INTRODUCTION
1. Mr Deputy Speaker, many Members have spoken about CareShield Life. I would like to thank them for their contributions.
PLANNING FOR LONG-TERM CARE
2. Young Singaporeans typically think about long-term care as something that is not important, and which is not on their radar. In fact many of them regard these as issues for the old.
3. That is why it is important to address this issue now. And very often, we only realise how important these issues are when we have to take care of someone who is severely disabled. As the experience of Dr Chia’s grandmother has shown, this often happens quite suddenly and we are not prepared for it.
4. Therefore today, I am happy that we have an opportunity in this House to talk about CareShield Life. I am encouraged that members of this House have voiced support for the introduction of CareShield Life to provide better protection and greater assurance compared to the current ElderShield.
CONTRIBUTIONS FROM MEMBERS
5. Members have made very thoughtful remarks and suggestions, and shared concerns which Singaporeans might have. Some of these relate to the design of the scheme, who it should cover, its benefits, its features and how it will be managed. These are questions that are important. There were questions about affordability, concerns about how Singaporeans without CareShield Life or those who need additional help can get support.
6. My Senior Ministers of State Dr Amy Khor and Mr Chee Hong Tat have addressed most of the concerns and questions raised. Allow me now to sum up the debate on long-term care and CareShield Life.
INCLUSIVITY
7. First, CareShield Life will be an inclusive scheme. It will be more than just an insurance scheme but a key pillar of our social safety net.
8. This is why we are introducing universal coverage for future cohorts – Singaporeans born in 1980 or later, so that the scheme will cover all future generations including those with pre-existing severe disabilities, as well as those who are low-income who need it the most as they will receive premium support.
9. We have explained why it is not possible to make it mandatory for all Singaporeans in the existing cohorts – meaning those born in 1979 or earlier – to join CareShield Life. We will however encourage them to do so, with participation incentives. In line with our inclusivity principle, those with pre-existing conditions but are not severely disabled will also be allowed to join the scheme.
AFFORDABILITY
10. On affordability, some Members of the House have raised concern about what will happen if there are people who may not be able to afford their premiums. These include the self-employed, housewives, and the low income.
11. I would like to assure Members of the House that no one who joins CareShield Life will lose their coverage due to inability to pay premiums.
12. The Government will provide means-tested premium subsidies for the low to middle income Singaporeans as a permanent feature of the scheme. And for those who still are unable to afford their premiums after subsidies and family support, we will extend Additional Premium Support. In other words, the financially needy will receive additional support from the Government on their premiums.
13. Making sure that CareShield Life premiums remain affordable also requires a delicate balance between benefit enhancements and their impact on premiums. I thank Members of the House for their various suggestions on how CareShield Life features could be enhanced, such as higher payouts, or allow claims for less severe disabilities. While these suggestions are well intended, we have to balance these enhancements against premium affordability. Higher payouts, easier claim criteria and better benefits will result in higher premiums. We also should bear in mind that insurance payouts are not the only source of long-term care funding. Personal and family savings, other government subsidies and safety nets and community support also play a role.
14. This is the reason why the ElderShield Review Committee recommended that CareShield Life should provide a basic level of protection for Singaporeans. Singaporeans who prefer additional insurance cover have the option to buy supplements from private insurers using their MediSave savings, according to their individual preferences and financial resources.
15. That said, ensuring that CareShield Life remains affordable is just one part of the larger picture. I agree with Dr Chia Shi-Lu, Mr Christopher de Souza and Mr Chen Show Mao, that we do need to pay attention to maintaining and managing long-term care costs. We will continue to do our best to work with all our stakeholders to better manage our long-term care costs. But all of us will also have a role to play to stay healthy and prevent ourselves from falling into disability.
SUSTAINABILITY
16. Third, let me emphasise that CareShield Life, being a vital part of our future social safety net, must be sustainable for generations to come.
17. To ensure long-term sustainability, each cohort will fund its own future needs through pre-funding. The scheme is not intended for younger generations to cross-subsidise the older generations. Other countries have found such pay-as-you-go systems difficult to sustain.
18. To be sustainable, premiums must be priced in accordance with sound actuarial principles. To ensure this, an independent council will be established through legislation to advise the Government on premium and payout adjustments.
19. I would also like to emphasise again that the Government will administer CareShield Life on a not-for-profit basis. All premiums collected will go into the CareShield Life Fund for the benefit of policy holders. If the real life claims experience turns out better than expected, the savings will be part of the Fund and policy holders will benefit from it through premium rebates, slower premium growth or better payouts.
SUPPORT FOR THOSE WHO DO NOT JOIN CARESHIELD LIFE
20. Mr Deputy Speaker, CareShield Life is designed to be an inclusive, affordable and sustainable insurance scheme, and a key pillar of our social safety net. It will work hand in hand with personal and family savings, and Government and community support to help our future generations of Singaporeans afford long-term care.
21. We note however that some among our existing cohorts may not join CareShield Life. Others may need additional support beyond CareShield Life. This is why we have decided to enhance our long-term care financing system in two other ways.
22. MediSave will be allowed to be withdrawn in cash to support long-term care costs. Because the payout is in cash, it provides flexibility, whether one is cared for informally at home or formally through a provider or residential facility.
23. We will set up ElderFund, an additional government-funded safety net for low-income Singaporeans who are severely disabled and are in need of support.
24. Together, these three initiatives – CareShield Life; use of MediSave for long-term care; and ElderFund – form a comprehensive package of measures that will significantly strengthen our long-term care financing.
25. I agree with many Members that CareShield Life and the other two long-term care enhancements are not easy for Singaporeans to understand.
26. We will initiate more communications and engagement efforts to explain the schemes to Singaporeans and how they can tap on them to support their long term care needs.
27. I hope that through this debate and our outreach efforts, Singaporeans will be more aware about their long-term care needs, and start to think about their long-term care needs and plan for it. I hope that we will all have good health, and stay active and free from disability. But should disability strike, we can have the peace of mind that our long-term care needs are well supported.
CONCLUSION
28. On that note, let me urge Members of this House to support the motion. And give our fellow Singaporeans better protection and better assurance through CareShield Life.
29. Thank you.