Getting protection for your health
Your health is your best asset, especially if you are the breadwinner of your family. Besides looking after your health, it is crucial to include health insurance as part of sound financial planning.
Let’s start with the basics. MediShield Life is a national health insurance plan that provides lifelong protection for all Singapore citizens and Permanent Residents. It is administered by the Central Provident Fund (CPF) Board, which helps to pay for large hospital bills and selected costly outpatient treatments, such as dialysis and chemotherapy for cancer.
The coverage is meant for subsidised treatment in public hospitals. Those who choose to stay in a Class A/B1 ward or in a private hospital are also covered by MediShield Life. But as MediShield Life payouts are pegged at Class B2/C wards, the MediShield Life payout will make up a small proportion of the bill only. Thus, the patient may need to top up the payment with Medisave and/or cash.
What’s attractive about this scheme is that it covers you for life, no matter your age or pre-existing conditions.
Integrated Shield Plan
To cover charges for staying in Class A/B1 wards in public hospitals or private hospitals, you may wish to consider purchasing additional private insurance coverage, which complements MediShield Life as an Integrated Shield Plan, such as MyShield, which can be purchased using Medisave funds.
Even so, there is still an initial amount called a “deductible” that you are required to pay for, on top of the co-insurance (usually expressed as a percentage). To ensure you are covered for out-of-pocket expenses, there are additional riders for consideration, such as MyHealthPlus.
Full riders were once available, and insured patients did not have to pay a single cent on their medical bills. But under new Ministry of Health guidelines, they will no longer be offered. From 1 April 2019, you will only be able to buy co-pay riders that require you to pay at least 5% of your bill while the insurer pays the rest.
Compare plans before you buy
If it’s an Integrated Shield Plan that you want, it is important to do your research and compare the arrangements offered by different companies. Here are some things to look out for:
- Deductible and co-insurance amounts – whether the policy requires you to pay out-of-pocket or from your Medisave
- Claim limits – the cap for the amount that you can claim
- Age limits – the age at which the policy’s coverage stops
- Policy exclusions – besides pre-existing conditions, whether it covers outpatient or alternative treatments such as Traditional Chinese Medicine
- Waiting period – the period after buying a policy during which benefits will not be paid even if an event occurs
What else to take note of
Be aware of the impact your medical history has on your coverage. Is there a history of cancer in your family? How about diabetes, high cholesterol and stroke? Understanding your medical history and current lifestyle can help you gauge how comprehensive your health insurance coverage should be.
Evaluate affordability in the long-term. It may be tempting to insure yourself for everything imaginable. But that raises the cost of your insurance. And remember, insurance premiums tend to increase with age. Besides looking at the price you need to pay today, also consider the increase that will take place over time and your other financial commitments that may grow as you move into other seasons of life, such as getting married and having children. Over-insuring can be a problem because you may end up paying more than you claim in your lifetime.
Remember, you have a “free look” period. This is a grace period – usually 14 days from insurance firms and 21 days for Integrated Shield Plans – when you can review your policy carefully to see if it is what you want. This period starts when you receive your policy documents. Even if you have committed to a policy, during this “free-look” period, if you decide that the policy is not for you after all, you can write to the insurance company to give them a notice of cancellation. The company will refund all your premiums, less medical and other expenses that have already been incurred.