This article was originally published on 21 January 2019 and updated on 14 October 2020.
By now, we’ve all read about the elderly Singaporean man who had a hospital bill of $4,477, of which MediShield Life only paid $4.50.
While this case highlighted one case that the existing policy could do better to address, it is important to remember that the way the payout was calculated has always been in place.
It is timely then to take a quick refresher about how our national basic health insurance scheme, MediShield Life works.
What Is MediShield Life?
MediShield Life is a mandatory health insurance plan that provides basic protection to all Singaporeans and Permanent Residents against large hospital bills for life.
The definition is pretty packed with meaning, so here’s what each key word means.
mandatory: This means that MediShield Life is compulsory for all Singaporeans and Permanent Residents, with no option to opt out, and no requirement to apply.
health insurance plan: MediShield Life covers hospitalisation bill expenses, and not General Practitioner visits. Coverage is also provided on a as-charged basis, so you don’t get cash payouts for other expenses.
basic protection: MediShield Life is meant to give Singaporeans a basic safety net against large hospital bills, but it is by no means a substitute for private insurance and integrated shield plans. Claim limits are sized for subsidised treatment in government hospitals.
all Singaporeans and Permanent Residents: MediShield Life covers everyone, regardless of any pre-existing conditions.
for life: You are covered for life, and there is no expiry for MediShield Life coverage.
MediShield Life is enacted under the MediShield Life Scheme Act and administered by the Central Provident Fund (CPF) Board, with oversight from the MediShield Life Council and in close partnership with the Ministry of Health.
When Can You Make MediShield Life Claims?
You must stay in an approved medical institution for at least 8 hours or be admitted for day surgery to make a MediShield Life claim.
One common misconception is that if you are admitted in a private hospital, you cannot make MediShield Life claims. This is incorrect. Because MediShield Life payouts are pegged to bill sizes for treatment at public hospital B2 or C wards, if you choose to stay in a private hospital or a B1 and above ward in a public hospital, you will just need to pay a larger portion of the bill in MediSave, cash, or private insurance payouts.
How Much Can You Claim Under MediShield Life?
There is a three step process to calculate how much of your hospital bill can be claimed under MediShield Life.
Medishield Life Claim Limit: For each person, there is an annual claim limit of $100,000 per year, but no lifetime limit on claims. Thus, the maximum amount claimable is $100,000 minus the amount you already claimed under MediShield Life this year.
Deductible: Depending on your age, there is a deductible that you need to pay each year (in MediSave or cash), before MediShield Life kicks in. This means that if you were hospitalised once and paid the full deductible, you do not need to pay again if you are hospitalised later that year.
Source: Ministry of Health
Insurance Co-Payment: This is the percentage of the claimable amount that you have to pay, which ranges from 3% to 10%. In general, as the bill size gets larger, the co-insurance payable percentage is smaller. So, after paying the deductible (if applicable), the (C) is the portion of your bill that you still need to pay for.
Source: Are You Ready?
MediShield Life Benefit Payouts: Since MediShield Life benefits are sized to cover subsidised bills at Class B2/C wards, there are limits to how much MediShield Life will cover for each procedure. According to the Ministry of Health, these limits are reviewed regularly, and 9 in 10 patients will not exceed these limits.
Source: Ministry of Health
MediShield Life Exclusions
Aside from the above claim restrictions, there are certain line items and procedures not covered by MediShield Life, such as ambulance charges, maternity fees, and fertility-related procedures. You can refer to the Ministry of Health website for the full list of exclusions.
Paying MediShield Life Premiums
MediShield Life premiums can be fully paid using your MediSave monies. The government has committed to keeping premiums affordable, and there are various subsidies and schemes (like Pioneer Generation subsidies and MediSave top-ups) available to help those who face difficulties paying premiums. It has been emphasised that no one will lose MediShield Life coverage due to their inability to afford the premiums.
To find out more about your premiums payable and amount of eligible subsidies, you can use the MediShield Life premium calculator.
Those with pre-existing conditions will need to pay 30% more in Additional Premiums for the 10 years, after which they will pay the same premiums as everyone else in the cohort.
How To Make A MediShield Life Claim
Hospital staff are equipped and trained to help you file a claim with MediShield Life, so you just have to request for their help and authorise them to do so.
If you do not have a private integrated shield plan (IP): The hospital will submit the claim for you and the CPF Board will settle the portion of the bill you’re eligible for. You can then pay the rest using MediSave and/or cash.
If you have an IP: Inform your insurer (you don’t necessarily have to involve your financial adviser), and they will make the full bill amount covered by your IP plan on your behalf. You will then pay any balance using MediSave and/or cash. Behind the scenes, your insurer will reclaim the portion of the bill that is covered by MediShield Life.
Enhancing Your MediShield Life Coverage
As mentioned at the start, MediShield Life provides basic coverage and benefits.
Those who want more benefits on top of MediShield Life can purchase a private integrated shield plan (IP), which complements and enhances your MediShield Life policy. However, note that private insurers can (and most likely will) exclude covering claims due to pre-existing conditions. IPs allow for larger claims, with plans that cover treatments at B1 and A class wards in a public hospital or private hospitals.
For more details on choosing an IP, you can refer to our complete guide to buying a private integrated shield plan.
It is also worth noting that when you are unwell and require hospitalisation, your hospital bills are just one financial concern. You may incur a loss of income, require additional assistance and rehabilitation, as well as purchase medicines, supplements and equipment to assist in your recovery. Thus, you might want to consider if critical illness policies, disability insurance and other health insurance policies might be important to you.
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