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MediShield Life: Govt accepts proposals, will provide almost S$4b in subsidies

"No needy Singaporean will lose MediShield Life coverage due to financial need": Ministry of Health.

SINGAPORE: The Government on Friday (June 27) accepted all of the MediShield Life Review Committee's recommendations, and will provide almost S$4 billion in subsidies and financial support over the next five years.

The insurance scheme will be implemented at the end of 2015, with more details on the implementation of the scheme will come at a later date. The committee's report will be tabled as a White Paper for debate in Parliament in July, the Ministry of Health (MOH) said in a press statement on Friday.

READ: MediShield Life Review Committee unveils recommendations

"The introduction of MediShield Life in 2015 will be a major step in our efforts to build a strong and sustainable social safety net. It will provide every Singaporean with lifetime basic protection against medical costs for greater peace of mind," the ministry said in the statement.

"The Government agrees with the committee's approach in calibrating a careful balance between providing more benefits and keeping premiums affordable, while ensuring the system is sustainable over the long term.

"MediShield Life will provide better protection, for all and for life. With better benefits, premiums will need to increase, but will be able to be fully paid for by Medisave," added the ministry, which said it would ensure that Medisave Withdrawal Limits will be able to cover all premiums. A 1-percentage-point increase in Employer's Medisave contribution from 20-15 will cover the increase in premiums for most households, it said.

BREAKDOWN OF SUBSIDIES

One of the key tenets of the insurance scheme is to help cover those with pre-existing conditions, with the Government bearing the bulk of the cost - three-quarters of the bill, to the tune of about S$850 million over five years, said the MOH.

A further S$430 million a year will go to subsidies for the Pioneer Generation, lower-to-middle-class Singaporeans, and the needy who need Additional Premium Support on a case-by-case basis.

"No needy Singaporean will lose MediShield Life coverage due to financial need," the ministry said in its statement.

Those in the Pioneer Generation will receive subsidies of between 40 and 60 per cent of their premiums, as well as annual Medisave top-ups of about S$800 which can be used to pay for the premiums, the MOH said, noting that all Pioneers will pay less for MediShield Life premiums than they do today. Those aged 80 and above in 2014 will have premiums fully covered.


Citizens in the lower-to-middle income bracket - which includes up to two-thirds of all Singapore households - will be eligible to subsidies of up to 50 per cent, with those who are older, with lower income, and living in properties with lower annual value getting more. Permanent Residents will receive half the subsidy rates compared to Singapore Citizens of the same age and income and property types, the MOH said.


All Singapore Citizens will get Transitional Subsidies for the first four years to help with the premium increases, a move which will cost the Government about S$830 million over the four years. In the first year of MediShield Life, starting end-2015, citizens will receive a subsidy of 80 per cent of the premium, followed by subsidies of 60, 40 and 20 per cent in each subsequent year.

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