MediSave to pay for higher MediShield premiums

Premiums for Singaporeans’ basic health insurance plan look set to increase, as MediShield Life is made to work harder, provide more assurance against large medical bills, and pay for new ground-breaking treatments.

Recommendations by an expert panel on the review of the scheme are expected by the second half of 2024, said Health Minister Ong Ye Kung during the debate on his ministry’s budget on March 6.

MediShield Life is a basic, mandatory health insurance plan launched in November 2015 to protect all Singaporeans against large medical bills for life, regardless of pre-existing conditions.

It helps Singaporeans pay for large bills in B2 and C wards, which are subsidised wards, and is meant to cover nine in 10 subsidised bills.

But that is no longer the case today, Mr Ong said.

“This nine-in-10 benchmark is being eroded, because hospital bills are getting larger and larger.”

Bill sizes have grown by 5 per cent annually in public hospitals, and by 7 per cent annually in private hospitals over the last few years, he said.

As a result, the proportion of subsidised bills adequately covered by MediShield Life has come down to around eight out of 10, and is expected to slip further.

The practical impact of that is that subsidised patients are seeing unexpectedly large hospital bills, he pointed out. After the subsidy and MediShield Life, there is still a substantial out-of-pocket component left.

This is when higher healthcare costs start to bite.

MOH has, therefore, tasked the 11-member MediShield Life Council to comprehensively review the scheme, said Mr Ong.

The last time it was reviewed was in 2020, when premiums went up by 25 per cent on average.

MOH had said in 2019 that it will review claim limits for MediShield Life coverage every three years or so.

The MediShield Life Council is headed by Mrs Fang Ai Lian, the former chairwoman of Ernst & Young. It has already begun the review process, and will look into three key areas.

First, the council will look into enhancing MediShield Life to give Singaporeans greater assurance against large bills. This means increasing the claim limits – how much a patient can claim from MediShield Life – for both surgeries and hospital stays.

“We envisage a fairly significant increase in the claim limits. For example, for an episode involving angioplasty, where a stent is placed into your heart to open a blocked artery, plus, say, a few nights of ICU stay, the claim limits may need to double. This will reduce out-of-pocket costs significantly,” said Mr Ong.

Second, the council will look at enhancing other outpatient coverage.

Mr Ong said that there is a need to raise the claim limits for treatments such as kidney dialysis to reduce out-of-pocket expenses for patients.

The council will also explore extending coverage to more types of outpatient care and consider expanding MediShield Life coverage to new ground-breaking treatments, specifically cell, tissue and gene therapy products, also known as CTGTPs.

Mr Ong pointed out that with medical science advancing rapidly, CTGTPs have the potential to revolutionise healthcare and deliver effective treatment of previously incurable diseases. Some describe it as the equivalent of a moonshot in healthcare, he said.

“However, while the technology is promising and advancing fast, it is nascent and very expensive. It could cost anything, from a few hundred thousand dollars to a few million dollars per treatment,” said Mr Ong.

“We want to start including CTGTPs under MediShield Life coverage. But we need to put in place safeguards to ensure that financing of CTGTPs is sustainable.

“For instance, we will need to extend MediShield Life coverage only to treatments that are assessed to be safe, clinically effective and cost-effective,” said Mr Ong.

While the proposed changes will better protect subsidised patients against major health episodes, MediShield Life premiums will inevitably go up, he said.

“But rest assured that we will do the necessary to ensure that as far as possible, premiums can be paid fully by MediSave,” said Mr Ong.