Gan: Weigh cost benefits of private health plans

Gan: Weigh cost benefits of private health plans
Health Minister Gan Kim Yong.

WITH MediShield Life expected to offer better payouts than the current national health insurance scheme, Health Minister Gan Kim Yong has urged people with private coverage to weigh up the cost benefits of maintaining it.

MediShield Life, which will cover all Singapore residents for life, is expected to start late next year.

In an exclusive interview with The Straits Times, Mr Gan said people with Integrated Shield Plans (IPs) should ask themselves if they really need a private plan, bearing in mind two things.

One is whether they can afford the premiums.

"Not just the premiums they are paying today, but when they get older," he said, adding that current ones provide a guide, but they are likely to change over the years.

"The main uncertainty is the development of medicine. New treatments, new regimes, new models of care can drastically change health-care costs."

The second important consideration, he said, is the class of ward people intend to go to should they fall seriously ill.

If they plan to seek treatment in a subsidised ward in a public hospital, then the basic MediShield Life should be sufficient.

Mr Gan said: "If your intention is to go for subsidised treatment, there is really no need for a private Shield plan."

But if people intend to stay in a private ward or hospital, they would be better off with an IP.

He also quashed fears that people could be forced to seek private care because public hospitals are currently bursting at the seams.

The minister promised that new hospitals, such as those due to open in Jurong later this year and in Sengkang by 2018, will meet the needs of an expanding and ageing population.

But he stressed that it is important for people to choose "appropriate" care rather than "excessive" care.

Two out of three people in Singapore have IPs offered by five private insurance companies.

These companies will need to make changes to their various plans to include the new premiums and claims benefits that will come when MediShield Life is introduced.

People with existing illnesses who are not currently covered by insurance will face 30 per cent higher premiums than others in their age group for 10 years when they join MediShield Life.

However, Mr Gan assured that there will be no such penalty for people who stay on an IP while they are young and the premiums are relatively low, and then downgrade to MediShield Life when they get older.

IPs already incorporate the basic MediShield insurance.

Although the MediShield Life Review Committee will submit its report to the Government at the end of this month, Mr Gan said it will take more than a year to implement the scheme due to the major shift in health-care financing policy and the structural changes it involves.

"This requires system changes both at the hospital and insurance level, as well as working with private insurers to make sure the interface is properly managed," he said.

"It is quite a complex scheme, and we need time to implement it properly."

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