Health Insurance in Singapore: All You Need To Know

This was originally posted on Planner Bee.

One non-negotiable insurance that everyone should have in Singapore is health insurance. In fact, it’s deemed so important that the government makes health insurance mandatory in the form of MediShield and MediShield Life.

MediShield and MediShield Life: What is it?

In 1990, the Singapore government introduced MediShield. It’s a low-cost basic medical insurance scheme meant to help individuals cover large Class B2/C hospitalisation bills that Medisave alone may not be sufficient for. When MediShield was introduced, members were automatically opted in, but were given the choice to opt out should they wish to.

In November 2015, MediShield Life was rolled out. It’s an enhanced version of MediShield and like its predecessor, is a basic health insurance plan that protects all Singapore citizens and Permanent Residents (PRs) against large hospital bills. It is similarly managed by the Central Provident Fund (CPF), and its premium is payable fully by Medisave.

The difference: MediShield Life is mandatory for all, and opting out is no longer allowed.

One plus point worth mentioning about MediShield Life is that it covers all the pre-existing conditions that a person might have. This is good news for citizens and PRs who have uninsurable conditions such as heart disease or diabetes.

Read more: MediShield Life Explained

Coverage for non-Singapore citizens, PRs and non-PRs

For employees in Singapore who are neither Singapore citizens nor PRs, their employers usually offer medical coverage, but more is often needed.

The Ministry of Manpower stipulates that employers must purchase medical insurance for each work permit holder, with at least S$15,000 coverage for policies before 1 July 2023, or S$60,000 of coverage per year, for those after 1 July 2023. However, this rule does not apply to Employment Pass (EP) holders, so most have to get their own private medical insurance.

Often, any additional medical benefits are implemented as perks to make jobs more attractive. Still, it should be noted that they are not mandated by law for employees doing non-manual work, and whose salaries are more than S$2,600.

In other words, employers are not required to offer adequate coverage for employees.

How expensive can hospitalisation fees get in Singapore?

For illustration purposes, this is an example of an interim bill from November 2021. The patient was hospitalised for five days in a single-bed ward of a private facility, after undergoing a laparotomy surgery for removal of ovarian cysts.

The cost of the procedure and the subsequent stay in the hospital was initially estimated at S$32,000. However, complications arose during the procedure and by the time she was discharged, the bill had ballooned to the S$57,653.61 seen here.

The Letter of Guarantee she required from the insurance company covered only the initial estimated bill, and the amount that is Medisave-claimable for her is S$7,200. As a result, she is required to foot the remaining S$18,453.61 of the bill out of pocket.

This is a good example that given the volatility of medical bills, and the fact that the onus of adequate health insurance often lies on the individual, having sufficient coverage is very important.

Getting better coverage than MediShield Life

MediShield Life has been made affordable for all citizens and PRs for them to have lifelong basic health coverage. Premiums are kept affordable, and various subsidy schemes are also made available.

However, just having MediShield Life is not enough for your health coverage in Singapore.

MediShield Life has claims limits, and is subject to deductibles and co-payment (both are amounts that must come out of pocket by the insured) so it will not be able to cover the hospital cost entirely.

Moreover, Singapore’s restructured hospitals have limited availability, so the time spent waiting for treatment will depend on the urgency of your condition, as well as the queue ahead of you.

Should you opt for Singapore’s public healthcare system, you would most likely be subjected to a longer waiting time than if you were to seek treatment from a private healthcare provider. However, doing so could mean treatment costs spiralling up to five times more. To access private healthcare options without being bogged down by the costs, one would do well to be covered with private health insurance such as an Integrated Shield Plan.

Integrated Shield Plans

With almost 3 million Singaporeans enrolled, Integrated Shield Plans (IPs) are popular private health plans that people get to ensure that they are well-protected even during unpredictable medical emergencies.

Many private insurers offer IPs as part of their catalogue of policies. Some of the more popular and well-known plans are:

• AIA HealthShield Gold Max
• Singlife Shield
• HSBC Life Shield
• Great Eastern GREAT Supremehealth
• Income Enhanced IncomeShield
• Prudential PRUShield
• Raffles Health Insurance Raffles Shield

Private IPs stack on top of the basic MediShield Life coverage, providing higher annual limits, along with pre- and post-hospitalisation coverage.

What type of coverage should I choose?

When it comes to health insurance, there are a few things to consider:

Affordability of premium over time

Premiums for health insurance for both MediShield Life and IPs are not guaranteed. Premiums will increase with age, along with the riders you opt to take up along with your plans. Check how much of the premium can be paid using Medisave and if you are comfortable with any out-of-pocket premiums you have to pay.

Choice of hospital and ward class

Consider the type of hospitalisation care you prefer. Many opt to purchase IPs that cover private hospitalisation as they have preferred doctors who might be practising at a private hospital. Others, meanwhile, simply prefer to have the ability to opt for private healthcare if the need arises.

Annual limits

All IPs have unlimited lifetime limits, but they do come with different annual limits. Here’s an overview of the various limits across insurers:

Deductible and co-insurance

All claims are subject to deductibles and co-insurance (a percentage of the bill you need to pay above the deductible). Some IPs provide coverage with a lower deductible if you visit their panel of doctors or obtain a pre-authorisation before treatment.

Insurers usually provide additional coverage options, a term often referred to as a rider. Adding a deductible or co-insurance waiver rider can help to reduce your out-of-pocket expenses as it pays for part or all of the deductible and co-insurance.

The table below shows an example of how much deductible and co-insurance a patient will have to pay without deductible or co-insurance waiver riders:

Read more: How the out-of-pocket can be reduced with the respective riders.

You can also add on the Hospital Cash rider, which pays you a small fixed sum for every day you are hospitalised, and use this payout to cover your deductible and co-insurance.

Options for foreigners

IPs were designed to supplement MediShield Life, so it is mainly offered to Singapore citizens and PRs. However, some insurers do offer integrated shield plans to non-citizens and non-PRs at higher premiums.

For this group of people, there may be a need to consider also being covered for medical costs in their home countries. If so, global health insurance might be a better choice, as it will provide coverage for the insured in Singapore, as well as their home country.

To illustrate:

John, 35, works in Singapore but is neither a Singapore citizen nor a Permanent Resident. His choice of hospital ward is a private one-bedder.

Integrated Shield Plan:

AIA HealthShield Gold Max with AIA Max VitalHealth rider

Cost: starts from S$1,966 per year

Global Health Insurance:

HSBC GlobalCare (covers worldwide, excluding the USA)

Premium: S$3,161 per year

For John, it will cost approximately S$1,200 more for global health insurance annually, but it will provide him with the option of returning to his home country to seek healthcare. That could mean getting treated in a place where there is less of a language or culture barrier, through a healthcare system that he is familiar with, while being closer to loved ones.

Are outpatient fees covered?

IPs are mainly meant to cover in-patient costs, but some outpatient fees are covered too. This includes:

• Outpatient chemotherapy
• Outpatient kidney dialysis
• Immunosuppressants for organ transplant
• Day surgeries

From April 2023, IPs will only cover MOH-approved outpatient cancer treatment. Treatments such as trial drugs and alternative medicines will also not be claimable.

In conclusion

Selecting the right health insurance in Singapore is a critical decision that requires careful consideration of various factors, including the type of plan, coverage details, and cost.

Singaporeans should thoroughly assess their personal health needs, financial capacity, and future healthcare expectations to make an informed choice. By understanding the nuances of different health insurance options and leveraging government schemes like MediShield Life, individuals can ensure comprehensive protection and peace of mind.

Consulting with insurance experts and staying informed about the latest developments in healthcare policies will further empower you to secure the most appropriate and beneficial health coverage for yourself and your families. Want to know more about how you can supplement your insurance coverage? Drop us an email at [email protected] today!