Implications of Claims-based Health Insurance Pricing on Older Policyholders and Those who Choose to Move to Public Healthcare System
Ministry of HealthSpeakers
Summary
This question concerns the impact of claims-based health insurance pricing on older policyholders and the potential shift of Integrated Shield Plan holders to public healthcare. Minister for Health Ong Ye Kung explained that private riders require a minimum 5% co-payment to mitigate "buffet syndrome" and unsustainable cost increases, though claims-based pricing is not applied to MediShield Life or Integrated Shield Plan premiums. He emphasized that all Singaporeans receive lifelong protection under MediShield Life regardless of pre-existing conditions, and policyholders should evaluate if optional cash-paid riders suit their specific needs. Minister for Health Ong Ye Kung further clarified that MediSave can be used for basic insurance premiums which remain unaffected by claims-based pricing structures. There is currently no evidence suggesting that claims-based pricing has resulted in a shift of insurance claims toward the public healthcare system.
Transcript
71 Ms Mariam Jaafar asked the Minister for Health with regard to the introduction of claims-based health insurance pricing, what avenues exist to protect the interests of older policyholders and policyholders with pre-existing conditions.
72 Ms Mariam Jaafar asked the Minister for Health with regard to the introduction of claims-based insurance pricing, what is the number of Integrated Shield Plan holders who have switched to MediShield Life and moved into the public healthcare system.
Mr Ong Ye Kung: Riders are optional private insurance products that are paid for by policyholders in cash, to provide as-charged and zero co-payment coverage. Since 2019, MOH has required a minimum 5% co-payment for all new rider products to mitigate the risk of a "buffet syndrome" and avoid unsustainable healthcare cost and insurance premium increases. Some insurers have chosen to implement the co-payment directly, through claims-based pricing (CBP), or a combination of the two.
Regardless of the healthcare insurance plans they choose, all Singapore Citizens and Permanent Residents are covered under MediShield Life, which is a basic health insurance plan that provides lifelong protection against large hospital bills regardless of pre-existing conditions. This protects the interests of all policyholders, including older Singaporeans who have pre-existing conditions. This can be supplemented with optional Integrated Shield Plans (IPs) if higher coverage is preferred. MediSave can be used for MediShield Life and IP premiums, and these are not subject to CBP.
Policyholders should carefully assess the terms of their private rider policy plans and consider discussing with their insurer a plan that is suitable for their needs.
There is currently no evidence to show that CBP shifts claims to public hospitals.