The recent Opinion piece “How to fix S’pore healthcare insurance and preserve care continuity for patients” (April 25) and the Singapore Medical Association’s reply “Address power imbalance between IP insurers and policyholders” (April 27) have reignited the discussion about the portability of Integrated Shield Plans (IPs).

One key feature in this discussion is the underlying assumption that “policyholders” are a homogeneous group. In reality, policyholders differ greatly in terms of their health status, lifestyle choices, how they prefer to consume healthcare and how they expect that to be financed. 

Different policyholder profiles impose different claim costs on the insurance product, which are then shared by all policyholders who bought the same product. We have heard from those policyholders seeking care that they desire care continuity.

Providing that continuity will likely increase claim costs, leading to higher premiums. Every year, over 80 per cent of IP policyholders do not make a claim. This majority is neither adequately represented in this debate, nor given adequate data to decide on whether they would be comfortable with the resultant premium increase. 

Health insurance involves many difficult trade-offs. Allowing greater freedom of choice often results in higher prices. Do all policyholders agree that having this greater freedom justifies these price increases? To what extent do policyholders with different health conditions benefit from this choice? 

The data needed to support an inclusive and informed debate on portability, continuity of care, and other aspects of IP design is not available. That needs to change. Policyholders of different profiles must be heard.

With this data and the knowledge of how much they are willing to spend on health insurance, policyholders can more meaningfully participate in the dialogue around creating and designing IP products with insurers and healthcare providers.

Portability, and the sense of freedom to choose, is appealing. But let’s bear in mind the lesson learnt from the introduction of the “as charged” concept into IPs. It is a popular product feature which makes policyholders feel less restricted when choosing how they consume healthcare, but it also triggered the “buffet syndrome”, with painful premium increases in the following years. Subsequently, the feature had to be scaled back to keep IPs sustainable. 

Choices have a cost. We should all understand this cost and choose wisely.

Alex Lee
President
Singapore Actuarial Society