UPDATE: This story has been updated following Senior Minister of State Lam Pin Min’s clarification on Friday (9 March).
Under revised Ministry of Health guidelines that take effect on Thursday (8 March), those who buy new Integrated Shield plan (IP) riders will be made to pay part of their medical bills, said Health Minister Gan Kim Yong in Parliament on Wednesday.
The revision requires that insurers’ new IP riders incorporate a co-payment of at least 5 per cent but places a cap on the payable amount for treatments that are pre-authorised or provided by doctors on insurers’ approved panels.
Gan noted that some private insurance policies offer zero co-payment coverage called full riders, which encourage what he called a “buffet syndrome” as patients do not need to pay anything when they receive medical treatment.
“It undermines the co-payment principle and dilutes the personal responsibility to choose appropriate and necessary care. This will encourage unnecessary treatment, leading to rising healthcare costs, not only for those with such riders, but for all of us,” said Gan
Senior Minister of State for Health Chee Hong Tat added that the buffet syndrome led to “over-consumption, over-servicing and over-charging of healthcare services”. He noted that in 2016, the average medical bill size for full rider policy holders was about 60 per cent higher than the average bill size for those without riders, even though rider policy holders are generally younger and in better health.
“If insurers intend to make changes to their existing rider policies, they should consider the interest and well-being of all policyholders, as they seek to keep premiums affordable for everyone in the long term,” said Chee, who stressed that the requirements were not introduced to “bail out” the insurers.
According to a Ministry of Health press release, most insurers are planning to launch their new riders with an annual co-payment cap of $3,000. While the new riders will be available from 1 April next year, insurers can continue selling their existing rider plans but will be required to inform their policyholders that they will transit to the new scheme from 1 April 2021.
These policyholders can choose to switch to the new riders earlier if they wish to do so. They can also continue to tap into their Medisave to pay their co-payment amounts, up to the applicable limits.
The MOH noted that about 68 per cent of Singapore residents are covered by IPs and about 29 per cent have riders that, when used with their IPs, provide full coverage that requires no co-payment – what is referred to as “full riders”.
The Health Insurance Task Force found that IP policyholders with riders had higher medical bills than those without riders in their 2016 review.
The MOH argued that the findings corroborate its analysis of insurers’ data in 2016, which found that the lack of a co-payment contributes to patient behaviour that results in “higher bills and claims”, despite full-rider policyholders being “generally younger”.
“The zero co-payment feature of full-riders pushes up overall healthcare costs in Singapore. Over-consumption, over-servicing and over-charging of healthcare services will lead to faster and larger increases in medical costs,” said the ministry.
MOH added that, based on the new guidelines, an estimated one in two in-patient bills across all ward types would have a co-payment amount of $100 or less, while nine in 10 would have a co-payment of $550 or less.
The guidelines will not affect MediShield Life or IPs that already have co-payment features.
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