The Ministry of Health’s Response to Health Insurance Task Force Recommendations

1. The Ministry of Health welcomes the report by the industry-led Health Insurance Task Force1.

2. The HITF report is timely and commendable. Over the past few years, the Government has taken significant steps to improve healthcare affordability and health insurance coverage for Singaporeans through measures such as the Pioneer Generation Package, subsidy enhancements and MediShield Life. Nevertheless, other stakeholders such as insurers, healthcare service providers, policyholders and patients also have an important role to play and we must work together to ensure the longer-term sustainability of Singapore’s healthcare system.

3. The HITF has made specific recommendations to achieve more efficient and sustainable outcomes for policyholders/patients, healthcare providers and insurers.

4. There is value to improve fee transparency as it bridges the information gap between healthcare providers and patients and enables both patients and healthcare providers to make more informed decisions. MOH now publishes ‘Total Hospital Bill” data for common conditions and “Total Operation Fees” for common surgical procedures for both public and private hospitals. MOH will continue to work with healthcare providers and IP insurers on ways to further improve fee transparency.

5. The design of IPs can also influence healthcare provider and patient behaviour. For example, co-payment is a key tenet in our healthcare financing framework and reflects the importance of personal responsibility for one’s health and healthcare. Co-payment features are incorporated in the design of government subsidies, MediShield Life and Medisave use. For MediShield Life and IPs, co-insurance helps to guard against over-consumption and over-treatment, deductibles helps the insurance to focus on helping patients with the larger bills to ensure premiums remain affordable, and claim limits mitigate the risk of over-charging. However, as observed by the HITF in its report, there are private insurance product features and riders that provide policyholders with 100% coverage without any co-payment. The absence of any co-payment may encourage over-consumption by some patients and over-servicing or over-charging by some healthcare providers which will eventually increase healthcare costs and insurance premiums for all Singaporeans. The HITF’s recommendation is timely and MOH will work with the Life Insurance Association (LIA) and industry players to address these issues.

6. MOH notes that the HITF has also recommended practices to help IP insurers better manage escalating claims costs, such as the use of a panel of preferred healthcare providers and pre-approval of claims. These practices are common among health insurers internationally and are practiced by some insurers that provide group health insurance and employer medical benefit plans locally. LIA and IP insurers should further study these practices, taking into account patient and policyholders’ interests. Insurers should also ensure that their policyholders are properly informed of any changes to their policy terms and that policyholders understand the implications before switching to any new product.

7. MOH would like to thank HITF members for the report. We will engage the insurers, healthcare providers, policyholders and patients in further discussions to carefully study the recommendations. MOH will also work with our partners to reach out to Singaporeans and help them better understand IPs and the HITF’s recommendations. All stakeholders – insurers, healthcare providers, policyholders/patients and the government – need to play our part to moderate the escalation of IP claims and premiums and to ensure that our healthcare system remains sustainable over the long term.

MINISTRY OF HEALTH

13 OCTOBER 2016

1http://www.lia.org.sg/files/news/2016/10/ManagingSingaporeHealthInsuranceCost_HITF_20161013.pdf