5 things you should know about the new MediShield Life

Since 1 November 2015, the Ministry of Health has introduced enhancements to the MediShield coverage for all Singaporeans and PRs. The new scheme is now named “MediShield Life”.

If you are not sure what the changes are and how they will impact you and your family, here are 5 things that you can expect from MediShield Life:

1.  Coverage for everyone

MediShield Life will cover all Singaporeans and Permanent Residents, including those with pre-existing conditions. Coverage is automatic and compulsory; there is no need to apply.

2.  Coverage for life

Lifetime coverage was previously only offered by private insurers via Medisave-approved Integrated Shield Plans (IPs).  Now, the MediShield Life component will also be extended to lifetime coverage. This is good news, since we typically require more healthcare as we get older.

3.  Increased claim limits

With rising healthcare costs, the claim limits for MediShield Life will also be increased, helping to reduce the amount you may need to pay by cash or Medisave. But while the claim limits have been increased, there are still limitations, which are listed on the MOH website here.

If you prefer to be covered for the full amount¹ that the hospital charges – known in insurance lingo as “as-charged coverage” – as well as enjoy coverage for pre- and post-hospitalisation treatments (which MediShield Life doesn’t cover), then you may consider purchasing an IP from an insurer, such as Aviva’s MyShield plan.

The new scheme has not changed everything. Under MediShield Life, your co-insurance and deductible will still exist and you will still be allowed to integrate it with IPs. Click on next to find out what does this mean.

4.  Your co-insurance and deductible will still exist

Deductible – or excess – is the initial amount you need to pay before the medical cost is covered by MediShield Life. It helps to sieve out small claims, which can be paid using Medisave and/or cash, and helps to keep premiums affordable. This will range from $1,500 to $3,000 depending on your age and ward type.

Co-insurance is the percentage of the bill you need to pay to co-share the bill with MediShield Life. This will range from 3% to 10%, depending on your bill size.

You’ll need to ensure you have enough liquid savings to take care of the deductible and co-insurance, in the event of a medical emergency. Alternatively, if you also have an IP, you’ll likely be able to purchase an add-on – also known as a rider – to cover the co-insurance and/or deductible portions of the bill as well, minimising your out-of-pocket expenses.

5.  Medishield Life will continue to be integrated with IPs

Since they are integrated, you only need to pay one premium to your insurer for both components – that is, both MediShield Life and the additional private insurance coverage provided by your insurer.

You’ll also only need to claim from one party – your insurer – to get reimbursed from both components. From a customer service perspective, this is useful as you’ll only need to liaise with one party; your insurer will then do the legwork to coordinate with CPF for the portions claimable under MediShield Life.

So what is the role of an IP?

An Integrated Shield Plan (IP) is a Medisave-approved plan made up of two parts: MediShield Life portion by CPF and additional benefits by the insurer. While MediShield Life will offer greater benefits than the current MediShield, it’s still designed to be a basic healthcare insurance scheme to ensure all Singaporeans can afford it.

If you prefer a more comprehensive coverage, then you’ll need an IP to cover that. The additional coverage that IPs offer can be broadly summarised as follows, depending on your insurer and plan type:

• “As charged” coverage for most benefits. This means you’ll not be restricted by MediShield Life’s claim limits and all eligible expenses can be claimed.
• Higher coverage so you have the option to receive treatment at higher wards or private hospitals, and still be covered for the higher costs.
• Higher annual claim limits.
• Coverage for pre-hospitalisation and post-hospitalisation treatments.
• Option to cover co-insurance and/or deductible with a rider.
• Other value-added benefits that your insurer may offer. For example, Aviva’s MyShield offers free coverage for up to four of your children until they turn 20, if both you and your spouse are policyholders, subject to policy terms and conditions.

Have you opted for an IP cover in addition to MediShield Life? Are you not sure about your options? Share your doubts and questions with us in the comments section below.

This post was brought to you by Aviva, one of the leading insurers in Singapore.

This article was first published on Aviva’s Money Banter blog – for more useful tips and guides on financial planning, subscribe to their free monthly-e newsletter!

¹ “As charged” refers to the eligible expenses which are subject to pro-ration, deductible, co-insurance, policy year limit, admission of ward class & other policy terms.