Policy updates aim to address medical expenses while shifting care to cost-efficient settings.
Singapore’s recent MediShield Life review has focused on addressing rising medical expenses and adapting to the challenges of an ageing population. The plan aims to provide sufficient coverage for large hospital bills while expanding coverage for outpatient and home-based care, reflecting an effort to manage healthcare costs more sustainably.
With adjustments, MediShield Life will once again cover nine out of ten subsidised bills, as initially intended. Currently, it covers less than eight due to claim limits lagging behind rising medical costs. These updates aim to reassure patients that significant hospital expenses will be covered.
Experts highlight the inclusion of outpatient treatments and community-based care in the coverage, which could help reduce reliance on hospital care. However, the most impactful changes involve reducing payouts for private hospital bills. Pro-ration factors have been revised, significantly lowering the MediShield Life coverage percentage for private hospital and Class A and B1 ward stays.
For example, a private hospital stay that previously saw MediShield Life cover 14% of a $36,750 bill will now only receive 3% coverage under the revised rules. The remaining costs will be borne by Integrated Shield Plans (IPs), company insurance, MediSave, or cash.
With 70% of Singaporeans and permanent residents owning IPs, most with riders to minimize out-of-pocket costs, insurers are expected to face increased payouts. The Singapore Actuarial Society predicts IP premiums will rise as insurers adjust to these changes, possibly leading policyholders to reconsider their plans or shift to more affordable options.
