Co-payment feature in insurance riders: Consider removing deductible for integrated plans
By TAN KIN LIAN, PRESIDENT, FINANCIAL SERVICES CONSUMER ASSOCIATION
The Ministry of Health has announced that new riders for all Integrated Shield Plans should have a co-payment of at least 5 per cent of the hospital bill, subject to a cap.
I wish to suggest a more holistic approach to this matter.
The Integrated Shield Plans comprise a MediShield Life portion managed by the Central Provident Fund (CPF), and another portion with extra coverage by private insurers.
The problem with the Standard Integrated Shield Plan is the high deductible, the fixed amount in cash the claimant has to pay before insurance payout kicks in.
There is no need to have a deductible to deter patients from staying in the hospital. They go for treatment out of necessity, rather than choice.
If the deductible is removed, there is no need for policyholders to buy a rider.
The co-payment of 10 per cent that is found in the Standard Integrated Shield Plan can remain, and a cap can be placed on that.
Over the longer term, we also need to address the problem of the escalating charges for treatment in hospitals and specialists.
I suggest that the Ministry of Health study the system used in Japan. Each year, their ministry negotiates with hospitals and doctors on the fixed fees to be charged for most kinds of medical procedures.
I understand that the providers have to follow strictly to these fees and are not allowed to make extra billings on the patients.
We can adopt the same approach for all treatments that are covered Medisave, Medishield Life and the integrated plans.
I believe that this approach will address the root of the problem and will also reduce the cost of administration of the financial payments for healthcare.
By TAN KIN LIAN, PRESIDENT, FINANCIAL SERVICES CONSUMER ASSOCIATION
The Ministry of Health has announced that new riders for all Integrated Shield Plans should have a co-payment of at least 5 per cent of the hospital bill, subject to a cap.
I wish to suggest a more holistic approach to this matter.
The Integrated Shield Plans comprise a MediShield Life portion managed by the Central Provident Fund (CPF), and another portion with extra coverage by private insurers.
The problem with the Standard Integrated Shield Plan is the high deductible, the fixed amount in cash the claimant has to pay before insurance payout kicks in.
There is no need to have a deductible to deter patients from staying in the hospital. They go for treatment out of necessity, rather than choice.
If the deductible is removed, there is no need for policyholders to buy a rider.
The co-payment of 10 per cent that is found in the Standard Integrated Shield Plan can remain, and a cap can be placed on that.
Over the longer term, we also need to address the problem of the escalating charges for treatment in hospitals and specialists.
I suggest that the Ministry of Health study the system used in Japan. Each year, their ministry negotiates with hospitals and doctors on the fixed fees to be charged for most kinds of medical procedures.
I understand that the providers have to follow strictly to these fees and are not allowed to make extra billings on the patients.
We can adopt the same approach for all treatments that are covered Medisave, Medishield Life and the integrated plans.
I believe that this approach will address the root of the problem and will also reduce the cost of administration of the financial payments for healthcare.
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