MediShield premiums will be kept affordable for the elderly

26 March 2013

Rising MediShield premiums depleting seniors’ Medisave accounts

My mother has been a homemaker all her life. Seniors like her do not have much savings and, perhaps, could have been better off without putting money in their Medisave account.

She has been topping up her Medisave for over two decades but has been paying only in cash for her healthcare expenses. Her Medisave has now been depleted by her MediShield premiums, which have increased over the years, but she has not made any claim.

In 2000, the Government encouraged the elderly to apply for MediShield by paying the premium for two years. My mother was 69 then and her premium was S$132, which we thought was a reasonable starting amount. But by 2006, her MediShield premium was S$375. It was S$615 last year and S$1,123 this year, an 82.6 per cent increase, with not enough in her Medisave to pay for it after 12 years. She will not receive the Government’s Medisave top-up of S$400 until her MediShield is renewed.

What we did not know, until the Central Provident Fund Board sent a letter, was that the S$400 to offset the premium hike is for two years, or S$200 a year, effectively. What is S$200 when her premium has shot up by S$508?

If the elderly are unable to keep topping up their Medisave, they would have no MediShield coverage in their critical years, and the current web of policies is too complicated for them to understand.

Georgia Tong Jee Cheng

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1 April 2013

MediShield premiums will be kept affordable for the elderly

We are glad that Madam Georgia Tong had encouraged her mother to join MediShield to ensure protection against large healthcare bills as she ages (“Rising MediShield premiums depleting seniors’ Medisave accounts”; March 26).

We note Mdm Tong’s concern that our elderly, especially those who are homemakers or unemployed, may have insufficient Medisave for their old-age MediShield premiums.

MediShield premiums rise with age as they are based on the risks faced by each age group, and the elderly are more likely to require healthcare.

The scheme is designed such that the young do not cross-subsidise the elderly, so that it remains sustainable in the long run.

Hence, the MediShield premiums for Mdm Tong’s mother will increase over time, such as when she crosses from the 79-80 age band to the next age band (81-83).

MediShield premiums will also need to be adjusted from time to time, to support enhancements to the scheme which provide policyholders with greater coverage, and in line with claims experience.

In the recent adjustment, the rise in MediShield premiums was minimal for those aged above 80, at 3 per cent. The increase experienced by Mdm Tong’s mother was mainly because she had crossed into a new age band.

We are mindful that the increase in MediShield premiums, as one ages and as a result of adjustments, could pose a burden on our elderly and their families.

To help alleviate this, the Government provides regular Medisave top-ups of up to S$450 for the elderly under the permanent Goods and Services Tax Voucher scheme and additional Medisave top-ups from time to time, in line with budget surplus.

In Budget 2013, the Government provided an additional top-up of up to S$650 for Singaporeans aged 45 and above to help them with their healthcare expenses.

As part of the ongoing review of the healthcare financing framework, the Ministry of Health will continue to look at how we can better help elderly Singaporeans with their healthcare expenses, including MediShield premiums.

Bey Mui Leng (Ms)

Director, Corporate Communications Ministry of Health