MediShield Life premiums will be kept affordable

We refer to recent letters on the MediShield Life review.

MediShield Life premiums are actuarially determined, with each age group paying premiums to broadly support their own needs. Premiums are higher for seniors as they are more likely to be hospitalised, with longer hospital stays. Among seniors above 80 years old, almost one in four received MediShield Life payouts last year, with an average payout of $5,200 per claimant.

The higher deductible for this group keeps their premiums more affordable by focusing MediShield Life coverage on the larger bills.

Lowering the deductible will result in even higher premiums for all seniors. Those with financial difficulties with their co-payment can seek assistance from public healthcare institutions, including tapping MediFund.

Designing premiums so that the young pay for the old is unsustainable given our ageing population.

The Government provides permanent premium subsidies for lower- and middle-income Singaporeans instead, which increase with age and are up to 50 per cent for the elderly.

Regardless of their household income, all Merdeka Generation (MG) seniors receive additional MG subsidies of 5 per cent or 10 per cent, on top of the premium subsidies.

All Pioneer Generation (PG) seniors receive special subsidies of 40 per cent to 60 per cent.

MGs also receive Medisave top-ups of $200 annually from 2019 to 2023, while PGs receive $200 to $800 annually, for life. Family members can also utilise their Medisave to help pay the premiums for their loved ones.

Information about the MediShield Life Fund, including the yearly premiums collected and payouts, is available on the Ministry of Health (MOH) website.

MediShield Life is a not-for-profit scheme. Collected premiums are used solely for the administration of the scheme and the benefit of policy holders.

Slowing the rise in healthcare costs is key to maintaining overall affordability and everyone can help to keep healthcare costs sustainable.

The MOH has published fee benchmarks and appropriate care guides to encourage the appropriate use of healthcare services by doctors and patients.

The ministry has also worked with Integrated Shield Plan (IP) insurers to introduce a minimum 5 per cent co-payment for all new IP riders so that healthcare decisions are carefully considered.

Together, appropriate care can remain affordable for all Singaporeans. Singaporeans will not lose their MediShield Life coverage or be denied access to appropriate care because of an inability to pay.

Cham Dao Song
Director, Finance Policy
Ministry of Health