HEALTH services in Singapore will get an injection of over $2 billion from the government to build more hospitals, polyclinics and other medical facilities over the next eight years.

They will be needed to meet a population that is growing at a 'shocking' rate from an influx of immigrants, and also for the higher and different demands of a greying society, said Health Minister Khaw Boon Wan at the ground-breaking ceremony of Singapore General Hospital's new pathology laboratory.

Increasing infrastructure is easy, but the minister cautioned that the bigger problem is keeping a lid on costs so medical care remains affordable for all.

'All over the world, medical inflation exceeds general inflation,' he said, warning that operating budget will go up.

This will have to be shared by all stake-holders - the government, employers and patients. As the total cost goes up, the patient's share will 'invariably' go up too.

He served early notice that means testing will be needed to ensure that the poor get the bulk of government help.

This sensitive subject has come up time and again in the past, but has not been adopted at public hospitals, due to vociferous protests from the public.

So far, means testing applies to step-down facilities such as nursing homes and hospices. This has resulted in skewed demand as it has become cheaper for a subsidised patient to remain in a public hospital.

Mr Khaw said it would be 'dishonest' to say means testing is not necessary. The concept is simple, he explained. 'Patients who are better off can and should shoulder a higher burden. If they choose subsidised services, they should get lower subsidy than those who are less well-off. That is why we need means-testing.'

He had previously promised to raise the issue of means testing until he has revamped Medisave and MediShield to help people meet their medical costs.

Since July, more CPF money has been channelled into Medisave, the part that can be used to pay for medical costs.

MediShield, the national health insurance, has also been tweaked to pay a larger portion of big hospital bills.

To cope with rising demand, Mr Khaw promised that the government will continue to pay the biggest share of subsidised care.

Looking at the worldwide trend of spiralling healthcare costs, he said Singapore's spending, at 4 per cent, is 'the best among developed countries'.

But he worries about how high it might grow, maybe 5 to 7 per cent, or higher.

Healthcare costs in the United States, whch stands at 16 per cent of its gross domestic product today, 'is still accelerating'and is projected to top 20 per cent.

Japan, which spends 8 per cent on healthcare, is under pressure to raise it.

The key lies in 'more creative ways to maximise the use of expensive resources', said Mr Khaw, who spelt out plans to keep a tight rein on rising costs.