Factsheet on the MediShield Life Scheme Bill

1.            The MediShield Life Scheme Bill will be tabled for First Reading in Parliament on 19 January 2015. The Bill provides for the implementation and administration of the MediShield Life Scheme, which will provide better protection for all Singaporeans for life against large hospital bills. 

Background

2.            In July 2014, Parliament unanimously supported the White Paper on “MediShield Life Review Committee Report”, which set out the recommendations of the MediShield Life Review Committee on the design of the MediShield Life Scheme (Refer to Annexes A and B for more details and for the glossary of terms).

3.            MediShield Life, which will replace the current MediShield Scheme in end-2015, will provide better benefits and protection; universal, lifelong coverage for all Singapore Citizens and Permanent Residents, including those with pre-existing medical conditions; and better protection against large hospital bills.      

4.         To help Singaporeans with their MediShield Life premiums, the Government will provide close to $4 billion over the next 5 years in premium subsidies and other forms of support. This includes the Government bearing the bulk of the cost of extending coverage to those with pre-existing conditions, Premium Subsidies for lower- to middle- income Singaporeans, Pioneer Generation Subsidies for our Pioneers, Transitional Subsidies for all Singapore Citizens and Additional Premium Support for those who are needy and unable to afford their premiums.

Key Features of the Bill

5.            The MediShield Life Scheme Bill sets out the legislative framework and powers for the implementation and administration of the MediShield Life Scheme. The key features of the Bill are:

a.    Universal Coverage and Benefits (Sections 3 and 4)

The MediShield Life Scheme will apply to all Singapore Citizens and Permanent Residents for life. The detailed benefits under the Scheme will be set out in regulations. The Bill also provides for the payment of premiums, including allowing for the deduction of Medisave monies for premium payment. For minors below the age of 21, their premiums will be borne by their parents or legal guardians, if they do not have sufficient Medisave.

b.    MediShield Life Council (Section 8)

The Bill will establish the MediShield Life Council, which will have the following functions:

• Review and make recommendations to the Minister on MediShield Life policy and scheme parameters to ensure that the Scheme provides effective protection for Singaporeans;

• Review the administration of the Scheme to ensure alignment with the directions of the Council; and

• Advise the Minister on other matters related to the Scheme and the MediShield Life Fund.   

c.    Recovery of Premiums (Sections 11 to 18)

MediShield Life is a national scheme that is mandatory for all Singapore Citizens and Permanent Residents. All will need to contribute premiums promptly to ensure that the Scheme can meet its commitments to policyholders, as premium defaults will affect the sustainability of the scheme and result in higher premiums for all.

The Bill provides for a robust framework to recover outstanding premiums from defaulters, with powers adapted from existing income tax legislation. These include powers to:

• Impose penalties on outstanding premiums, of up to 17%, including any interest on late premiums;

• Appoint agents (such as employers, banks, and tenants) to make payment for outstanding premiums from any sums held by the agents for the defaulters, or any sums due by the agents to the defaulters; and

• Sue the defaulters to recover outstanding premiums.

d.    Access to Information to Facilitate the Extension of Premium Subsidies and Scheme Administration (Sections 26 to 30)

To support the extension of MediShield Life premium subsidies to eligible Singaporeans from lower-to-middle income households, as well as facilitating the administration of the Scheme, the Bill will enable authorised persons administering the scheme to access financial and medical information in Government and administrative databases. This will:

• Facilitate eligibility checks for MediShield Life premium subsidies, through the access and use of information from various Government and administrative databases. This includes basic administrative information such as residential addresses and the Annual Value of residences, as well as financial data, such as income. Individuals may choose not to allow access to their financial data. However, such individuals will have to apply manually to be assessed for premium subsidies; and

• Facilitate the processes and checks required to identify those with serious pre-existing medical conditions for the purpose of extending universal coverage to them under MediShield Life. Those with serious pre-existing conditions would have to pay additional premiums (30% more) for 10 years, to reflect their higher risk. Individuals may choose not to allow access to their medical information. However, such individuals will have to pay the additional premiums.

Only authorised persons may access the information for the purpose of administering authorised schemes. Persons who access, use or disclose such information without authorisation may be punished with up to $5,000 fine or 12 months’ imprisonment or both.

e.    Offences and Penalties (Sections 19 and 25)

Under the Bill, it is an offence to:

• Knowingly provide false or misleading information or omit material information. Individuals convicted of such offences may face up to $5,000 fine or 12 months’ imprisonment or both, and additionally be required to pay penalties pegged to the amount of premiums undercharged or benefits or claims overpaid; and

• Obstruct investigators who are investigating into offences under the Bill without reasonable excuse.  Persons convicted of such offences may face up to $20,000 fine or 12 months’ imprisonment or both.

Conclusion

6.            The Bill will be tabled for its Second Reading at the next available sitting of Parliament.