MediSave to pay for higher MediShield premiums as national health insurance coverage is expanded

PREMIUMS for Singaporeans’ basic health insurance plan look set to increase, as MediShield Life is made to work harder, provide more assurance against large medical bills, and pay for new ground-breaking treatments.

Recommendations by an expert panel on the review of the scheme are expected by the second half of 2024, said Health Minister Ong Ye Kung during the debate on his ministry’s budget on Wednesday (Mar 6).

MediShield Life is a basic, mandatory health insurance plan launched in November 2015 to protect all Singaporeans against large medical bills for life, regardless of pre-existing conditions.

It helps Singaporeans pay for large bills in B2 and C wards, which are subsidised wards, and is meant to cover nine in 10 subsidised bills.

But that is no longer the case today.

“This nine-in-10 benchmark is being eroded, because hospital bills are getting larger and larger,” said Ong.

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Bill sizes have grown by 5 per cent annually in public hospitals, and by 7 per cent annually in private hospitals over the last few years, he said.

As a result, the proportion of subsidised bills adequately covered by MediShield Life has come down to around eight out of 10, and is expected to slip further.

The practical impact of that is subsidised patients are seeing unexpectedly large hospital bills, he pointed out. After the subsidy and MediShield Life, there is still a substantial out-of-pocket component left.

This is when higher healthcare costs start to bite.

MOH has, therefore, tasked the 11-member MediShield Life Council to comprehensively review the scheme, said Ong.

The last time it was reviewed was in 2020, when premiums went up by 25 per cent on average.

MOH had said in 2019 that it will review claim limits for MediShield Life coverage every three years or so.

The MediShield Life Council is headed by Fang Ai Lian, the former chairwoman of Ernst & Young. It has already begun the review process and will look into three key areas.

First, the council will look into enhancing MediShield Life to give Singaporeans greater assurance against large bills. This means increasing the claim limits – how much a patient can claim from MediShield Life – for both surgical operations and hospital stays.

“We envisage a fairly significant increase in the claim limits. For example, for an episode involving angioplasty, where a stent is placed into your heart to open a blocked artery, plus, say, a few nights of ICU stay, the claim limits may need to double. This will reduce out-of-pocket costs significantly,” said Ong.

Second, the council will look at enhancing other outpatient coverage.

Ong said that there is a need to raise the claim limits for treatments such as kidney dialysis to reduce out-of-pocket expenses for patients.

The council will also explore extending coverage to more types of outpatient care.

He pointed out that some of the most costly outpatient treatments are for cancer.

MOH is facing an especially difficult challenge with cancer, he noted, with accelerating treatment costs.

The ministry had earlier reviewed cancer drug financing and introduced changes that allowed the Government to negotiate lower prices.

As a result, he said, prices for approved cancer drugs have since dropped significantly, some by up to 60 per cent. The impact is still playing out, and MOH will continue to monitor the situation.

Lastly, the council will also consider expanding MediShield Life coverage to new ground-breaking treatments, specifically cell, tissue and gene therapy products, also known as CTGTPs.

According to the World Health Organisation (WHO), CTGTPs include medicinal products like haematopoietic stem cells, skin grafts, novel gene editing technologies and engineered tissues.

WHO said that their use in the treatment of human diseases and physical conditions has captured wide interest due to their potential to address many unmet medical needs.

Ong pointed out that with medical science advancing rapidly, CTGTPs have the potential to revolutionise healthcare and deliver effective treatment of previously incurable diseases. Some describe it as the equivalent of a moonshot in healthcare, he said.

He explained that, essentially, the one-time treatment involves extracting the patient’s blood, teaching and equipping the cells in the blood to target and kill cancer cells, for instance, and then putting the cells back into the patient’s body to do their work.

“However, while the technology is promising and advancing fast, it is nascent and very expensive. It could cost anything from a few hundred thousand dollars to a few million dollars per treatment,” said Ong.

“We want to start including CTGTPs under MediShield Life coverage. But we need to put in place safeguards to ensure that financing of CTGTPs is sustainable.

“For instance, we will need to extend MediShield Life coverage only to treatments that are assessed to be safe, clinically effective and cost-effective,” said Ong.

In other words, if a treatment costs a few million dollars, with a small chance of curing a small group of people, it is not cost-effective, said Ong.

He added: “This is a significant step to help all Singaporean patients, regardless of their income levels, have access to cost-effective, novel, state-of-the-art therapies.”

While the proposed changes will better protect subsidised patients against major health episodes, MediShield Life premiums will inevitably go up, he said.

“But rest assured that we will do the necessary to ensure that as far as possible, premiums can be paid fully by MediSave,” said Ong.

For example, the Government will consider enhancing premium subsidies or MediSave top-ups for specific groups.

Singaporeans may have to use more of their medical savings in MediSave for small hospital bills so that MediShield Life can better focus on big hospital bills, which will then moderate premium increases, said Ong.

“No one will lose MediShield Life coverage due to a genuine inability to afford the premiums,” Ong stressed.

MOH will share more details when the council completes its review in the second half of 2024. THE STRAITS TIMES