MediShield Life review: Committee recommends standardised B1-class integrated shield plan

SINGAPORE - Private insurers should offer a standardised integrated shield plan providing coverage for B1-class wards, said the MediShield Life review committee on Friday. Doing so would give people better coverage than MediShield Life, but still be much cheaper than plans targeted at A-class wards or private hospital stays.

Integrated shield plans (IPs) comprise the basic CPF-run MediShield plan, which covers ward stays at Class B2 or C level, as well as an add-on plan from a private insurer that upgrades the ward stay to Class B1 or A and also boosts claim limits.

Such plans include NTUC IncomeShield, AIA HealthShield, Great Eastern SupremeHealth, Prudential PruShield and Aviva MyShield.

About 60 per cent of Singaporeans have IPs. The committee noted that some people had "overstretched themselves" buying expensive plans without considering their long-term cost. "This happens more often during the working years when premiums can be paid for wholly or mostly through Medisave," it noted.

Yet in the end, about seven in 10 of those who have plans targeting A-class wards eventually choose to stay in lower ward classes when hospitalised. The corresponding figure for those with plans targeting private hospital stays is six in 10.

The committee recommended that the Government work with the private insurance industry to come up with key features of the new B1 integrated shield plan. The standardised plan's cheaper premiums should address concerns over high IP premiums, especially at older ages.
It should also reduce the current confusion among the public over the difference across various IPs.

The committee said that this new plan should be made available to all new and existing IP holders, who may wish to downgrade from pricier plans with coverage up to class A wards or private hospitals. Premiums for this new plan should also form the basis for setting the Medisave withdrawal limits for IPs.

Finally, the committee also urged the Government to improve the regulatory framework for IPs in order to better safeguard policyholders' interests. This includes setting clearer guidelines and rules in the selling of such plans.

The Life Insurance Association, which represents the five IP insurers, said that there would be "minimal impact" on the top-up portions of IPs when MediShield Life kicks in.

LIA president Khoo Kah Siang also said that the association will work with the Government and other relevant groups to address concerns over Singapore's rising medical inflation. "This includes improving price transparency of professional fees within the healthcare industry, reviewing how benchmarks for such fees could support cost management efforts for IPs, as well as the opportunity to analyse data to allow for better scrutiny of unusually high bills."

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