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SDP labels MediShield Life “too complicated”, opposes any premium hike

Party says concerns over health of citizens should trump concerns over whether fund is profitable

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Singapore — The opposition () has criticised the MediShield Life scheme and has opposed an impending premium hike recommended by a council convened to review the mandatory national health insurance scheme.

In a statement released on Wednesday (Oct 21), the party welcomed the call for public consultation on the proposed amendments to MediShield Life proposed by the MediShield Life Council and commended the council for recognising some of the most significant gaps, such as the high deductibles, in the current scheme.

The SDP also welcomed the inclusion of costs of treatment associated with substance abuse and suicide attempts but said that the rest of the changes “appear to be minor adjustments which may barely keep up with healthcare inflation in Singapore”.

Asserting that MediShield Life “only covers a small proportion of the total healthcare costs in Singapore”, the SDP pointed out how the scheme paid out close to S$1 billion out of a total healthcare expenditure of around S$18 billion in 2018.

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The party also highlighted how the scheme has caps on annual payments, daily payments and payments for various procedures such as radiotherapy or day surgery.

The SDP added that the scheme contributes to the “stigmatisation that those affected by mental illness face in Singapore” since psychiatric treatment is paid for at a much lower rate than other kinds of medical conditions, without any clear reason behind this practice.

The party pointed out that these caps are unusual when compared to other mandatory national health insurance plans, which usually cap the amount that an individual has to pay rather than the amount that the insurance covers.

It also noted that the caps do not take advantage of the fact that the Government is by far the largest provider of acute inpatient healthcare services which take up the bulk of costs.

The party further highlighted how many Singaporeans are concerned about how the improved benefits and reduced deductibles appear to be funded largely by increased premiums to be paid by the members of MediShield Life.

The authorities announced last month that MediShield Life premiums will rise by a third as part of a revamp to the scheme and reasoned that premiums need to go up in view of rising healthcare costs and to fund the enhancements to the scheme.

News of the premium hike drew swift backlash from Singaporeans, many of whom pointed out how the premiums collected between 2016 and 2019 were more than double what was paid out in claims. MediShield Life paid out S$3.5 billion for 2.3 million claims, while collecting S$7.6 billion in premiums, over the past four years.

Referring to the stark disparity between the premiums collected and the payouts, the SDP pointed out how MediShield Life already has one of the lowest medical loss ratios of any public mandatory health insurance scheme worldwide by far.

Expressing opposition to the premium hike, the party said that the argument that the premiums need to be increased to fund future commitments do not hold water if premiums will be raised every few years.

It said: “The argument used to justify the huge reserve requirement – “set aside to support future commitments, such as long-term treatments and future premium rebates” — does not make sense if the premiums are going to rise every few years. Long-term treatments would also have been factored into the actuarial calculations which have not been made public.

“While some degree of ‘front-loading’ may have been justifiable in the early years of MediShield Life when a number of individuals with pre-existing conditions previously excluded from MediShield are included for the first time. However, that number is unlikely to be repeated again.”

The SDP reiterated its view that the current healthcare structure, with the 3Ms of Medisave, MediShield and Medifund, is “too complicated” and positioned its plan to implement a single-payer national health insurance scheme as a superior, simpler and more sustainable healthcare approach.

The SDP proposes that the Government manage a national health investment fund with contributions by the public based on taxable income, which would provide basic health, accident and pregnancy coverage for all citizens.

Under the SDP’s policy proposal, there will be caps on the amount paid by the public and a return to the Singapore Medical Association’s fee guideline structure to cover more than just surgical procedures and institutions as well as providers. Evidence-based healthcare will be funded with small co-payments and the public and private sectors will be treated the same in terms of standards expected and reimbursement according to the fee guideline.

The party said concerns over the health of citizens should trump concerns over whether the insurance fund is profitable: “The basic overriding principle is that the health of the people is paramount, not the profitability of the fund.

“We hope that this can be considered instead of periodically tweaking the existing complicated healthcare financing model currently in operation in Singapore. With strict fee guidelines and reduced administrative costs, this plan will save Singaporeans money as it ensures we live happier and healthier lives.”

Paul Tambyah says SDP’s healthcare plan is superior to MediShield Life

Govt warns against delaying MediShield Life premium hike despite concerns

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