Media Briefing by the Medishield Life Review Committee (1 Mar 2014)

MEDISHIELD LIFE REVIEW COMMITTEE RECOMMENDS SIGNIFICANT ENHANCEMENTS FOR MEDISHIELD LIFE

1             The MediShield Life Review Committee has made its preliminary recommendations for the MediShield Life benefit parameters, as well as the approach towards bringing in the currently uninsured.   They are as follows:

(a)  To remove the lifetime claim limit;

(b)  To increase the daily claim limits for normal wards and Intensive Care Unit (ICU) wards by up to 55%;

(c)  To substantially increase the claim limits for outpatient cancer chemotherapy and radiotherapy treatments, to better cover the cost of subsidised cancer treatment;

(d)  To halve co-insurance rates; and

(e)   For Government to take on most of the costs of universal coverage, with the remaining costs to be shared among the currently uninsured with pre-existing conditions and the larger pool of existing insured policyholders. 

Preliminary Recommendations

MediShield Life Benefit Parameters

2             The Committee agrees that MediShield Life’s focus should remain on large subsidised hospital bills, as these are the bills that most concern Singaporeans.  In comparison, the smaller and more predictable bills can be covered by Medisave and other savings.  This reflects the views from participants at the FGDs, who agreed on the importance of providing greater protection for the larger bills.

3             Based on the above considerations, the Committee recommends the following enhanced MediShield Life parameters (details are in Annex A).

-       Increasing daily claim limits by between 33 and 55% for normal wards and ICU wards, to adequately cover most large Class B2/C bills;

-       Increasing claim limits for outpatient cancer chemotherapy and radiotherapy treatments, to better cover the cost of subsidised cancer treatment;

-       Halving the co-insurance rates borne by patients to 5-10% for inpatient and 10% for outpatient bills, to reduce their financial load, especially for the larger bills; and

-       Removing the current lifetime limit of $300,000, to allow Singaporeans who accumulate large bills to remain covered for life.

4             These proposed enhancements are expected to result in the following improvements in benefits and payouts for Singaporeans (Annex B shows the impact of the proposed enhancements for some patient bill examples):

-       With MediShield Life, every year, close to 10,000 more subsidised Class B2/C patients will pay less than $3,000 for their inpatient bills. Most Singaporeans would be able to pay for this with Medisave, and those who cannot afford any remaining amounts after MediShield Life and Medisave can apply to Medifund for support.

-       1,500 more subsidised patients undergoing chemotherapy would pay less than $1,000 in a year (in Medisave and cash), after MediShield Life payouts.

Approach Towards Bringing in the Uninsured

5             With MediShield Life providing universal coverage for all Singaporeans, the currently uninsured, including those with pre-existing conditions, will be able to join MediShield Life and be covered for large subsidised bills.  Those who are currently insured under MediShield with exclusions for certain conditions will also have their exclusions lifted and conditions covered under MediShield Life. 

6             The Committee recommends that the uninsured be brought into the common MediShield Life risk-pool, to maximise the effect of risk-pooling, instead of setting up a separate fund for those with pre-existing conditions.  To address the issue of the additional costs arising from the expected higher claims from those with pre-existing conditions, the Committee’s preliminary view is that the cost of universal coverage should be shared across those with pre-existing conditions, the existing insured policyholders, and the Government.   In doing so, a balance would need to be struck between greater societal support and inclusiveness, and having those with pre-existing conditions pay higher premiums reflective of their higher risks. The Committee will continue to consult Singaporeans on the approach to sharing the cost of universal coverage. As this is a one-off measure to bring in the uninsured as a result of MediShield Life becoming universal, the Committee also calls on the Government to support most of the costs of universal coverage.

7             These preliminary recommendations were based on reviews by the MLRC as well as inputs obtained from more than 20 Focus Group Discussions (FGDs) conducted with members of the public and key stakeholders.

Next Steps

8             Based on the preliminary recommendations, the Committee has requested MOH and its actuarial consultants to provide premium estimates to aid the Committee in its further deliberations. 

9             As premium affordability has been a significant concern raised during the public consultation process, the Committee welcomes the Government’s assurance that premiums will remain affordable through subsidies for the lower- and middle- income, as well as special subsidies for Pioneer Generation seniors.

10          The Committee will also continue to study issues that have been highlighted by members of the public and experts, some of which will also have premium implications. These include reviewing: the extent of further pre-funding or front-loading of premiums during the working ages; deductibles; additional outpatient treatments; other healthy living incentive features; and the impact on Integrated Shield Plans.

11          The Committee will continue to consult Singaporeans so as to develop a set of good and sustainable recommendations that will give Singaporeans peace of mind from large subsidised hospital bills.

ANNEX A

ANNEX B

Impact of Proposed Benefit Parameters on MediShield Life Payout

Figure B-1: Illustration of impact of current and proposed benefit parameters on MediShield Life payout

MediShield payout with current benefit parameters

MediShield payout with proposed benefit parameters

Table B-1: Example of a stroke patient

Ward Class: Class B2

Length of Stay: 9 days

Medical Condition: Stroke

This is an example of a large bill at the 90th percentile, where the bill size is $4,615 after Government subsidy.  An estimated 10 out of 100 subsidised B2/C bills are of this amount or higher.

Table B-2: Example of a patient with bleeding in the brain

Ward Class: Class C

Length of Stay: 15 days (1 day in ICU)

Medical Condition: Bleeding in the Brain

This is an example of a very large bill at the 98th percentile, where the bill size is $10,050 after Government subsidy. An estimated 2 out of 100 subsidised B2/C bills are of this amount or higher.

Table B-3: Multiple-bill example of a cancer patient undergoing chemotherapy

Outpatient Subsidy Status: Class C

Number of outpatient episodes/bills: 4 cycles/bills of chemotherapy treatment in the year

Medical Condition: Lung Cancer

This is an example of large annual chemotherapy bills at the 75th percentile, where the cumulative bill size is $6,780 after government subsidy. An estimated 1 out of 4 subsidised chemotherapy patients will incur bills of this amount or higher in a year.

MediShield Life Review Committee