2016: A YEAR OF DISRUPTION

MediShield Life casts a big safety net

The full impact of MediShield Life was felt only this year, as more people it covered needed hospital care or major outpatient treatment, such as chemotherapy to combat cancer.
The full impact of MediShield Life was felt only this year, as more people it covered needed hospital care or major outpatient treatment, such as chemotherapy to combat cancer.ST PHOTO: ALPHONSUS CHERN

MediShield Life - a national scheme which ensures that everyone has insurance to pay big, subsidised hospital bills, no matter their age or health condition - had one of the biggest impact on healthcare here this year.

Although the scheme officially started in November last year, the full impact was felt only this year, as more people it covered needed hospital care or major outpatient treatment, such as chemotherapy to combat cancer.

For the first time, people who were too old to be insured, or had serious illnesses that resulted in insurers excluding coverage for those problems, found themselves with a financial safety net when they incurred big hospital bills.

In the first 10 months, MediShield Life paid out $102.5 million in 65,000 claims to people who previously had not been insured. This worked out to about $1,577 per claim, with some people making more than one claim in that period.

The coverage is pegged at subsidised rates, for either B2- or C-class treatment. Any Singaporean is eligible to choose a subsidised class which receives a 50 per cent to 80 per cent government subvention.

This has proven to be a particular boon to people in the pioneer generation - the 450,000 Singaporeans aged 65 or older in 2014 who were citizens on Dec 31, 1986 - with the Government paying all or most of their annual premiums through subsidies and Medisave top-ups.

This enabled them to pay very little or nothing, if they were 80 or older in 2014, to enjoy insurance coverage of up to $100,000 a year.

People who were already insured before the launch of MediShield Life also benefited from the change, especially those aged 65 and older.

For them, the average payout of $1,639 was 15 per cent higher than before, as enhancements to the scheme resulted in it covering a larger portion of bills, as well as having higher annual caps.

The total paid out to people aged 65 and older in the first 10 months was $282 million, an increase of 86 per cent over the $151 million paid out in the same period in the previous year.

Another indication of the help it has provided was that Medifund aid, the safety net for the poor, fell by $4 million last year, even though it approved more applications for help. Since a greater portion of medical bills was paid for by MediShield Life, there was less need to draw the remainder from the safety net.

While the Government has promised to keep MediShield Life premiums unchanged for five years, insurers offering integrated plans, which sit atop MediShield Life to provide coverage for private medical care, agreed not to raise premiums for only a year.

With that year up, three of the six insurers which offer integrated plans have raised premiums, with increases as much as more than 36 per cent.

The other three are also expected to raise their premiums because payouts for private-level care have also risen significantly. Given the increases in the past, the two in three people here who have higher-level Shield plans can expect to see regular premium hikes in the future.

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A version of this article appeared in the print edition of The Straits Times on December 29, 2016, with the headline 'MediShield Life casts a big safety net'. Print Edition | Subscribe