MOH exploring MediShield cover for congenital illnesses

28 Sep 2009, The Straits Times

Question

Name of the Person: Stanley Jeremiah

Work towards MediShield for all without exception

IN ITS reply on Monday, 'Government working to raise MediShield coverage', the Ministry of Health (MOH) stated that one way to lower premiums significantly - for those with congenital illnesses - is for the majority of Singaporeans without congenital illnesses to cross-subsidise them through higher premiums across the board.

Is this not the primary purpose of having a national medical insurance scheme?

Insurance schemes should spread the risk and provide a mechanism so the misfortunes of a few can be shared by many, thus making the burden bearable.

MOH says this requires the support of Singaporeans. Should the ministry not take on the responsibility to win the support of Singaporeans to ensure that the basic well-being of those who suffer from congenital illnesses, through no fault of their own, are addressed?

To do this, MOH may also wish to elaborate on the claims experience and loss ratios of the MediShield scheme. To date, Singaporeans have not been given an insight into the profitability of the MediShield scheme. The public must understand why they have to pay more in MediShield premiums to cover those with congenital illnesses. If people understand, they may well be willing to pay slightly more to benefit all Singaporeans.

Families who have been unfortunate to have children with congenital illnesses suffer serious financial hardship in addition to emotional stress.

Medifund helps the destitute but what about middle-class families?

This may also be one reason why many middle-class couples avoid having children or more than one child. The risk to their financial well-being, if something goes wrong, is too great.

The burden is too heavy for individual families to cope, unless there is assistance from a national health-care insurance system.

Reply

Reply from MOH 

IN HIS letter last Friday, 'Work towards MediShield for all without exception', Mr Stanley Jeremiah urged that MediShield be extended to cover those with congenital illnesses. We are studying the proposal with our actuaries.

There are two ways to help these patients: through MediShield so the healthy cross-subsidise those with congenital conditions, and/or through government subsidies and Medifund whereby taxpayers help fund their bills. The former will require an increase in MediShield premiums, while the latter will raise the tax burden on all.

There are trade-offs to be made. For example, if MediShield premiums become too high, more people, especially the healthy, may opt out, and the MediShield risk pool will be compromised.

Mr Jeremiah asked about loss ratios and profitability of the MediShield scheme. This is public information. MediShield is non-profit-making.

However, this does not mean its annual premium collections must only just cover the claims that year, which is a short-term approach.

Unlike group health insurance, much of which is renewed annually, MediShield must build up sufficient reserves to fund future claims as it is a long-term health insurance policy. Most policyholders are likely to claim only in the future when they age.