CDM) tools that can be
1990 2017
death and disability.
LE: Life Expectancy incorporated into the daily lives of the patient to facilitate follow-
Diseases that WHO have prioritized as the main chronic diseases worldwide
HALE: Healthy Life Expectancy ups and monitoring as a preventive care solution.
LE – HALE: Expected Life Years in Sickness Source: The Burden of Diseases in Singapore 1990 – 2017, MOH
Source: Ministry of Health
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Pain points exist for both patients and doctors, and addressing these issues mean
more than providing excellent healthcare and services.
As patients become more knowledgeable and gain Key pain points in a healthcare journey
more influence over their healthcare decisions, they
become more demanding of greater service,
convenience and value.
Scheduling Diagnosis & Treatment Discharge & Report Recovery & Monitoring
Last update: 1/7/2019 4:59 PM Singapore Standard Time
Stakeholders have to start viewing patients as Patient ▪ Long waiting times for ▪ Overcrowding resulting in ▪ Lack of clarity in the ▪ Lack of technical expertise to
customers “shopping” for healthcare, and as with all appointments, whether for long queues and waiting expense structure resulting monitor their health and recovery
other industries, review how they make their products consultation or just times regardless of in frustration when bills thus resulting in a struggle to follow
collecting prescription severity of condition sum up higher than the prescribed medication and
and services more accessible to these savvy expected treatment plan
consumers. Patient satisfaction has to be one of the ▪ Having to reiterate medical ▪ Lack of payment choices
top priorities, considering that they always have other history from memory
options available.
Doctor ▪ Lack of flexibility in the ▪ Lack of access to complete ▪ Burden of documentation ▪ Patient fails to comply with treatment
scheduling system to health profile of the patient mandate resulting in relapse of
accommodate personal resulting in fear of disease symptoms
preferences potentially prescribing ▪ Uncertain of patient’s current
unnecessary tests or condition to prescribe medication
treatments without physical review
Patient’s pain point of waiting times
At most hospitals (for subsidized outpatients): Average daily wait times: Stakeholder considerations
▪ Routine MRI scan: 2 to 3.5 weeks ▪ Polyclinics: 0.7 to 1.2 hours Integrating healthcare apps and platforms is one way to stay engaged with
▪ Routine CT scan: 1 to 3 weeks ▪ Public Hospitals: 1.4 to 3.3 hours
the patients throughout the healthcare journey. In the context of scheduling
New appointments at specialist outpatient clinics: Average waiting time for urgent appointments, a platform that connects patient and doctor directly can
▪ Subsidized patients: 29 days conditions (e.g. suspected cancers): alleviate the pain points of both parties.
▪ Private patients: 8 days ▪ Polyclinics: Around 1 week
Source: MOH
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Emerging business opportunities for healthcare stakeholders to improve the
sustainability of their organization in the long-term.
Sustainability is not new to healthcare, but it has been gaining attention
given the changing landscape and challenges posed. 1 Provide a generalist care
delivery service that caters to
2 Focus on providing treatment
for diseases that have
It is increasingly essential for healthcare organizations to not just question the three immediate exhibited trends of increasing
Last update: 1/7/2019 4:59 PM Singapore Standard Time
the viability of the existing business model, but to craft strategies that healthcare issues number of cases
ensure their organization has the necessary resources over the long-term.
Long-term vision and sound investment strategies are key components of a As we have reviewed, the aging Given the landscape of increasing
sustainable business plan. population, increasing chronic chronic care needs, stakeholders could
conditions, and growing consumerism consider to specialize in the treatment
Understanding that every organization’s journey will be unique in the are the three most immediate issues in of specific diseases. This can be to
challenges they face and the solutions they implement, here are two Singapore, and these issues have a increase in the capacity or quality of
possible approaches to these challenges and case studies for the compounding effect on each other. The treatment.
consideration of the stakeholders. resulting landscape is one where there
is increasing demand for convenient Since there is already considerable
healthcare options from seniors with demand for chronic care needs, an
chronic diseases. acquisitive approach will jump start
market access or accelerate market-
Stakeholders could consider taking a share growth
generalist approach to cater to this
demographic.
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1 Homage specialises in catering to the on-demand healthcare needs of the seniors.
Similar opportunities for such a business model are plausible within other age groups.
Supporting research for business model:
2017 Acute Hospital Admission Rates by Age 2017 Distribution of Population by Age
In rate per 1,000 resident population
516,692
400
Senior Opportunity for the population of
13%
Last update: 1/7/2019 4:59 PM Singapore Standard Time
300 342 residents ages 15 to 64 years old
200
Considering that this age group
100 makes up more than half of the
0
population, there is significant
0 to 14 15 to 64 65 & Above potential for an on-demand service
Source: Ministry of Health catering to this population segment.
Homage is a Singapore-based startup that matches caregivers Since this age group mostly
and organizations with the elder patients and their families, Percentage of Seniors that suffer from… comprises of working adults, the
Equivalent to an average
providing on-demand care professionals depending on the type and severity of chronic
admission rate of 3 or more chronic conditions 37%
senior’s illness or other specific needs. conditions and the preferred
484 seniors per day in 2017
High blood pressure 72% delivery model is different.
Main Services Specialized Services
Cataract 31%
▪ Daily Living Care ▪ Dementia Care Stakeholders considering this form
(e.g. showering, meal preparation, ▪ Stroke Care Musculskeletal disorders 29% of expansion should review what
medication escort and reminder) ▪ Parkinson’s Care
▪ Nursing Care ▪ Cancer Care
ailments are most common within
Diabetes 25%
(e.g. stoma and wound care) this age group, and the most
▪ Home Therapy Loneliness 34% effective delivery channel.
(e.g. physiotherapy, speech therapy)
Source: Duke-NUS Medical Schools Centre for Ageing
Research and Education
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2 Luye focus on speciality areas, providing treatment to specific diseases. Potential
routes of expansion lie in preventive and post-treatment care.
Supporting research for acquisition rationale:
In addition to the research on Slide 4,
Last update: 1/7/2019 4:59 PM Singapore Standard Time
Acute Myocardial Infraction (AMI) / Heart Attack incidents
In number of reported cases Opportunity to target lifestyle of
working-class population
10,728 (2016)
8% resulted in death
As with most chronic conditions, CVDs
6,795 (2009)
and AMIs are typically resultant of poor
16% resulted in death
Singapore-based Luye Medical Group (Luye) acquires a lifestyle habits. Further research into
majority stake in Novena Heart Centre (NHC). Luye’s 2007 2010 2013 2016
the demographics of the target group
acquisitive strategy to improve the organization’s financial Source: Health Promotion Board should reveal pain points that
sustainability is based on the rationale that the trend of eventually lead to such illnesses or
increasing incidences of cardio vascular diseases will continue Distribution of AMI incidents by age at onset cause relapses.
to rise. Consequently, the demand for cardiovascular treatment In number of reported cases
Age Group % Increase
will increase. Stakeholders that specialize in specific
Luye Medical Group Business Segments (SG) diseases can explore long-term
70 & Over 59% It is not only an issue of
▪ Novena Heart Centre preventive or post-treatment
Specialist cardiology services an aging population, but
monitoring services/devices that cater
▪ Oncocare Cancer Centre that the population is not
Specialist oncology services to the patients.
50 to 69 71% aging healthily as well.
▪ AsiaMedic Limited
Medical imaging services 30 to 49 7%
2007 2016
8 Reciprocus International2019 Singapore Healthcare Outlook
Collaborations and partnerships are essential in building an integrated and patient-
centric healthcare system that delivers life-long care to the people.
The industry will continue to transform as healthcare focus shifts Investors
to enabling patients with accessible and personalized care and not
just treatment when they are ill, but also preventive and life-long
well-being. Governments
Last update: 1/7/2019 4:59 PM Singapore Standard Time
and Health IT and
Stakeholders, regardless of government or private, will have to Authorities System
Healthcare
refresh their business model to enable a more patient-centric and Providers
Providers
consumer-style care delivery model. And though each
organization is unique in its own right, and there is no one-size-
fits-all strategy, it is necessary to consider strategic partnerships Pharma
within the ecosystem. It is only through a collaborative effort that Universities
stakeholders can realize the opportunities. and
Laboratories
Life
Science
Companies Patients and Citizens
Distributors
Medical
Charities
Product
and
Companies
Associations
Insurance
Providers
9 Reciprocus International2019 Singapore Healthcare Outlook
Expansion efforts can be eased with the use of government grants and incentives.
Here are some for your consideration.
This outlook has highlighted only a few of the more Incentive What they offer Approving authority
pressing challenges of the healthcare sector and
Market Readiness Up to 70% of eligible costs for pre-determined activities such as Enterprise
provided a slight glimpse of the possible solutions.
Assistance (MRA) Business Matching, capped at SGD 20,000 per company per Singapore
Last update: 1/7/2019 4:59 PM Singapore Standard Time
fiscal year.
In reality, the opportunities are plenty, promising and
accompanied by other barriers (e.g. the potential Enterprise Development Up to 70% of research/advisory fees of qualifying projects such Enterprise
complications of personal data in the context of Grant (EDG)1 as market research and feasibility study, development of M&A Singapore
strategies and due diligence work.
electronic health records as technology-enabled care
becomes more prevalent in the industry). It is necessary Double Tax Deduction for Up to 200% tax deduction on eligible expenses for international Enterprise
for stakeholders to properly understand its addressable Internationalization (DTDi) market expansion and investment development activities, which Singapore
market opportunities and the challenges that lie ahead, includes investment feasibility/due diligence studies and master
licensing and franchising
specific to its position and objectives.
Mergers & Acquisitions Allowance of 25% of the cash consideration paid (capped at SGD Inland Revenue
Cost implications are naturally an additional layer of (M&A) Scheme2 10 million), stamp duty relief on the transfer of ordinary shares Authority of
complexity in decision-making for the stakeholders. For (capped at SGD 80,000), and double tax deduction on transaction Singapore (IRAS)
costs incurred (capped at SGD 100,000) for a qualifying
the purpose of aiding the expansion journey, here is a list
acquisition.
of some of the government grants and incentives that
could be of use to you. Development and Corporate tax exemption of 5% or concessionary tax rate of 10% Economic
Expansion Incentive (DEI) on income derived from qualifying activities such as service fees, Development Board
franchise fees and management fees. of Singapore (EDB)
1 Incentive expires 31 March 2023
2 Qualifying period ends 31 March 2020
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Your Reciprocus contacts
If you would like to have a one-on-one discussion on how this subject may Singapore Team Office Locations
affect your business or have enquiries on the applicable government grants and
incentives in Singapore you could tap on for our advisory practice, please David Emery Reciprocus International
contact one of the Reciprocus professionals listed. Chairman and Founder International Plaza
Last update: 1/7/2019 4:59 PM Singapore Standard Time
(65) 6225 9986 10 Anson Road #10-22
For more information on our advisory practice, please visit www.reciprocus.com Singapore 079903
david@reciprocus.com
Tel: +65-6225-9986
Fax: +65-6225-8223
Jason Goh Reciprocus Americas
Vice President, M&A GlenPointe Centre East
(65) 6225 9986 ext 113 300 Frank W. Burr Boulevard, Teaneck
Suite # 720 New Jersey 07666
jason@reciprocus.com
Tel: +1-212-465-9555
Fax: +1-646-349-3532
Loh Yun Xuan Reciprocus Europe
Associate Täfernstrasse 22a
(65) 6225 9986 ext 110 5405 Baden-Dättwill
Switzerland
yun@reciprocus.com
Tel: +41 56 470 42 70
Fax: +41 56 470 42 72
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