Thursday 17 March 2016

Standard Integrated Shield Plan for Class B1 wards from 1 May 2016

New no-frills insurance plan for higher hospital class
Over and above the basic MediShield Life, it will cover 9 out of 10 Class B1 hospital bills
By Salma Khalik, Senior Health Correspondent, The Straits Times, 16 Mar 2016

Singaporeans wanting insurance coverage for a higher hospital class than that provided by the basic MediShield Life can opt for a new standardised package from five private insurers from May 1.

This new Integrated Shield Plan (IP) will cover nine out of 10 Class B1 public hospital bills, and will give people the option for coverage beyond Class B2/C at affordable premiums.

The Ministry of Health (MOH) worked with the five private insurers to develop the key features of the new Standard IP, following public feedback to the MediShield Life Review Committee that there was demand for such coverage.

Class B1 offers some benefits over the lower Class B2/C such as air-conditioned four-bed wards, instead of non-air-conditioned wards with six beds or more, and the option to choose one's doctor.

People now on Class B1, Class A or private hospital plans would also be able to switch to this option.

The benefits of the new IP are identical across insurers, with claims limits such as $1,700 a day for a patient in a B1 ward, and $2,900 a day in intensive care.

But the five insurers will be charging different premiums, which can differ by as much as $1,683 a year.

In announcing the new IP yesterday, MOH said this was due to "each insurer's commercial considerations and risk assessment frameworks".

Launched last November, MediShield Life gives all 3.9 million Singaporeans and permanent residents a basic health insurance plan which covers them for life.

It helps to pay for large subsidised hospital bills and selected outpatient treatments, such as dialysis and chemotherapy.

Those who choose to stay in a Class A or Class B1 ward or in private hospitals can buy an IP for additional coverage.

Almost two in three people have IPs, of which 56 per cent are for private hospitals, 25 per cent for Class A and 19 per cent for B1. There are seven B1 IPs, but only four accept new policyholders.

The new standard no-frills B1 plan, like MediShield Life, does not pay for pre- and post-hospital treatment, unlike most IPs now.

The five insurers will send letters to existing B1 policyholders to offer them the choice of switching to the standard plan. As agreed with MOH, they will not raise premiums for two years. Premiums can be fully paid for with Medisave, at least up to the age of 75.

Mr Khoo Kah Siang, president of the Life Insurance Association of Singapore, said the plan will appeal to people who want more coverage than MediShield Life, or who want to downsize from their existing private plans.

They should not look only at premiums when deciding on an IP, he said, as premiums are not guaranteed and insurers "may raise premiums differently over time".

A new Standard Integrated Shield Plan (IP) targeted at Class B1 coverage will be available from all IP insurers from 1...
Posted by Ministry of Health on Monday, March 14, 2016

Is the standard B1 Integrated Plan for you?
A standard, no-frills medical insurance plan pegged at the private B1 class in public hospitals will be rolled out from May 1. All five insurers offering private health insurance plans integrated with MediShield Life will offer this standard B1 plan, which has benefits set by the Ministry of Health. The standard B1 Integrated Shield Plan (IP) is meant to be affordable and easily understood. Health Correspondent Salma Khalik answers some questions on this new plan to help you decide whether it is suitable for you.
The Straits Times, 16 Mar 2016

Q: Why does the standard B1 plan fully pay for only nine out of 10 B1 bills?

A: There are caps on payment that should be enough to cover most B1 treatments. However, should the patient suffer from complications, the treatment cost might bust the limits.

There is also a $150,000 annual limit on claims. A patient who is frequently in and out of hospital might chalk up bills in excess of this within one year. The excess amount will not be covered.

Q: I'm thinking of downgrading my current IP. Should I change to an insurer that charges lower premiums for the standard B1 IP?

A: That depends on whether you suffer from any medical conditions. If you do, switching to a different insurer might mean that treatment for these conditions will not be covered. If your current insurer covers you fully, it will allow you to downgrade without penalty. In other words, you will still be fully insured.

Furthermore, there is no guarantee that an insurer will still charge the lowest premiums in future.

Q: I have only MediShield Life. Should I upgrade to the standard B1 IP?

A: That depends on the ward class you are likely to choose should you be hospitalised. If you plan to stay in a subsidised ward, then the basic MediShield Life should be enough.

Remember that you will need to pay the deductible - the first $1,500 in C class, $2,000 in B2 and $2,500 in B1 each year if you are 80 years and younger, with the amount higher for older people - as well as the 10 per cent co-insurance for the rest of the bill.

One advantage of having an IP is the higher amount claimable for kidney dialysis. The standard B1 plan pays up to $2,750 a month for this while MediShield Life pays only $1,000. This is an important consideration if your income bracket does not qualify you for subsidised treatment.

Q: I have a B1 IP. Should I switch to the standard B1 IP?

A: Current B1 IPs offer different benefits. You need to compare what you now enjoy with the benefits of the standard B1 plan and decide which suits you better.

In terms of premiums, the standard B1 IP will cost less than an "as charged" B1 plan.

Q: What's the difference between "as charged" and non "as charged" IPs?

A: An "as charged" IP will pay based on the actual bill of the relevant ward class. A non "as charged" IP will pay only up to the claim limits it has set.

Q: I just paid my MediShield Life premium when it was launched on Nov 1. Do I lose the "unused" part of the premium if I switch to the standard B1 plan on May 1?

A: No, your insurer will adjust your new B1 premium accordingly.

Q: Do I need to take up the B1 plan by a certain age?

A: No, there is no age limit. However, if you are a new policyholder with the company, the insurer has the right not to cover you for any pre-existing illnesses.

Which is the right healthcare plan for you? Here is a summary of MediShield Life, the new Standard IP and other existing IPs.Find out more about the Standard IP at
Posted by CPF Board on Wednesday, March 23, 2016

New B1 insurance plan fails to address some concerns
By Salma Khalik, Senior Health Correspondent, The Straits Times, 17 Mar 2016

Medical insurance just got more confusing.

This week, the Ministry of Health (MOH) announced the introduction of a standard B1 plan for those who want basic medical insurance coverage at the B1 level. That's one class above the B2 level that MediShield Life covers. At B1, patients can choose their doctors and enjoy air-conditioned rooms.

The new B1 standard plan is one of several Integrated Plans (IPs) that people can buy to enhance their MediShield Life coverage. It is the most basic of IPs. The problem is that it is anything but standard.

The so-called B1 standard plan, which becomes available on May 1, comes with different premiums, depending on which insurer a person buys the plan from.

MOH said it created this standard B1 plan in response to public feedback on four aspects of insurance coverage related to the launch of MediShield Life last November. They are:

• Demand for affordable IPs that provide coverage beyond subsidised treatment;

• Concern about the affordability of IP premiums over time;

• Flexibility to reassess choice of IP over time and downgrade to a cheaper plan if needed, with many saying B1 would be enough;

• Confusion about benefits since different plans offer different things.

The question is, does the introduction of the standard B1 IP address these concerns? In my opinion, the answer is "No".

Let's look at each of the four concerns in turn.


MOH has decided to leave it to insurance companies to decide on the premiums they want to charge. All MOH has insisted on is a set of standard, no-frills benefits.

As a result, premiums for the identical product do vary, by as much as $1,863 a year.

One wonders if some of these insurers are charging high premiums to discourage people because they really do not want to offer this standard IP, whether because they already have their own B1 plans or because they see little profit in this.

Furthermore, these premiums will remain unchanged only for two years, after which insurers are free to raise premiums.

So while this standard B1 plan might be affordable today, there is no guarantee that it will remain so in future.

In fact, the president of the Life Insurance Association of Singapore, Mr Khoo Kah Siang, has already warned of future hikes, saying: "IP premiums are not guaranteed and therefore different insurers may raise premiums differently over time."

The only concession to keeping this IP affordable is that it comes with no frills, so premiums will likely be lower than for those B1 IPs that come with bells and whistles.

Having said that, depending on insurer and age group, there are premiums for this standard no-frills B1 plan that cost more than some as charged B1 plans and even Class A plan for people of the same age group.

That is rather inexplicable.


People worry about IP premiums rising over time and how they can afford to keep paying, especially after retirement, says MOH.

Yet, the premiums for the standard B1 plan for people over age 75 already exceed the Medisave withdrawal limits for most in this age group. They will have to top up in cash and that makes the plan less affordable to them.

The MediShield Life Review Committee had recommended that "the premiums for the Standard Integrated Shield Plan should form the basis for setting Medisave Withdrawal Limits" for such plans.

In the spirit of this recommendation, the full premiums for this plan should be payable by Medisave. But given the huge difference in premiums of almost $2,000 for older age groups, that is surely not possible.

To address people's concern about runaway premiums, MOH could have set a cap of a certain percentage increase a year. But it has not.


Many people are of the view that B1 class treatment would be sufficient for them once they have retired. With the introduction of the new standard B1 plan, all those who have bought or intend to buy IPs will be able to downgrade to a B1 plan if they wish.

In my view, there are better ways to achieve this end but, at least, this particular public concern has been addressed.


This concern, unfortunately, remains.

That's because with the introduction of the standard B1 plan in May, there will be a total of 12 B1 plans. True, three no longer accept new policyholders. That leaves nine B1 plans to choose from.

People's confusion over the different plans on offer could have been addressed if the standard B1 plan had replaced all existing B1 plans, so there is only one set of benefits for people to look at.

But doing so could have upset those who are on "better" B1 plans. After all, the standard plan comes with no frills, while some of the existing B1 plans offer more coverage, although at higher premiums.

For example, several existing B1 plans cover pre- and post- hospital treatment for up to 120 days. Some cover bills "as charged" with no treatment cap, so long as the treatment takes place in a public hospital B1 class.

With the plethora of B1 plans, it has just become harder to decide.

How important are pre- and post- hospital coverage? Is it worth paying slightly more for an "as charged" plan?

After all, MOH has said that the standard B1 plan would cover only 90 per cent of big B1 bills. The question people will ask is: Will that be enough for me?

Currently, fewer than 500,000 people, or just 19 per cent who have IPs, have opted for B1 coverage. By adding more B1 plans, is the ministry simply splitting the risk pool further? Will this result in greater premium fluctuation?

Looking at various IP categories today, generally the insurer with a larger market share tends to charge lower premiums while the insurer that has the smallest number of policyholders charges the most.

That makes sense, since one immense bill - if shared among a small pool of policyholders - could send premiums sky-rocketing. Knowing that, those insurers with fewer policyholders would need to protect themselves with higher premiums.

That same bill, shared by a large number of policyholders, would have a smaller impact. As these insurers face lower risks, they can afford to charge a lower safety margin.

By extension, diluting the B1 market could result in higher than necessary premiums.

If instead, all those who want the standard B1 plan form just one pool, then there is not only greater long-term stability, but it will also mean that everyone within an age group pays the same premium for the same benefits - instead of the current system where some pay more and others less for exactly the same coverage.

With health insurance, it's not a matter of just picking the cheapest on the market. That's because the majority of older people have developed some chronic ailments that might result in exclusions should they change to a different insurer.

One way of ensuring both standard benefits and premiums is if the Central Provident Fund (CPF), which manages the basic MediShield Life, also runs this standard plan. It could then allow for people to downgrade from a higher IP with no penalty.

Alternatively, if the CPF does not want to administer the scheme, it could tender it out to one of the five insurers to manage. The other four would get a commission for passing on their existing policyholders who opt for the scheme.

That way, there will be only one standard B1 scheme, making it easier for people to choose an insurance plan that suits them best. With a larger pool of policyholders, premiums can also remain more affordable over the long term.

It will also not eat much into existing IP business as more than four in five people are choosing IPs that cover Class A or private hospital treatments.

Some would also prefer to choose as charged B1 plans that offer more coverage.

The standard B1 IP will serve, as originally meant, as a safety net for those who want more than subsidised care.


MEDISHIELD LIFE: This is the national health insurance that covers all Singaporeans and permanent residents for life. The coverage is enough for most treatments in the subsidised C and B2 class wards in a public hospital.

INTEGRATED SHIELD PLAN (IP): This provides coverage additional to MediShield Life. There are three categories of IP pegged to treatments at public hospital Class A and B and at private hospitals. The premiums for IPs include that for MediShield Life.

UNDERWRITING: While MediShield Life will cover everyone, including those who are already very sick, private insurers are not obliged to do the same. They can refuse coverage, or exclude cover for medical conditions that exist at the time the person buys the insurance.

STANDARD B1 IP: This is the new plan starting on May 1 that all five IP insurers must offer. It is meant to provide coverage higher than subsidised care, at affordable prices in an easily understood package.

* Basic insurance through MediShield Life remains focus

Senior health correspondent Salma Khalik ("New B1 insurance plan fails to address some concerns"; last Thursday) and opinion editor Chua Mui Hoong ("Standard B1 health plan: A missed opportunity to bring private health insurers to heel"; ST Online, Sunday) urged the Government to do more with the Standard Integrated Shield Plan (Standard IP), beyond standardising the benefits of the plan.

The Government's focus is to provide basic and affordable health insurance coverage for all Singaporeans through MediShield Life, regardless of their health condition.

Therefore, MediShield Life is designed to provide sufficient coverage for subsidised Class B2/C wards.

Singaporeans who wish to have coverage beyond MediShield Life can purchase private IPs, which will come at higher premiums than MediShield Life, due to the additional private insurance component.

The Standard IP was developed in response to the MediShield Life Review Committee's recommendation in 2014, to provide a "no-frills" IP option, for those who want to switch from their more expensive IPs to a more affordable one, and for those who wish to have higher coverage beyond MediShield Life.

The Standard IP was also designed to have standardised features to facilitate comparison of premiums by consumers.

Like all other IPs, Standard IP coverage is optional and it is not intended to meet the needs of all Singaporeans. Underwriting for the additional private insurance component is therefore necessary.

Otherwise, there will be adverse selection, where individuals may purchase the higher coverage only after they have fallen ill, leading to higher premiums for all, including for healthy policyholders who joined earlier.

While MediShield Life covers all Singaporeans for all health conditions, those with serious pre-existing conditions pay additional premiums, as a reflection of their higher risks and to fund part of their coverage.

The Government bears the bulk of the cost of covering those with pre-existing conditions.

The Government's focus remains to provide basic universal healthcare coverage for all Singaporeans through MediShield Life, with IPs as an optional private plan providing higher than basic coverage.

The Ministry of Health will continue to review MediShield Life and IPs, to ensure that they remain relevant to Singaporeans with different needs.

As our population ages, we must also focus on promoting healthy living and active ageing, transforming our care models, and improving productivity to keep our healthcare system sustainable and affordable for all Singaporeans.

Lim Bee Khim (Ms)
Corporate Communications
Ministry of Health
ST Forum, 24 Mar 2016

Balance benefits, savings in changing IP

Options available for private plan holders looking to downsize, other than new B1 plan
By Lorna Tan, Invest Editor/Senior Correspondent, The Sunday Times, 3 Apr 2016

Come May 1, Singaporeans will have another option for affordable healthcare in the form of a standard Integrated Shield Plan (IP) targeted at class B1 ward in public hospitals. It is expected to appeal to two groups: people seeking a higher hospital class than that provided by the basic MediShield Life (ML), and those looking to downsize from their existing private plans.

My parents fall into the second category.

Currently, 64 per cent of Singaporeans have IPs. Of these, 56 per cent have policies covering stays in private hospitals, 25 per cent for class A ward in public hospitals, and 19 per cent for class B1 ward in public hospitals.

For more than a decade, my brother has been forking out the premiums for my parents' hospitalisation insurance plans. As they have grown older, their premiums have also edged up.

With the launch of the standard IP, it is timely to review our parents' healthcare needs and costs.

Should we downgrade our parents' plans to the standard IP? What savings would we enjoy and what benefits would my parents have to do without? What other options are there to achieve premium savings?

My dad, 81, has an Enhanced IncomeShield Basic plan, which means it covers class B1 and below of restructured hospitals, such as National University Hospital. He could opt to be hospitalised at a private hospital, but Income would then pay up to half of the hospitalisation bill.

His current premium, before government subsidies, is $1,250 for the ML component and $1,275 for the additional private insurance coverage - a total premium of $2,525. He also has a Plus rider covering the deductible and co-insurance hospital bill portions - costing $1,318 a year.

My mum, 76, has an Enhanced IncomeShield Advantage plan, covering class A and below of restructured hospitals. Her premium, without taking subsidies into account, is $3,007 and her Plus rider amounts to $1,482. Their combined annual premiums are hefty at $8,332. A portion is payable from Medisave and the rest in cash.

To recap, the standard IP is a no-frills private insurance plan offered by all six IP insurers: AIA, Aviva, AXA, Great Eastern, NTUC Income and Prudential.

They will offer the standard IP with identical benefits that provide coverage on top of ML but the premiums will vary. The six insurers have agreed to keep premiums of the new B1 plan unchanged for the first two years.

Those with class B1, A or private hospital IPs who wish to downgrade with their existing insurer can do so without additional underwriting or undergoing a medical test. An exception is Aviva policyholders because the insurer practises moratorium underwriting, where medical history declaration is not a requirement for applicants.

The new standard B1 plan will pay for large subsidised hospital bills and selected outpatient treatments such as chemotherapy and kidney dialysis, similar to MediShield Life. Other features include pre-determined claim limits (it is not an as-charged plan), as well as deductible and co-insurance components, in line with efforts to manage healthcare costs. Patients with this plan can choose their doctors and enjoy air-conditioned rooms.

The premiums for Income's standard B1 plan are $2,168 and $1,930 for my dad and mum respectively. Income offers a Plus rider to cover both deductible and co-insurance components of the standard plan and it will cost dad $1,213 and mum, $873.

One clear advantage of downgrading to the standard IP is the annual premium savings of $462 for dad and $1,686 for mum, assuming we include the cost of riders for the standard IP.

However, while there will be savings if we downgrade my parents' plans to the standard one, they will stand to lose some benefits not covered under the new standard IP.

Let's take a look at the three main benefits that my parents will lose.

One key difference between the new B1 plan and most IPs is that the former does not cover pre- and post-hospitalisation benefits. For IncomeShield, such benefits cover the costs incurred during outpatient visits to the hospital three months before and after the hospitalisation.

Another difference is that there is a cap on claims for the new plan. For example, daily ward charges are capped at $1,700 per day, there are limits on surgical costs, and so on.

My parents' current IPs are as-charged plans so we don't have to worry about huge bills as long as they stay in their respective ward classes. As-charged plans also help to hedge against the certainty of rising medical costs.

One consideration I deem important is the annual policy limit which is a lower $150,000 for the standard IP.

Presently, my dad and mum are enjoying higher annual limits of $250,000 and $500,000 under their respective plans.

As I consider the loss of these benefits to be significant, my decision is to rule out the option of downgrading my parents' plans to the standard IP.

Still, I have two other options which can help to save on the annual premiums.

• Downgrade their Plus riders to an Assist rider which covers the deductible and caps the co-insurance portion of their current plans ($2,000 for Basic plan and $2,500 for Advantage plan). The Assist rider will cost a lower $894 for dad (Enhanced Basic plan) and $1,025 for mum (Enhanced Advantage plan). In this case, the annual premium savings would be $424 for dad and $457 for mum.

• Downgrade mum's Enhanced Advantage plan to the IncomeShield Enhanced Basic (as-charged) plan where her annual premium will be $2,156 and her full rider will be $949, resulting in premium savings of $1,384. For greater savings, we can opt for an Assist rider at $686 for her Enhanced Basic plan, which will shave $1,647 off current premiums per year.

Combining both options, I will consider downgrading dad's Plus rider to an Assist rider as well as mum's Enhanced Advantage plan to an Enhanced Basic plan and an Assist rider, resulting in an overall annual 25 per cent saving of $2,071.

I believe that this will be a nice compromise between maintaining the important benefits and achieving substantial yearly savings.

What is an appropriate level of cover?

By Lorna Tan, The Sunday Times, 3 Apr 2016

Buy a plan that matches your healthcare expectations, provided you can afford the premiums. So, if you expect to stay in a class B1 ward, then buy a hospital plan with B1 coverage.

Bear in mind that premiums rise as you age.

Therefore, it is important to ensure that you have sufficient money to fund future premiums. This is to prevent policies from lapsing.

My preference is to buy a higher-class plan now while I can afford it, with a view to downgrading to a lower plan when I am older and premiums are higher.

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