The Ministry of Health (MOH) has asked insurer AIA not to reduce the payout to policyholders when they switch to a different plan. Its response comes after The Straits Times alerted MOH about the affected policyholders.
A spokesman for MOH said it has directed AIA to review cases "where policyholders have seen their coverage compromised" to ensure that they meet the regulations and conditions of Integrated Shield Plans. These are medical insurance plans whose premiums can be paid for with Medisave.
AIA told The Straits Times that fewer than 20 people are affected.
One of them is Madam Esther Sim, who has been going for dialysis treatments since March last year. Her original medical insurance plan helped pay for 90 per cent of her treatment cost.
But last year, AIA told her that her plan would be discontinued and she would be moved to the AIA HealthShield Gold Max B, which has better benefits. Her premiums would go up by about $300 a year to $1,119. She felt she had no choice but to go along.
Then, to her shock, she found out the new policy covers only 70 per cent of the cost of her dialysis treatments, which she does at a private centre near her home. As a result, the amount she has to top up in cash has more than tripled.
The new policy allows full claims for public institutions, but 70 per cent for private centres. Her original policy did not discriminate between the two.
The housewife, who is in her 60s and married to a part-time taxi driver, said she was willing to pay the higher premiums, but not when she gets reduced benefits. Because she will need dialysis for the rest of her life, she appealed to AIA, only to be advised to seek treatment at a public dialysis centre. When she asked for the reinstatement of the previous policy, AIA said it was not possible.
In response to queries from The Straits Times, AIA said its new plan "has new and additional benefits, aligned with the enhanced MediShield scheme on larger bills and prolonged illnesses. For outpatient treatments, we recognise that a small group of policyholders may receive a lower payout".
But following the intervention by MOH, AIA says that it has "reviewed and enhanced" the new plan so that "policyholders in the similar situation as Madam Esther Sim receive equitable coverage for outpatient renal dialysis treatment in a private hospital or private medical institution".
MOH said: "MOH understands that AIA is now in the process of revising their AIA HealthShield Gold Max B policy and will announce the details of the revisions in due course."
Madam Sim's daughter Rachel Lim said her mother appreciates what MOH has done to help her regain her previous benefits. She added AIA has contacted them to say it will send a cheque to reimburse her mother for the additional payment she had made.
Dr Lam Pin Min, chairman of the Government Parliamentary Committee for Health, said: "It is unfortunate that such cases occur, especially when insurance companies are supposed to provide peace of mind and protect the interest of policyholders."
The MP for Sengkang West suggested having "a proper route for redress or even an independent body set up to provide unbiased and professional assessment of such appeals".
He has received numerous complaints from people who said they have been excluded from coverage, even when they have been cured of a medical condition.
He said: "The perception is that many insurance underwriters are overly cautious to the extent of being unfair or unreasonable in their risk assessment. This could either be due to the lack of understanding of the medical condition or being excessively stringent."