Revamped MediShield, Medifund and Medisave

28 Feb 2005

Question No:  38  

Question

Name of the Person: Dr Tan Sze Wee, Nominated Member of Parliament

To ask the Minister for Health, in light of the recent announcement to revamp the MediShield system, (a) whether the Medisave and Medifund policies could also be revised in tandem; (b) will there be enough Medisave to cover the increased deductibles for poorer Singaporeans; and if not, (c) what will his Ministry do to ensure that the Medifund or Medisave schemes 'kick in' sooner to tide these group of Singaporeans over.

Reply

Reply From MOH

Our system of financing hospitalisation cost, comprising large government subsidy and some co-payment by patients, supplemented by insurance and employer medical benefits, has served us well. It has helped us deliver a high standard of public hospital services which the vast majority of Singaporeans can afford. 

The system has evolved over the years. We constantly enhance it in the light of experience, so that it remains effective and relevant to our circumstances. 

The current reform of MediShield is part of that evolution. After July 1, we will have a more robust system of leveraging on insurance to help ease the financial burden on Singaporeans. 

Medisave is a key piece in this healthcare financing system. When every Singaporean regularly saves a portion of his income in his Medisave Account, he will over time build up a considerable balance to pay for the hospitalisation needs of himself and his family. 

After 20 years, Singaporeans have collectively accumulated a total of $30 billion in their Medisave accounts. The average Medisave balance exceeds $10,000. This is not a small achievement. In another 20 years, when the scheme matures, when every Singaporean would have started contributing to Medisave as soon as he starts working, we would collectively and individually build up sizeable savings for a rainy day. 

For the current MediShield reform, almost all patients would have enough Medisave to pay for the increased MediShield deductibles. 

For the small minority who are unable to afford their hospital bills, we have Medifund to provide the safety net. As Members are aware, the Government is doubling Medifund to $2 billion, with an immediate injection of $100 mil.