Insurance should cover everyone: Ambassador Tommy Koh

Insurance should cover every person who seeks coverage, whether or not they suffer from pre-existing medical conditions, chronic diseases or congenital health conditions, said Singapore’s ambassador-at-large Tommy Koh.

Speaking on Thursday at an Institute of Policy Studies (IPS) roundtable on Singapore’s population trends, Koh, who is also special adviser to the IPS, said the government should step in to ensure that insurance coverage is fair and accessible for all.

He identified insurance as one area where Singapore “didn’t get it right”, touching also on the nation-state’s failure to achieve inclusive growth — more specifically in terms of plugging the income gap.

“We need to fix the equity of our existing healthcare system. We have a system at the moment that does not meet my standard of fairness,” he said.

“I think the state should intervene and require all insurance companies to insure people with prior medical conditions. There should be no one in Singapore who is not insured against a potential catastrophic disease,” he added, noting that, currently, insurance companies will not cover applicants who have pre-existing medical conditions.

Industry experts and veterans agreed with Koh’s sentiment, with some pointing out that the effects of not being insured go beyond simply affording medical treatment.

Chief executive officer of Fortis Healthcare Dr Jeremy Lim, who was present at Thursday’s roundtable, told Yahoo! Singapore that patients who suffer from chronic conditions like cancer and kidney failure face challenges in finding good jobs, over and above seeking coverage for treatment.

“Hence it is a double whammy — uninsurable with ongoing medical expenses, and tremendously reduced earning power,” he said.

Noting that one possible way to solve this problem is by establishing a national health insurance scheme, he said the decision would be more a moral one than an economic one, as the move to do so would promote social cohesion.

In a commentary published in The Straits Times Thursday last week, Lim said insurers should work to improve the health of the insured population so that they consume fewer healthcare services, instead of charging higher premiums, lowering payouts and excluding high-risk individuals.

“Learning from the experiences of other systems, we can offer national health insurance (either government-provided or government-mandated) and start coverage conservatively with ramping up as we gain more experience with truly national schemes,” he suggested as a start, referencing the English National Health Service, which began with greater ambition than it was able to afford.

Former NTUC Income chief executive Tan Kin Lian also weighed in on the issue, noting that MediShield, the government’s existing general coverage plan for most Singaporeans, currently excludes pre-existing illness and congenital conditions, as well as applicants who suffer from chronic diseases.

He said alternative measures include the exclusion of coverage of pre-existing conditions for a waiting period of between one and two years, and provide full coverage thereafter, or simply the charging of a higher premium for applicants with pre-existing conditions.

Tan recommended, however, that MediShield be reviewed to provide coverage for applicants with these illnesses so that under its “integrated scheme” with private insurance providers, the latter will automatically provide the same coverage as well.

“While the insurance scheme should be run on a viable basis, and appropriate risk management methods should be applied, the purpose should not be to maximise profits for the insurance company,” said Tan. “It should have its social purpose of providing cover to those who need it at an economic cost.”

Income gap is “socially unconscionable”

Turning to the wage gap, Koh spoke of economist Lim Chong Yah’s wage shock therapy as one of three existing ways to plug it, and that while he did not agree with Lim’s proposal, he agreed with the latter’s aim.

He said that the issue needed to be addressed “not through palliatives but by seeing what we can do to fundamentally alter the wages of the bottom 30 per cent of our people”.

Koh also opposed the view of economist Shandre Thangavelu, who was also at Thursday’s roundtable, that the income gap is “part of globalisation and technological change”.

The ambassador contended that Singapore’s practice of importing large numbers of cheap and unskilled labour depresses wages in its service and non-tradable sectors. He further noted that construction workers in Hong Kong are twice as productive as those in Singapore, and receive two-and-a-half times the income earned here.

His view echoed those expressed by IPS senior adjunct fellow Yeoh Lam Kheong and Lee Kuan Yew School of Public Policy dean Kishore Mahbubani earlier on Thursday, who both called for a refinement of the import of new citizens and PRs to target more skilled labour.

“There are many equity issues we need to look at in Singapore, although I agree that we have done many things right. We just need to improve on a tremendously successful story,” Koh concluded.

Should the existing MediShield and Medifund schemes be reviewed to accommodate the needs of chronically-ill and people with pre-existing medical conditions?

What might the government's concerns be in doing such a review?