BRANDED CONTENT
askST: What's driving the significant increase in MediShield Life premiums?
MediShield Life premiums will go up following a review of the scheme, but support measures are available to cushion the blow
MediShield Life will be enhanced to better protect Singaporeans against large medical bills, and enable them to afford new, potentially life-saving treatments.
PHOTO: GETTY IMAGES
Last month, the Ministry of Health (MOH) announced upcoming changes to MediShield Life, following a review by the council tasked with ensuring that the national health insurance scheme is effective.
Recommendations from the MediShield Life Council include increased claim limits, expanded outpatient coverage and the inclusion of new, high-cost treatments. The changes will take effect from April 2025.
Here are some common questions on how these changes might impact Singaporeans financially.
Q: Will I have enough in my MediSave account as MediShield Life deductibles and premiums go up?
A: As part of the changes to MediShield Life, the inpatient deductible – which is the amount a policyholder must pay before a MediShield Life claim can be made – will also increase by up to $1,500. It can be paid using MediSave.
More assistance will be provided to the lower- and middle-income individuals in older age groups. From April 1, 2025, they will be able to receive MediShield Life premium subsidies of up to 60 per cent, from up to 50 per cent today.
Those who are unable to afford their MediShield Life premiums even after government subsidies and MediSave use can apply for additional support. More details can be found on moh.gov.sg/healthcare-schemes-subsidies/medishield-life/medishield-life-faqs
Q: What’s driving the significant increase in premiums?
A: MediShield Life premiums are set to rise by an average of 22 per cent across all age groups. The increase is mainly due to:
- Rising healthcare costs due to advancements in medical technology and intensifying competition for medical manpower globally. The increasing prevalence of chronic diseases such as diabetes also resulted in higher healthcare consumption.
- Rise in medical claims due to newer, more advanced types of treatment and care. For example, advancement in orthopaedic surgeries have made knee replacements much easier to do, leading to more claims from the procedure. The rate of total knee replacement surgeries has increased from 187 patients for every 100,000 people aged 65 and above in 1999 to 499 patients in 2019, says MOH.
- Increase in claim limits and MediShield Life coverage expansion. For example, daily claim limits for intensive care unit ward stays will more than double from $2,200 to $5,140. The claim limit per policy year will rise from $150,000 to $200,000.
MediShield Life coverage will also be extended to new, potentially life-saving treatments, such as cell, tissue, and gene therapy products (CTGTPs) which use cells to treat or reverse various health conditions.
More on healthcare costs
- News analysis: The recent review of MediShield Life revealed what Singapore's healthcare priorities will be in the coming years, reflecting the sober reality of rising medical costs in an ageing society.
- A wider shield: With the new changes to the national insurance scheme, nine in 10 patients will pay nothing out of pocket for their medical bills.
Q: Will MediShield Life premiums become unaffordable for many Singaporeans, like some private insurance plans?
A: MediShield Life is designed to remain affordable for Singaporeans while providing protection for large medical bills. MOH and the MediShield Life Council use these strategies to keep its premiums manageable:
- Focused coverage for larger bills
MediShield Life addresses significant healthcare costs using features like claim limits, deductibles (the amount a policyholder must pay before a MediShield Life claim can be made), and co-insurance (the percentage of the claimable amount that a patient has to pay after the deductible). This approach helps prevent overuse of insurance, which can drive up premiums.
- Regular reviews to control costs
For example, the Cancer Drug List, introduced in Sept 2022, focuses MediShield Life coverage on effective and affordable cancer treatments. Since then, it has led to a drop in cancer drug prices by an average of 30 per cent, and over 60 per cent for some drugs, said MOH in August.
- Extending coverage only to clinically proven and cost-effective treatments
MediShield Life coverage is only extended to new, expensive treatments that are both clinically proven and cost-effective. This helps to manage claims growth while improving access to life-saving care.
Q: Will the MediShield Life review have any impact on premiums for Integrated Shield Plans (IPs)?
A: It will depend on your insurer.
Your IP premium is made up of two parts: The MediShield Life premium, and the premium for the additional private insurance component.
Once the changes to MediShield Life kick in, your MediShield Life premium component will increase. The pro-ration factor for A and B1 ward classes in public hospitals, as well as private hospitals, will also be reduced.
The pro-ration factor is the percentage of your medical bill upon which MediShield Life claims are calculated. For example, with the recent changes, your MediShield Life claims will be calculated based on just 10 per cent of a private hospital bill, down from 25 per cent. For the A ward class, it drops from 35 to 25 per cent.
A lower pro-ration factor means that the IP will have to foot a bigger share of the medical bill.
Other MediShield Life changes, such as higher claim limits, may offset some of this impact. But ultimately, revisions to the private insurance component of your IP premium will depend on your insurer.
In partnership with the Ministry of Health
