Higher claim limits, better coverage and higher premiums for MediShield Life from April 2025

SINGAPORE — Singaporeans will be able to claim more for hospital stays, and get coverage for additional outpatient treatments as well as certain new groundbreaking therapies from their MediShield Life policies, when changes kick in progressively from April 2025.

Inpatient daily claim limits for the first two days of a normal ward stay will rise to $1,630, from $1,000, for instance, while that of intensive care unit (ICU) stays will more than double to $5,140.

The policy year claim limit will also be pushed up to $200,000, from $150,000, said the Ministry of Health (MOH), in accepting recommendations from the council tasked with ensuring that MediShield Life is effective.

Premiums for the mandatory national insurance scheme will rise as a result, especially for older Singaporeans, although over nine in 10 people will get help to more than offset these increases.

Health Minister Ong Ye Kung said the changes and support measures will strengthen the MediShield Life and MediSave systems, which, when combined, have worked well for Singapore.

There are countries that focus a lot on healthcare subsidies, which are funded by taxation, but that causes excess demand. Waiting time becomes very long in the hospitals and clinics, and while the care is very affordable, it is not very accessible, he explained.

"There are also other countries that then focus a lot on insurance, and excess demand becomes much less of a problem. Instead, affordability becomes an issue for those who are not insured."

"It is very important that these two safety nets work hand in hand," he told the media in an interview at MOH headquarters.

The first review of Medishield Life in four years has recommended that premiums be increased amid rising healthcare costs, and outpatient coverage be enhanced significantly given that healthcare delivery is increasingly shifting from hospitals to the outpatient, community and home settings.

The MediShield Life Council, an 11-member panel headed by Fang Ai Lian, the former chairwoman of Ernst & Young, has recommended that premium increases over the next three years be capped at 35 per cent, with an average increase of 22 per cent.

But most will not pay out of pocket for the next three years.

More than nine in 10 Singaporeans will benefit from $3.4 billion in MediSave top-ups and $700 million in premium subsidies that will more than offset the premium increases over the next three years, said MOH on Oct 15.

MediShield Life was launched in 2015 and the previous review was in 2020.

The changes, which will take place progressively from April 2025, will ensure that it can go back to fully covering nine in 10 subsidised bills in public healthcare institutions, as it was intended to do. Currently, the scheme fully covers just under eight in 10 subsidised bills, as rising costs have eroded coverage.

To rein in healthcare spending, deductibles and co-payments are a mandatory feature of MediShield Life and Integrated Shield Plans (IPs), which provide coverage on top of the basic plan for treatment as a private patient.

With payouts expanding to cover larger bills and to moderate the extent to which premiums will rise, deductibles will climb by up to $1,500, from a range of $1,500 to $3,000, depending on age and ward class, for inpatient stays.

A new outpatient deductible of $500 per year will also be introduced, but the Government will adjust MediSave withdrawal limits to help patients with the increases. The deductible is the amount a policyholder must pay before an insurance claim can be made.

Co-payments for outpatient treatments will drop from a flat 10 per cent to a tiered structure ranging from three per cent to 10 per cent to improve affordability for larger outpatient bills.

Overly generous health insurance policies drive healthcare costs to rise, as they can encourage unrestrained spending on tests and treatments, leading to bigger bills.

Ironically, about half of patients with IPs still end up using subsidised care in a public institution, Ong has said, thus paying for coverage they do not even use.

Ong said: "In particular, we are most concerned about unexpected health episodes that require you to stay in hospital for a long time, maybe even the ICU."

The increases in claim limits will offer Singaporeans greater assurance for subsidised healthcare, he pointed out.

"Actually, there might be an impact where people shift towards subsidised healthcare and see that 'maybe I don't need an IP', right? We have to wait and see."

Outpatient claims and new treatments

Meanwhile, existing outpatient claim limits will be revised upwards and new outpatient treatments and home-based medical care will be added to the coverage.

These include, for the first time, wound therapy, a non-invasive form of brain stimulation to treat those with treatment-resistant depression, known as repetitive transcranial magnetic stimulation or rTMS, and a service that offers mechanical-assisted ventilation to those with breathing insufficiency in the comfort of their own home.

Currently, only selected costly outpatient treatments such as kidney dialysis, radiotherapy for cancer and immunosuppressants for organ transplant are covered. 

Claim limits for kidney dialysis will be raised from $1,100 to $1,750 a month.

"One area we are quite concerned about is (that) kidney dialysis cost has been going up. If nothing is done, it's a matter of time before kidney dialysis patients have to come out of their own pocket and pay cash for dialysis," said Ong.

The National Kidney Foundation said that with the changes, about 62 per cent of its dialysis patients will see a reduction in their co-payment amount. The remaining 38 per cent are already fully subsidised.

From October 2025, MediShield Life's coverage will extend to high-cost treatments that are clinically effective and cost-effective, such as those on MOH's list of cell, tissue and gene therapy products. Currently, only Kymriah, a treatment for certain types of leukaemia and lymphoma, is on the list.

Experts who were interviewed said rising healthcare costs and a rapidly ageing population mean that further adjustments in the future can be expected.

Associate Professor Jeremy Lim from the NUS Saw Swee Hock School of Public Health told The Straits Times: "Singapore is ageing as a society, we reasonably want to benefit from the advances in medical technology, and Singapore is an expensive place to live.

"These three fundamentals won't change and so we have to plan for a future in which premium increases are a regular feature of these reviews."

He said the recommended premium increases are painful but necessary.

"Financially, we need to set aside more monies as individuals for future health needs, especially if we want to continue with the IPs. And, societally, we all need to play our part in keeping healthcare cost increases more manageable by staying as healthy as we can, and not unnecessarily using the healthcare system when we're ill."

Associate Professor (Practice) Joey Zhou from Nanyang Technological University, who is a fully qualified actuary, said strategies such as preventive healthcare measures, promoting healthy lifestyles and implementing cost-effective medical practices will be crucial in ensuring long-term affordability.

"For older individuals, who are more likely to require medical care, the improved benefits offer greater financial protection and peace of mind," he said.

"However, the increased premiums emphasise the need for sustainable solutions to manage healthcare costs without placing undue financial strain on seniors and vulnerable populations."

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This article was first published in The Straits Times. Permission required for reproduction.