What the new Integrated Shield riders imply

LAST week, the Ministry of Health announced major changes to the Integrated Shield Plan (IP) riders to address their unsustainable increase in premiums and to enhance affordability. These changes will take effect on Apr 1, 2026, and represent a significant shift in the design and coverage of IP riders for hospital insurance.

The latest changes are a step forward in helping to shift the unhealthy behaviours of medical consumption and to bring about greater stability in hospitalisation insurance.

We are monitoring the evolving IP landscape and may provide further updates in due time as insurers announce their product offerings. This column is our take on the implications of the upcoming changes.

Existing IP rider structure (before the changes)

The typical benefits of IP riders include:

• Deductible waiver: This covers up to S$3,500 for public hospitals (A ward) or private hospitals, allowing claims from the first dollar.
• Reduced co-payment: Lowering co-payment from 10 per cent to 5 per cent of the bill, after the deductible.
• Co-payment cap: Capping co-payment at S$3,000, limiting out-of-pocket expenses.

While providing peace of mind in covering most of the hospital bill, these features inadvertently contributed to the rapid premium escalation due to frequent and excessive claims.

Key changes (effective Apr 1, 2026)

• No deductible coverage: New IP riders can no longer cover the minimum IP deductible.
• Higher co-payment cap: Annual co-payment cap increases from S$3,000 to S$6,000.
• Expected premium reduction: Premiums for new riders are expected to drop by around 30 per cent on average, with more savings for older policyholders.
• Transition period: Existing riders may still be purchased until Mar 31, 2026. However, riders bought between Nov 27, 2025, and Mar 31, 2026, will be required to switch to new riders no later than their next renewal after Apr 1, 2028.
• Grandfathering: IP riders bought before Nov 27 may continue with their existing coverage, but this is subject to the insurer’s decision to continue to offer them.

Implications of new IP rider design

1. Higher out-of-pocket expenses

With the new IP rider, you must now bear more out-of-pocket expenses since the deductible can no longer be covered, and the co-payment limit is raised to S$6,000. This out-of-pocket expense can be partially offset by MediSave based on its applicable withdrawal limits.

2. Smaller bill sizes not covered

Bills below the deductible amount – that is, minor procedures such as gastroscopy, endoscopy or sleep test – will not be claimable under the new rider, increasing out-of-pocket spending for smaller treatments.

SEE ALSO

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IP rider changes: Yet another stab at dampening claims and improving insurers’ results

Here are some examples to illustrate the impact of the new rider for different bill sizes. These assume that the existing rider provides a deductible waiver and requires 5 per cent co-payment.

3. Lower premiums

New IP riders are expected to be about 30 per cent cheaper, translating to around S$600 in annual savings for private hospital riders and around S$200 for public hospital riders, with older policyholders enjoying higher savings.

Our advice on IPs

1. Consider your healthcare expectations

Our guide to purchasing an IP has always been based on one’s healthcare expectations. If you are satisfied with staying in a subsidised public hospital (B2/C wards), there is no need to buy an IP as your MediShield Life would be sufficient.

However, if you want the option of higher ward type or even in private hospitals, then you will need to consider an IP. Affordability of IP is also an important financial consideration, not just on the current premium level but also ongoing premiums.

Another benefit of an IP plan is that it offers additional benefits in covering pre and post-hospitalisation expenses, hence lowering your out-of-pocket expenses.

2. Consider your need for a rider

If you want to make sure that the deductible is paid by insurance and/or that you only have to pay a limited co-payment, then you should buy an IP rider.

Another benefit of buying an IP rider is that it offers additional cancer-drug benefits, including treatments outside the Cancer Drug List. Without a rider, you may have to pay more for cancer drugs and have no access to drugs outside the list.

The current rider also caps a person’s co-payment to just S$3,000. However, this kind of rider is very expensive as premiums have been escalating over the years. If you want a more affordable option, you may opt to switch to the new rider.

Under the new rider, the deductible will have to be paid by the policyholder and the co-payment cap is now higher at S$6,000. This means that the new rider will not cover smaller bill sizes. However, you may save an average of 30 per cent in premiums.

3. Further considerations

Current policyholders should review whether retaining their existing rider is preferable, balancing premium savings against more comprehensive coverage.

There is no action needed for those holding to their existing rider (bought before Nov 27), as insurers have yet to announce their new rider. The new riders must be available by Mar 31, 2026.

For new IP rider purchasers (on and after Nov 27), there is no rush to buy an existing IP rider before Apr 1, 2026, as any rider bought must be transitioned to the new IP requirement eventually.

The writer is chief executive officer, Havend.