Role of pre-funding

We thank Mr David Boey ("Problems with pre-funding"; Nov 19), Ms Maria Loh Mun Foong ("Merits of pre-funding"; last Thursday) and Mr Tan Kin Lian ("Pre-funding not feasible for MediShield Life"; Forum Online, Monday) for sharing their views on the concept of pre-funding for MediShield.

The letters from Mr Boey and Ms Loh may have created the wrong impression that the proposed pre-funding concept will require the younger generation to cross-subsidise the current elderly.

For MediShield, the pre-funded amount contributed by each cohort is set aside for the future use of their own respective cohorts, and not used to cross-subsidise the current elderly.

To address concerns over affordability of premiums among the current cohort of elderly Singaporeans, the Government has indicated its plans to provide help for the older generation of Singaporeans.

As noted by Mr Tan, health-care costs tend to be higher for the elderly. This, plus the effects of medical advancements and changing expectations, will put further upward pressure on future premiums as we age.

For this reason, it will be even more important to set aside some premiums in advance, or pre-funding, to address concerns of premium affordability during old age.

With pre-funding, members pay higher premiums during their working ages and, in return, can receive rebates to offset their own future premiums when they grow old.

With the ongoing review and enhancement of MediShield to MediShield Life, one of the key issues the MediShield Life Review Committee hopes to engage the public on is increasing the role of pre-funding. The committee welcomes all Singaporeans to provide their feedback or sign up for upcoming discussion sessions through www.medishieldlife.sg

Philip Sim

Deputy Director,

Corporate Communications

Ministry of Health

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