Pandemic empties the coffers of SG’s hospitals

In Singapore, the coronavirus disease 2019 (COVID-19) pandemic has imposed a heavy financial burden on hospitals, driven mostly by the setting up of facilities and procurement of patient-care supplies, a new study has found.

“We found that the prevention and management of the COVID-19 pandemic is associated with high financial expenditure to Singapore hospitals,” the researchers said. “While healthcare services were disrupted during lockdown, these services quickly rallied after the lockdown was lifted.

“Given that we are still in the midst of the COVID-19 pandemic, it is uncertain how subsequent waves of infection or changes in vaccination rates may impact hospital responses and costs,” they added. “Understanding the key costs in the response to the COVID-19 pandemic can enable us to make better informed decisions as we prepare to respond to future epidemics.”

A retrospective cost analysis from January to December 2020 in the Singapore General Hospital, the largest public hospital in the country, revealed that a total of USD 45.39 million had been spent for pandemic response. Most (92.4 percent; USD 41.96 million) were allocated to hospital-based services, while a small portion (7.6 percent; USD 3.43 million) were directed to community support. [J Hosp Infect 2021;doi:10.1016/j.jhin.2021.12.007]

A breakdown of expenditures revealed that over half (51.6 percent; USD 21.67 million) of the financial burden was due to the setting up of facilities and the purchase of capital assets for pandemic-specific care.

The procurement of patient-care related supplies accounted for the second-largest proportion of expenditure, at USD 14.72 million (35.1 percent). Notably, medical supplies represented the largest single-item expense, costing a total of USD 14.08 million and accounting for 33.5 percent of all in-hospital spending.

Labour also emerged as a principal financial sink. Such costs driven mainly by overtime pay and wages of new staff hired specifically for pandemic response, which comprised 62.2 percent of all labour-related expenditures.

Aside from its financial burden, the COVID-19 pandemic has also caused disruptions in hospital services. Whenever the government would raise the Disease Outbreak Response System Condition (DORSCON) alert to orange level, indicative of severe and highly transmissible disease, and implement a circuit-breaker, the uptake of other hospital-based services drops.

For instance, non-emergency surgeries dropped by 45 percent (p<0.001) during the circuit breaker as compared to pre-COVID-19 rates of use, representing the greatest lost opportunity associated with the pandemic. In comparison, outpatient visits dropped by 36 percent, emergency department visits by 16 percent, and inpatient bed days by 11 percent (p<0.001 for all).

“Cost studies in healthcare are useful to inform decisions for efficient allocation of healthcare resources. In this study, we reported the cash expenditures, bed-days used for COVID-19 patients and changes in healthcare services due to the COVID-19 pandemic in a tertiary hospital in Singapore,” the researchers said.

“While we did not tabulate the actual costs associated with lost opportunities due to missed revenue, we observed significant reduction in volumes in all hospital services during the circuit breaker period compared to the pre-COVID-19 period,” they added.