New no-frills insurance plan for higher hospital classes

Singaporeans wanting insurance coverage for a higher hospital class than that provided by the basic MediShield Life can opt for a new standardised package from five private insurers from May 1.

This new Integrated Shield Plan (IP) will cover nine out of 10 Class B1 public hospital bills, and will give people the option for coverage beyond Class B2/C at affordable premiums.

The Ministry of Health (MOH) worked with the five private insurers to develop the key features of the new Standard IP, following public feedback to the MediShield Life Review Committee that there was demand for such coverage.

Class B1 offers some benefits over the lower Class B2/C such as air-conditioned four-bed wards, instead of non-air-conditioned wards with six beds or more, and the option to choose one's doctor.

People now on Class B1, Class A or private hospital plans would also be able to switch to this option.

The benefits of the new IP are identical across insurers, with claims limits such as $1,700 a day for a patient in a B1 ward, and $2,900 a day in intensive care.

But the five insurers will be charging different premiums, which can differ by as much as $1,683 a year.

In announcing the new IP yesterday, MOH said this was due to "each insurer's commercial considerations and risk assessment frameworks".

Launched last November, MediShield Life gives all 3.9 million Singaporeans and permanent residents a basic health insurance plan which covers them for life.

It helps to pay for large subsidised hospital bills and selected outpatient treatments, such as dialysis and chemotherapy.

Those who choose to stay in a Class A or Class B1 ward or in private hospitals can buy an IP for additional coverage.

Almost two in three people have IPs, of which 56 per cent are for private hospitals, 25 per cent for Class A and 19 per cent for B1. There are seven B1 IPs, but only four accept new policyholders.

The new standard no-frills B1 plan, like MediShield Life, does not pay for pre- and post-hospital treatment, unlike most IPs now.

The five insurers will send letters to existing B1 policyholders to offer them the choice of switching to the standard plan. As agreed with MOH, they will not raise premiums for two years. Premiums can be fully paid for with Medisave, at least up to the age of 75.

Mr Khoo Kah Siang, president of the Life Insurance Association of Singapore, said the plan will appeal to people who want more coverage than MediShield Life, or who want to downsize from their existing private plans.

They should not look only at premiums when deciding on an IP, he said, as premiums are not guaranteed and insurers "may raise premiums differently over time".

Related: Q&A: MediShield Life and Integrated Shield Plans

This article was first published on March 16, 2016.
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