Monday 28 May 2018

ElderShield to be replaced by CareShield Life with higher, lifetime payouts from 2020; Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

New compulsory CareShield Life replaces optional ElderShield in 2020, will offer wider coverage for severely disabled
Scheme to be run by Government instead of private insurers will include everyone from age 30
By Salma Khalik, Senior Health Correspondent, The Straits Times, 28 May 2018

Another piece of the jigsaw to prepare Singapore for its ageing population, a national long-term care insurance to provide financial aid to those afflicted with severe disability, will be launched in 2020.

Called CareShield Life, the government-run scheme will be compulsory, automatically getting everyone who will be between the ages of 30 and 40 in 2020 to start paying premiums. Future cohorts will join at the age of 30.

For them, the scheme replaces the optional ElderShield, offered by private insurers. CareShield's scope of coverage is also wider.

Premiums start at $206 a year for men and $253 a year for women at the age of 30. They will make 38 payments until the age of 67.

Should disability strike and a policyholder require care, he will receive a payout of at least $600 a month, for as long as care is needed.

In contrast, the ElderShield scheme pays $400 a month for up to six years, but with lower premiums paid over a shorter period.

People above 40 in 2020 have the option of sticking with ElderShield or switching to the new scheme in 2021 by topping up their premiums.

Health Minister Gan Kim Yong said that over the past three years, the Government "has been preparing Singaporeans for an ageing population", including providing more nursing home and day-care facilities, the Pioneer Generation Package and MediShield Life.

This review "is another important step in this journey", he said.

"It is an important strategy for us, an important part of our social safety network for Singaporeans in terms of long-term care. It also reflects the inclusive society that we aspire to build."

To ensure premiums are affordable no matter the family's income, Medisave can be used to fully pay for it. There will be permanent premium subsidies of 20 per cent to 30 per cent for people who qualify, and additional support for those who still cannot afford the premiums.

People who are disabled at the age of 30 years will make one premium payment to join, and can start collecting payouts immediately.

Payouts will increase to adjust for the higher cost of long-term care in future, so long as the person is still paying premiums. So, the payout amount in the year they turn 67 will be the payout they receive in future.

To pay for this, premiums will increase over the years.

The recommendation for the scheme to be made compulsory and for the Government to run it was made by the ElderShield Review Committee headed by Mr Chaly Mah. Its report was submitted last Friday to Mr Gan, who said: "The Government accepts the committee's report and agrees with the key recommendations."

Mr Mah said the recommendations hinge on four key points: inclusivity, adequate protection, affordability and sustainability. He said there was "some tension in our own deliberation and discussion on whether $600 was enough or not". But higher payouts would mean higher premiums.

The committee also urged the Government to provide incentives and subsidies to encourage older people, for whom it is not compulsory, to join CareShield Life.

Dr Chia Shi-Lu, head of the Government Parliamentary Committee for Health, said the GPC agrees it should be mandatory as it is an "integral part of our social safety net".

It also wants the Government to run the scheme "so there is less concern about commercial interests affecting premium and payout adjustments". Dr Chia said: "It would be naive to say that commercial calculations do not play any role."

Those on ElderShield will be able to upgrade from 2021
By Salma Khalik, Senior Health Correspondent, The Straits Times, 28 May 2018

People aged 40 years and older who are on ElderShield and want to upgrade to CareShield Life will be able to do so from 2021, the year following the launch of the new long-term care insurance.

They will need to pay more in premiums as the payout from the new government-run scheme will be at least 50 per cent higher, and will be for life instead of just six years that ElderShield offers.

Even those who have opted out of ElderShield may choose to join, but they must not already be suffering from severe disability.

How much they will need to pay will be announced later.

However, there will be no obligation for people who are over 40 years old in 2020 to join the scheme, which will be compulsory for those aged 40 and younger.

Mr Chaly Mah, who headed the ElderShield Review Committee, said the report recommends that existing cohorts should join and that the Government offer them "incentives and subsidies" to do so.

It also suggested that for these people, premium top-ups should be paid over five to 10 years, even if doing so means that people will be paying beyond the re-employment age of 67 years.

It said: "This is a reasonable and effective design to lower the annual premiums payable, so that more Singaporeans in existing cohorts would consider joining the enhanced scheme."

Mr Mah said that even those who have opted out of ElderShield should be allowed to join CareShield Life.

Health Minister Gan Kim Yong gave an assurance that the Government will provide subsidies and incentives to encourage older cohorts to join CareShield Life, which offers better and longer payouts.

He said there will be some underwriting, but there will be no age limit for older people to join the scheme. "But for older folk, the premiums will be quite significant. The older you are, the more challenging (it is) to join the scheme," he said. So, whether it is beneficial for them to participate will depend on their ability to pay and their needs.

Dr Chia Shi-Lu, head of the Government Parliamentary Committee for Health, who will be 50 years old in 2021, said: "I would like to join once it is launched. And later joiners should also access the same assistance scheme as the new joinees."

Dr Jeremy Lim, a partner at consultancy firm Oliver Wyman, said: "I hope the Government works out a mechanism for the existing cohort to move over to CareShield Life that is equitable to the ElderShield enrollees, the CareShield Life enrollees, the insurers and the taxpayers."

ElderShield has been around since 2002, with people aged 40 automatically included unless they opt out. Many opted out in the initial years, but more recently, the opt-out rate has stabilised at around 5 per cent.

There were 1.3 million ElderShield policyholders at the end of last year, and they have contributed $3.3 billion in premiums. About $133 million has been paid out in claims.

The bulk of policyholders are on ElderShield 400, which was introduced in September 2007 to provide better coverage.

The original ElderShield 300 provided $300 a month for up to five years. It was replaced by the new scheme, which pays out $400 for up to six years.

Both schemes are run by private insurers, which also offer supplements to top up the ElderShield payout and/or provide payouts for longer periods.

In 2016, the 14-member ElderShield Review Committee was set up to see how long-term care insurance could be improved.

CareShield Life: What you need to know
The Straits Times, 28 May 2018

Name: CareShield Life

When it will start: 2020

Who it affects: All Singaporeans and permanent residents aged 40 and younger in 2020.

What they need to do: Pay annual premiums using Medisave from the age of 30 to 67.

Premiums: $206 for men and $253 for women in 2020. This will go up by 2 per cent a year for the first five years. Future increases will be announced later.

Subsidies: Subsidy of 20 per cent to 30 per cent for Singaporeans with per capita household income of $2,600 or less. Permanent residents will receive half of the subsidy.

• Additional premium support for those who are still unable to pay the premiums.

• Transitional subsidy of up to $250 for Singaporeans in the first five years.

What it provides: Monthly payouts for people who are severely disabled.

Amount of payout: $600 a month for claims made in 2020. Like premiums, it will increase by 2 per cent a year for the first five years. It will continue to increase beyond that at a rate to be determined later. The amount of payout a person is entitled to increases annually until the age of 67 years, or until a person makes a claim, whichever is earlier. Length of payout: For as long as the person remains disabled.

What payout can be used for: Anything.

Key recommendations from the ElderShield Review Committee:

• For all residents from the age of 30 years.

• Lifetime payouts for the severely disabled.

• Payouts to start at $600 in the first year, increasing over time.

• Premiums to be adjusted for the higher payouts.

• Premiums to be paid over a longer period, from age 30 to 67.

• Premiums to be fully payable with Medisave.

• Means-tested government subsidies.

• Simplify the claims procedure.

• Government to run the scheme.

• Encourage older people to join.

• Rename it CareShield Life and raise awareness of the scheme.

Good that Careshield Life is inclusive, but payouts need to be higher: Young Singaporeans
They praise inclusivity of CareShield Life but say $600 a month will barely cover expenses
By Felicia Choo, The Straits Times, 28 May 2018

The new long-term care insurance that replaces the ElderShield scheme in 2020 for younger cohorts with one that has more support for those with disabilities was broadly welcomed, even as some called for higher payouts.

Singaporeans and permanent residents set to be affected by the change generally praised the inclusivity of CareShield Life, but felt the initial cash payout of $600 a month would barely cover their expenses.

"It is enough for now because I am still working," said graphic designer Benson Tiew, 38, who needs a wheelchair to get around after a traffic accident in 2002 left him paralysed from the waist down.

"But it won't be enough for my living expenses when I stop working and have to live on my own with a domestic helper."

His 66-year-old mother is the main caregiver to him and his father, 69, who suffered a stroke 13 years ago. Mr Tiew, a PR who did not have any disability insurance before his accident, thinks a payout of at least $1,000 would be adequate.

His three younger brothers help pay the family's expenses, while Mr Tiew spends only $200 to $400 of his $1,500 monthly salary, but that amount can double with wheelchair maintenance.

Caregiver Suresh Vanaz, 39, agrees that the payouts need to be higher. His brother Gunaseelan Purushothaman, 34, has cerebral palsy and racks up $4,000 worth of hospitalisation, medication, transport and other living costs a month.

"Financially, it is a good help, but it is still a very small amount," said Mr Suresh, who has been taking care of his brother with a maid for the last 12 years since their mother died. He does acting and hosting part-time because his caregiving duties prevent him from holding down a full-time job.

Mr Suresh thinks that the monthly payouts from CareShield Life need to be at least $2,000, given his brother's situation. "Whatever I save goes to him, and he is not able to be covered by any insurance," he said of his brother, who is in the hospital after a seizure last week.

Another point of concern is the ability of less severely disabled people who do not qualify for the payouts to afford the yearly premiums.

"We are happy that the scheme is becoming more inclusive because it is very hard for people with disabilities to get insurance," said Dr Marissa Lee Medjeral-Mills, executive director of the Disabled People's Association. "But given their low employment rate, I hope there can be means-tested subsidies for those who are already disabled and may have more disabilities later in life."

She added that the payout needs to be higher than $600, but more research needs to be done to find out the average monthly living expenses for people with disabilities to determine an accurate amount.

Singaporeans without disabilities acknowledge the prudence of joining CareShield Life at a younger age, but some would like to have a say in opting out as well as a limit to how high premiums can go.

Ms Guo Li Quan, 30, said she would stay on CareShield Life even if it was not compulsory as she feels it is a cheaper alternative to private insurance plans.

"I would like to be assured of a certain cap on the premiums," said the senior human resources executive. "If there is any need to put in more money, then it would be encouraging to see the Government come up with that, with everyone chipping in."

A good scheme, but a few puzzling questions remain
By Salma Khalik, Senior Health Correspondent, The Straits Times, 28 May 2018

Everyone aged 40 years or younger in 2020 will have no choice but to join CareShield Life, the new long-term care insurance that the Government will be running.

While some may baulk at another compulsory health insurance programme - today, about 5 per cent of people opt out of ElderShield - the move to include all does help solve some of the problems with its predecessor.

By making the scheme compulsory, everyone can be assured of some financial help if they end up with a severe disability.

The government subsidy will ensure that all can afford the premiums.

One gripe against the existing ElderShield scheme is that the monthly payout of $400 is too low, and the six-year limit on payouts leaves those who live longer out on a limb.

CareShield Life places no limit on how long a person who suffers a disability can receive payouts.

The projected median duration of disability is four years for the 30 to 40 year olds joining the scheme in 2020, with three in 10 living with severe disability for at least 10 years. So, removing the limit will be comforting for those in need of longer-term care.

The payouts will also start at $600, or 50 per cent higher than ElderShield's. The plan is for payouts to increase, to match the increasing cost of care needs.

This does add uncertainty to the scheme as premiums will also go up by an unknown amount, so no one knows how much they will need to pay in premiums 20 or 30 years after they join the scheme.

The premiums are determined by many factors - including how many people make claims, how long they make the claims for and how much is paid out to them every month.

If there are more and higher claims, the premiums will have to increase substantially. The level will also depend upon whether the Government can meet, or exceed, the assumption of 4 per cent annual returns on funds invested.

At least there is the assurance that the payouts should be enough to meet the basic needs of people with severe disability in the future.

Obviously, not everyone would need it.

The Ministry of Health (MOH) said one in two healthy people aged 65 years and older is expected to become severely disabled before his death. For some, it would be a short period of weeks or months. For the less lucky, it could drag on for years.

At the same time, the scheme provides coverage for something people cannot totally avoid through healthy living. Even a healthy person can be laid low by an accident.

Having the Government run it makes sense as it cannot be inclusive if it is run by private insurers. It will not be fair to expect them to cover people who are already disabled at the age of 30 - in other words, from Day One.

But two points have me puzzled.

Giving subsidies to help the poor is a positive. But why a transitional subsidy for the first five years? If this is given to every cohort to ease them into the scheme, fine.

But it is not. It is only for the first five years of the scheme.

MOH said it is because 30-year-olds may not have put aside the necessary money.

Why would they need to? The premiums come from Medisave, not the Ordinary Account which people might need to pay for their house or other expenditure.

And it would be rare for 30 to 40 year olds not to have a decent balance in Medisave. But if some do not, then the same would apply to future cohorts.

The Government may have money to spare, but it should be used wisely and fairly.

Yes, women do live longer. They may even suffer from more disability years, though the local data for this is not robust.

But the scheme has been touted as embodying social inclusiveness and collective responsibility.

That being so, shouldn't both genders pay the same premiums?

The committee's argument - that this is how insurance companies do it - is not compelling. Those companies are profit-making entities.

CareShield Life is a not-for-profit scheme run by the Government for the people. We should approach this as a nation united, to help fellow citizens in need, be they men or women.

We should "Care", as the name of the scheme suggests.

CareShield Life: What you need to know about the new scheme
By Salma Khalik, Senior Health Correspondent, The Straits Times, 29 May 2018

A new long-term care insurance, called CareShield Life, will be launched in 2020, and will be compulsory for everyone aged 40 years and younger in that year. The Government has promised financial help for people from lower-and middle-income households, and for those who have trouble paying the premiums.

Here is what you should know about this new scheme:


A MediShield Life insures you for high hospital bills or expensive medical treatments such as for cancer.

CareShield Life is to help you financially should you become severely disabled and require long-term care. The payout is in cash every month so you may do what you like with it, such as employing a helper, or offsetting the cost of daycare.


A To qualify, you must need help in doing at least three of the six activities of daily living (ADLs). These are bathing, dressing, eating, toileting, transferring such as from bed to chair, and moving from room to room.

You need to get a qualified healthcare worker such as a doctor, nurse, physiotherapist or occupational therapist to certify your status.

It is free the first time you do an assessment. But if you are found to not need help with at least three ADLs and need to do another assessment later, you need to pay the cost of it. If you are deemed to need help with three ADLs, you will be reimbursed the fee by CareShield Life.


A The payout will depend on the amount in force at the time you make your claim. In 2020, it is $600 a month. Once you start claiming, you will continue to get the same amount every month so long as you remain disabled.

If you become severely disabled after the age of 67, you will get the payout in force when you were 67 years old, in other words, the year you paid your last premium. There is no time limit for how long the payouts are given.


A Anything. The cash is yours outright.


A With ElderShield, the payout amount is fixed at $300 a month for up to five years or $400 a month for up to six years, depending on the scheme you are on.

With CareShield Life, the payout will increase over time to offset the higher costs of care in the future. The amount of increase may vary, so it is not possible to know, upfront, the total amount of premium that needs to be paid.


A The premiums to be paid will depend on the payouts, which will increase over the years, as well as the amount of claims made against the scheme. Inflation is also a factor.

If more claims are made than anticipated, premiums will have to go up to keep the fund solvent. On the other hand, should the claims made be less than expected, then the increase in premiums may slow down.


A The payout amount is not age-based. It will go up annually based on the year in which you first make a claim. Two people of different ages making their first claim in the same year will get the same monthly payout.

However, the payout for people older than 67 will be pegged at the payout amount in the year they stop paying premiums, at the age of 67.


A There are three levels of permanent subsidies:

• 30 per cent if you are from a household with per capita monthly income of $1,100 or less.

• 25 per cent if it is between $1,101 and $1,800.

• 20 per cent if it is between $1,801 and $2,600. If you still cannot afford to pay the premiums, the Government will make up the shortfall for you. There will also be transitional subsidies for Singaporeans that range from $70 in 2020 to $30 by 2024. Those who join in 2020 will get a total of $250.


A You may use the Medisave savings of a family member, such as your child, to pay the premium. You can also pay in cash.

If those options are not possible for you, you will be means-tested and if you qualify for subsidies, the Government will pay the outstanding amount for you.


A Yes, but only from 2021. You will need to top up your premiums to switch to CareShield Life. Those who had opted out of ElderShield may also join. Details of how this can be done will come later. However, people in these groups who are already severely disabled will not be able to join CareShield Life.


A No, CareShield Life is an all-inclusive long-term care insurance, so no one will be left out. You will need to pay the first premium at the age of 30 to join the scheme.

Since you already require help with three ADLs, you will be able to collect the monthly payout the same year. Once you start collecting the payouts, you no longer need to pay any premiums.


A No, CareShield Life is compulsory for all Singaporeans and permanent residents. It does not matter if you do not reside here. If you need help with three ADLs, you will be given the payout which is in the form of cash.

MediShield Life is different as it pays for treatment that has to be carried out here.


A Yes. Plans that add an additional amount to the monthly payouts will likely be available from private insurers.

CareShield Life scheme aims to make claims process easier
Doctors and caregivers welcome the addition of nurses and other healthcare professionals to pool of assessors
By Felicia Choo, The Straits Times, 29 May 2018

The new CareShield Life insurance system will aim to make the claims process easier than it is under the current ElderShield scheme when it takes effect in 2020 - a move welcomed by doctors and caregivers.

The ElderShield Review Committee on Friday submitted a report containing a slew of recommendations - accepted by the Government - for when the system is revamped, which include opening up the pool of assessors to include occupational therapists, physiotherapists and nurses.

Assessments by healthcare professionals who are not accredited will also be accepted. Currently, assessments can be carried out by 120 general practitioners (GPs), only 13 of whom make house calls.

Madam Sarah Liew was unable to find a GP willing to go to her 85-year-old mother's home in Clementi three years ago to assess her for dementia.

The 61-year-old part-time bank associate said: "The hassle was getting the assessment done... I needed to find a clinic that is accessible by MRT, because my mother is wheelchair-bound and it's very difficult to transfer her from the wheelchair to the taxi."

She added that the family had "totally forgotten" that her mother was covered by ElderShield until they were reminded by staff at her mother's care centre.

Insurance agent Carin Soh, 42, also struggled to find an assessor for her 78-year-old father who applied for the ElderShield 300 claim after a second cardiac arrest two years ago. She believes the new system will be an improvement.

"I had to call every doctor on the list to check until I finally found one who would go to the community hospital in Changi," said Ms Soh. "That was the main frustration I had - that the doctors in the hospital couldn't do the assessment themselves."

Doctors interviewed agreed that assessments should be made more accessible, but added that the process can be further simplified.

Dr Chua Boon Ling, a GP from Simon Road Family Clinic, said it is easier to assess people in their homes, but many prefer to do it in the clinic because it is cheaper.

Currently, it costs $50 for a clinic assessment and $150 for a non-clinic assessment under ElderShield. Fees are reimbursed for successful claims.

But these prices are set to increase, based on recommendations from the ElderShield Review Committee, to reflect the adjustment of salary norms over time. To make it affordable, fees for the first assessment will be waived under CareShield Life - even if the claim is unsuccessful.

"It's quite a fast assessment, but the claim form is not very user-friendly," said Dr Chua.

For example, the difference between the grading levels for each activity of daily living can be quite small and nuanced, making it hard to assess the patient.

Dr Paul Ang, of Zenith Medical Clinic, believes the changes give allied health professionals a greater scope of practice and encourage doctors to work with them. However, he would like to see patients given more help to access the help they need.

"Now a lot of onus lies on the patient and family to try to apply for them," said Dr Ang. "What if they cannot fill up forms, or they don't know that they already qualify for these benefits?"

CareShield Life a major upgrade
The Straits Times, 29 May 2018

The stress of caring for disabled family members has long been a source of concern for Singapore society, with periodic reports of family members unable to cope resorting to extreme measures. A new government-run long-term care plan covering disabled people in their adult years will go some way to alleviate at least the financial worries. The CareShield Life plan will launch in 2020 and cover all Singaporeans and permanent residents aged 40 and below from that year. People will start paying annual premiums using Medisave from the ages of 30 to 67, of $206 for men and $253 for women in 2020. Premiums go up 2 per cent a year for the first five years. Future increases will have to be determined.

CareShield Life is clearly superior to ElderShield, the long-term disability plan launched in 2002 which covers Singaporeans and permanent residents once they turn 40. The new plan is mandatory, which means younger, healthier people can't opt out, ensuring a more sustainable risk pool. It offers better protection - higher payouts of $600 a month, for as long as needed, compared to $400 for six years for ElderShield. Premiums are higher, but can be paid fully from Medisave.

CareShield Life is a major upgrade to Singapore's growing social safety net. It continues the trend of pooling risks across a community that began with MediShield, rather than depending on individuals' savings to meet large care bills. As with MediShield Life and CPF Life's annuity plan, it offers coverage for life and does not stop as one approaches an infirm age. It brings adult disability within the growing umbrella of social protection coverage managed by the state. This is particularly timely given the fast-ageing population.

Teething problems remain, chief of which is how to fit the 1.3 million ElderShield members equitably into CareShield Life. Some may also quibble at CareShield Life's relatively modest payout and ask why premiums will vary after the first five years. The short answer is that it has to be kept affordable and sustainable, which means premiums have to be aligned with claims. As future claims are not known, premiums can't be pre-set.

Here, there is a need for Singaporeans to shift from self-maximising behaviour (claiming the maximum that one is entitled to) to community-enhancing behaviour (staying healthy, and claiming only when one is in need). Individual behaviour affects the sustainability of the pool.

With adult disability now covered by long-term care insurance, a family with a disabled child gets some respite once the child turns 30; and can make claims from CareShield Life. This raises the natural question: Can there be a national disability plan covering children and young adults?

It is probably very early days yet for such a move. But as Singapore moves to widen its social safety net, that is the obvious next big step.

Current ElderShield insurers should return surplus premiums to MOH

A recent report said that private insurers collected $3.3 billion in premiums for ElderShield and only about $133 million has been paid out in claims (Those on ElderShield will be able to upgrade from 2021; May 28).

This raises the question of how exactly the surplus is used.

In 2020, the state will take over the underwriting and, assuming that existing, though not all, ElderShield policyholders decide to upgrade to CareShield Life, what are the insurers going to do with the surplus and how?

By 2021, the insurers would have accumulated more surplus.

Therefore, it is necessary for them to transfer the surplus to the Ministry of Health, minus rebates given to their policyholders, to help lower the premiums of CareShield Life.

While we understand the need to keep the surplus as reserves to pay for future claims for disability as well as to provide lifetime coverage for policyholders even after they turn 65 and stop paying premiums, such reserves become obsolete when ElderShield policyholders migrate to CareShield Life.

That removes the risk from ElderShield providers.

Because our Government takes over the coverage, there is no risk for the insurers to be able to provide adequate coverage for policyholders as our population ages nor is there a need to set aside amounts for future claims.

Presently, nobody knows the claims-to-premiums ratio since the insurers started collecting premiums in 2002, nor the accumulated interest and investment returns on the excess premiums over the past 16 years.

Rightfully, whatever the surplus, including interest earned and returns on investment, it should be transferred to MOH.

There are many people, including myself, who have been paying ElderShield premiums for many years without claiming.

These are the people who help to contribute to the pooling system of ElderShield.

They should be given rebates on the CareShield Life premiums, on top of the subsidies.

MOH must mandate that the three private insurers return all the surplus premiums, including interest and investment income, to the ministry.

The extra revenue will certainly help to offset the higher CareShield premiums.

Cheng Choon Fei
ST Forum, 31 May 2018

* ElderShield premiums collected meant to support future claims

Long-term care insurance like ElderShield works by pooling together premiums paid by policyholders in their younger years while most are still working (Current ElderShield insurers should return surplus premiums to MOH, by Mr Cheng Choon Fei; May 31).

These funds are collected and invested, so that they are available in future years, when policyholders are no longer paying premiums and are more likely to suffer from severe disability.

Premiums collected under ElderShield currently exceed the claims paid out because the age profile of ElderShield policyholders is relatively young, with a median age of 52.

The premiums collected are not surpluses. They are meant to support future claims, when ElderShield policyholders become older and more of them become severely disabled and start to make claims.

To illustrate, annual claims paid out have risen by 12 per cent per year from 2013 to last year, much faster than the 3 per cent increase per year in premiums collected over the same period.

We expect this trend to continue, in tandem with the ageing demographic profile of policyholders.

The Government will be administering CareShield Life on a not-for-profit basis. Any surpluses generated will stay within the fund and go towards benefiting policyholders through higher payouts or premium rebates.

For ElderShield policyholders who wish to join CareShield Life, the ElderShield premiums they have paid will be taken into account in their transition to CareShield Life and their new premiums.

More details on the premiums and government support package for this group will be released later.

Some ElderShield policyholders may choose to remain on their current ElderShield plan, instead of switching to CareShield Life.

Their ElderShield policies will continue to protect them, and the premiums they have paid will continue to be set aside for their future claims.

Lim Siok Peng (Ms)
Director, Corporate Communications

Easing the costs of long-term care needs
Besides subsidy schemes, CareShield Life can also help relieve burden of severe disability
By Joyce Teo, The Straits Times, 5 Jun 2018

A new mandatory insurance plan - CareShield Life - announced last week by the Government is set to ease the burden that severe disability can bring, adding to government and community assistance plans aimed at meeting long-term care needs.

There are at least 10 schemes for long-term care, many administered by the Agency for Integrated Care.

The cost of long-term care should a person be severely disabled is one of two major costs that Singaporeans will face as they live longer and do not have enough babies, said Mr Christopher Tan, chief executive officer of Providend, a financial advisory firm specialising in retirement planning.

The other major cost will be the medical expenses incurred when one gets admitted into a hospital.

Yet, many people do not think much of long-term care insurance, said Mr Alfred Chia, CEO of financial advisory firm SingCapital. "We have seen so many cases where people are hit with disabilities when they least expect it," he said.

"When disability hits, one loses the ability to earn an income while expenses pile up," he added.

Long-term care refers to the personal or health care needed by individuals who are frail or hit by adverse health conditions over an extended period of time.

Most of the help needed by these individuals are with basic day-to-day tasks, sometimes called Activities of Daily Living, such as bathing, feeding or going to the toilet.

Long-term care assistance schemes can also include help to purchase assistive devices such as motorised wheelchairs and hearing aids; and home health items such as catheters and diapers.

Transport subsidies are also available for wheelchair-using seniors who need to travel to a day rehabilitation centre or a dialysis centre; or those who attend a dementia daycare centre.

These come under the Seniors' Mobility and Enabling Fund, which was launched in 2011, enhanced in 2013, and boosted by a $100 million top-up announced in February this year.

Even big items such as ramps for flats are eligible for subsidies under the Enhancement for Active Seniors (EASE) programme by the Housing Board.

In late April, the Government said applications for subsidised ramps for HDB flats with multi-step entrances will open in the second half of the year, enabling elderly wheelchair users to get them to make their homes more accessible. The Government will pay up to 95 per cent of the cost of buying and installing such ramps.

Other subsidised elderly-friendly home fittings such as grab bars or slip-resistant treatment for floor tiles are also included in the EASE scheme, which is offered together with HDB's Home Improvement Programme.

Close to 163,000 households have applied for help under this scheme from its launch in July 2012 to March this year.

Apart from such help, a national long-term care insurance will offer basic protection. From 2020, all Singaporeans who turn 30 will be automatically covered by CareShield Life, which offers lifetime cash payouts of at least $600 a month (albeit with higher premiums) when a successful claim is made, instead of $400 a month for six years under ElderShield.

"The amount itself may not be enough for many people but, for lower-income families, the Government does provide a lot of subsidies. You have to look at it in totality," said Mr Chia.

He said those who can afford it should get their own life insurance, which would offer a lump sum payment if total and permanent disability hits. For better coverage, consumers can look for plans that define such disability as the inability to perform three Activities of Daily Living, he said.

Also, Mr Chia recommends that people set up a Lasting Power of Attorney, which allows them to appoint someone to manage their financial affairs should they lose their mental capacity one day.

"Otherwise, in instances where the person is hit with a severe disability and loses his mental capacity, his caregiver won't be able to access his insurance payouts or savings."

CareShield Life is meant to provide the most basic long-term care coverage sufficient for the lower-middle income group, defined as households with $1,100 per capita household income, said Mr Tan.

Should they become severely disabled and opt for nursing home care that costs $2,400 a month for instance, they can get a 60 per cent government subsidy of $1,400, use their CareShield Life to pay $600 and co-pay the remaining $400 with their savings, he said.

"I think for this group of individuals, CareShield would adequately provide for long-term care. For the higher-income group, they can opt to buy a supplement to improve their coverage," said Mr Tan.

As CareShield Life is meant to gradually replace ElderShield, the first cohort to be put on it will be all Singaporeans and permanent residents aged 30 to 40 in 2020 - including those with pre-existing disabilities.

Most of those beyond age 40 at that time would be existing ElderShield policyholders, who are eligible to join CareShield Life from 2021. The Ministry of Health is expected to release further details on this, such as the premiums, in the next few months.


Apart from ElderShield (and CareShield Life from 2020), Singapore's long-term care needs are supported by a combination of government and community assistance, as well as personal and family savings.

Around two-thirds of households qualify for means-tested government subsidies of up to 75 per cent and 80 per cent for nursing home care and home-and centre-based services respectively.

Current government assistance schemes include:


This provides means-tested subsidies to defray the costs of assistive devices, home health items or transport. It is administered by the Agency For Integrated Care (AIC).


This provides means-tested subsidies to make HDB flats elder-friendly. It is administered by the Housing and Development Board.


Administered by AIC, these help to defray the costs of informal care at home.


Severely disabled Pioneers can get a cash payout of $100 a month for life. It is administered by AIC.


This provides a quarterly cash supplement to the bottom 20 per cent of elderly Singaporeans who had low incomes through life and have little or no family support. Those who qualify will receive the supplement automatically. There is no need to apply.


This offers an annual $200 subsidy to help defray the costs of attending caregiving courses. It is administered by AIC.


Severely disabled seniors who did not qualify for ElderShield when it was launched in 2002, as they were too old or had existing disabilities then, can tap this to pay for their medical bills, nursing costs or domestic help. Administered by AIC, it provides means-tested cash payouts of $150 or $250 a month for up to six years.

** Government refutes text message claims that it is profiting from ElderShield, CareShield Life
By Isabelle Liew, The Straits Times, 3 Jul 2018

The Government has refuted claims made in a text message being circulated on messaging platforms that the ElderShield and CareShield Life health insurance schemes were introduced to reap profits from Singaporeans.

The text message also suggested that because the risk of severe disability is very low, it is unlikely that policyholders will make a claim.

The Government said on its website that it will not profit from CareShield Life. The premiums collected and returns from investments will stay within the fund so that policyholders can benefit through higher payouts or premium rebates.

By 2020, CareShield Life - a national long-term care insurance scheme - will be compulsory for people aged between 30 and 40. After that, Singaporeans will join automatically at the age of 30. CareShield Life offers lifetime cash payouts for those who are severely disabled. Payouts will start at $600 per month in 2020 and increase over time.

"Today, premiums collected under ElderShield are more than the claims paid out, as most policyholders are relatively young," the website said. "However, these premiums collected do not become government surpluses. Rather, they are meant for future claims - when policyholders become older and more of them make claims for severe disabilities."

It also said that as the population ages, half of Singaporeans who are healthy at the age of 65 could go on to become severely disabled.

From 2013 to last year, the annual claims paid out rose by 12 per cent more than the annual premiums collected, which went up by 3 per cent.

"Coupled with shrinking family sizes, it will be challenging to rely solely on personal and family savings to pay for one's long-term care needs," the website said. "While the expected median duration for severely disabled individuals to remain in disability is around four years, three in 10 severely disabled individuals are expected to remain in disability for 10 years or more."

Government subsidies will make CareShield Life more affordable, and premiums can be fully paid by Medisave. If a person cannot pay the premiums, they will not lose coverage.


*** Older Singaporeans will get incentives ranging from $500 to $2,500 to join CareShield Life
By Salma Khalik, Senior Health Correspondent, The Straits Times, 4 Jul 2018

Older Singaporeans will be offered incentives ranging from $500 to $2,500 to join CareShield Life, which provides far better cover than ElderShield, which most people over age 40 are on.

This will help offset premiums that could exceed $1,000 a year for 10 years, before subsidies.

Should disability strike, they will be paid at least $600 a month - for as long as they remain disabled - by the government-run long-term care insurance.

According to the Ministry of Health, half the people who are healthy at the age of 65 can expect to become severely disabled later in life.

Of those who do, three in 10 are expected to live with their disability for more than a decade.

CareShield Life will be compulsory for all Singaporeans and permanent residents aged 40 years and younger when the scheme is launched in 2020. Premiums can be paid using Medisave.Older people are also encouraged to avail themselves of this cover, when it is opened to them a year later, in 2021.

Singaporeans for whom it is optional will get $500 to $2,500 as participation incentive if they join it within two years of its launch. Since the top-up premiums rise with age, greater incentives will be offered to older citizens.

On top of that, the Government will pay 20 per cent to 30 per cent of the top-up premiums for people with per capita household incomes of $2,600 or less, and who live in homes valued at $13,000 or less.

Today, of the two million people aged 40 years and older, two in three are covered by ElderShield, a long-term care insurance offered by three insurers.

Of this cohort, 26 per cent are on the older ElderShield300, which pays $300 a month for up to five years, and 38 per cent are on ElderShield400, which pays $400 for up to six years.

Those who decide to upgrade to CareShield Life - which provides payouts for life - will need to pay top-up premiums to enjoy the expanded coverage.

Although CareShield Life premiums are paid until the age of 67, those in their mid-50s and older who upgrade will be given 10 years to pay the additional premiums.

People aged 39 to 48 now who are on ElderShield400 in 2021 will automatically be switched to CareShield Life. They have till end 2023 to opt out with no penalty.

Older people and those not on ElderShield have to opt in if they want CareShield Life coverage.

There is no age barrier to joining the scheme, though there is no incentive after the first two years, and premiums will be higher for older members.

Health Minister Gan Kim Yong said it might not make sense for everyone to join, especially if they are among the 35 per cent who have bought supplements to ElderShield schemes that offer higher or longer payouts.

This is because people's needs and circumstances differ.

He said that for some, "the incentives and subsidies will be meaningful and helpful", but older people "may find it very difficult to participate".

"It is important for them to take into account their own financial resources and their care needs," he said.

"Some of them may already have their own arrangements on their long-term care needs, and CareShield Life may not be an appropriate option."

Dr Chia Shi Lu, head of the Government Parliamentary Committee for Health, said many older people have told him that they would like to join CareShield Life in spite of the higher premiums.

"Given the many incentives, subsidies and premium support, it would still be affordable for many in the older group," he said.

**** Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

CareShield Life a key pillar of Singapore's social safety net: Health Minister Gan Kim Yong
He highlights need for balance between keeping premiums affordable and payouts sufficient
By Salma Khalik, Senior Health Correspondent, The Straits Times, 11 Jul 2018

As Singapore ages, it is preparing its citizens for the possibility of long years of disability by rolling out CareShield Life, which Health Minister Gan Kim Yong said was "more than just an insurance scheme... it is a key pillar of our social safety net".

Speaking in Parliament on the proposed disability insurance that will be compulsory for people born after 1979, Mr Gan spelt out the rationale and the philosophy behind it.

He said it needs to strike a balance between keeping premiums affordable and the payouts sufficient. Each cohort will pre-fund its own needs and, once on the scheme, no one would lose coverage on account of financial constraints.

While half the people who are healthy at the age of 65 would be struck with severe disability at some point after that, preparing for this is not "a natural priority" for most people, said Mr Gan.

The problem is, when disability strikes, one does not know how long it would last. He said: "If we save for four years of disability, but remain disabled for 10 years, we would not have saved enough. If we save for 10 years, but we have been disabled for less, we would have over-saved."

By pooling risks, CareShield Life would smooth over such uncertainties and support the long-term needs of each cohort, with a payout of at least $600 a month for life if one is severely disabled.

Some 19 MPs joined the debate, with many questioning why women had to pay higher premiums and whether the scheme could help less severely disabled people. They also asked how the premiums and payouts were calculated.

Workers' Party chief Pritam Singh (Aljunied GRC) spoke of social media spreading misinformation about the scheme. People had suggested that the Government was using it to make money.

Mr Gan assured that premiums will go into a fund that will be "ring-fenced" for CareShield Life needs. It will be audited annually to ensure all monies are accounted for.

He said: "All premiums collected and any returns from investments will remain entirely within the fund and used solely for the benefit of policyholders."

Senior Minister of State for Health Amy Khor explained why women must pay higher premiums. Of those who were healthy at 65, three in five women would become severely disabled, compared with two in five men. "Women are also more likely to remain in disability for a longer time than men," she said. So, women paying higher premiums "accurately reflects the differences in risks".

Dr Khor also announced that the Government will inject $100 million into the insurance scheme to offset the cost of including those with disabilities, who can start collecting payouts immediately.

Senior Minister of State Chee Hong Tat, who was handling CareShield Life before he moved to the Trade and Industry and Education ministries in May, explained why the payouts were meant only for the severely disabled.

Premiums would jump by a third if the payouts were extended to those unable to do two - rather than three - activities of daily living. They would jump by another third if the payouts were to start at $800 a month, instead of $600, in 2020.

He said it was a matter of tradeoffs - being more generous in payouts against the need to keep premiums affordable.

To MPs who asked for greater transparency in how premiums and payouts were calculated, he said it was "very complex", and that he will discuss with experts "how best to share the information".

Wrapping up the debate of more than five hours, Mr Gan said CareShield Life will not be the only source of funding long-term care.

He said: "Personal and family savings, other government subsidies and safety nets and community support also play a role."

Some MPs against higher premiums for women
By Salma Khalik, Senior Health Correspondent, The Straits Times, 11 Jul 2018

A dozen MPs out of the 19 who spoke on the proposed CareShield Life long-term care insurance opposed the fact that women would pay higher premiums than men.

The Ministry of Health (MOH) had explained previously that the premiums are derived actuarially, since women live longer and are expected to suffer from disabilities for longer.

Dr Chia Shi-Lu, head of the Government Parliamentary Committee (GPC) for Health, led the charge, saying the GPC recognises the basis for higher premiums, "but would like to repeat our call that the gender differentiation be removed".

Non-Constituency MP Daniel Goh of the Workers' Party (WP) said he found it "objectionable that women are being penalised for something that is not within their control".

WP MP Pritam Singh (Aljunied GRC) said he strongly supported gender neutrality. "It will mean that men will pay more and women less. Let it be so."

Mr Zainal Sapari (Pasir Ris-Punggol GRC) said his wife lamented that the scheme, touted as being inclusive, "is selective inclusivity".

Mr Saktiandi Supaat (Bishan-Toa Payoh GRC) said he was sure all men in the Chamber, and in Singapore, would not object to more support for women.

Among the women MPs, Dr Lily Neo (Jalan Besar GRC) said: "While I can understand that women live longer, I feel that there can be better inclusiveness and fairness."

Allowing the disabled to join the compulsory scheme for those born in or after 1980 and to receive payouts immediately "reflects the inclusive society that we aspire to build".

"But I am saddened that this idea of inclusive society does not extend to gender equality," she said.

Nominated MP K. Thanaletchimi said there is already a "gender wage gap of 19 per cent to 40 per cent in some industries".

She asked: "Could the Government look into either reducing the difference in premiums or provide greater financial support so that women are not doubly penalised?"

Ms Jessica Tan (East Coast GRC) said given that the scheme is compulsory, it is only right that premiums should disregard gender.

Senior Minister of State for Health Amy Khor, in reply, said it was a difficult decision for both the review committee and her colleagues in the ministry to make.

But the decision is actuarially sound because women's life expectancy is 85.2 years, and men's 80.7 years. Disability is more likely to take place in the older years.

Two local studies also showed that, at age 60, women can expect 7.8 years needing some assistance, compared to 2.6 years for men.

In the United States, two-thirds of long-term insurance claims were paid to women in 2012.

Dr Khor pointed out that under the current ElderShield insurance, women are already paying higher premiums.

She added that should the premiums be the same for men and women, it might lead to "adverse selection" among the two million people who were born before 1980 for whom the scheme is optional.

Men who realise they need to pay more than actuarially called for may not join CareShield Life.

She added: "We note the issue about women having less savings in Medisave. We think that it is prudent to determine the premiums correctly, and then look at different ways to help the women."

Higher payouts? Premiums will jump, says Chee Hong Tat
By Linette Lai, Health Correspondent, The Straits Times, 11 Jul 2018

The premiums of CareShield Life for long-term care could be more than two-thirds higher if payouts are increased and claims criteria relaxed, Mr Chee Hong Tat, Senior Minister of State for Trade and Industry and Education, said yesterday.

Mr Chee, who has been handling CareShield Life even when he was with the Health Ministry until April this year, was responding to MPs' questions on the adequacy of the new national disability insurance scheme, which is to be introduced in 2020.

Under CareShield Life, monthly payouts will start at $600 and, with premiums, increase over time. The payouts are given for as long as the claimant is severely disabled.

In contrast, the existing ElderShield scheme provides for a maximum $400 monthly payout which stops after six years.

Several MPs, however, pointed out that CareShield Life payouts may be insufficient, especially after inflation is taken into account.

Others also want the Government to let the moderately disabled start claiming from the scheme as well. Currently, only those who cannot carry out three of the six activities of daily living (ADLs) on their own can make claims from ElderShield.

The six tasks are washing, dressing, using the toilet, feeding oneself, moving around indoors and getting from the bed to a chair or vice versa.

"By the time a person is unable to do three ADLs, (they) are in dire straits. One is either headed towards a nursing home or needs someone to provide care full-time," said Workers' Party (WP) MP Sylvia Lim (Aljunied GRC), who called for the criterion to be reviewed before implementing CareShield Life.

"Before that stage, if CareShield Life can give some payouts, then it is likely that the disabled person can continue to be looked after at home with some part-time help."

Dr Lily Neo (Jalan Besar GRC) added that a person who needs help with two ADLs would typically need full-time help.

"While I understand that keeping CareShield Life premiums affordable is necessary, the adequacy and usefulness of CareShield Life are just as important," said Dr Neo, a medical doctor.

She added that the $600 monthly payout is inadequate for families to hire a maid, let alone pay for other healthcare expenses such as medical equipment and services.

Mr Chee said the ElderShield Review Committee discussed the tradeoffs between benefits and affordability before deciding on the final amounts.

"If we raise the payout from $600 to $800 a month, premiums for a 30-year-old male in 2020 could increase by about one-third," Mr Chee said.

Loosening the claims criteria to let those who cannot carry out two, rather than three, basic activities would increase premiums by another third.

And if payouts were allowed to increase for life after a claim is made, premiums will again increase by a third, he said.

MPs and Nominated MPs also called for more transparency on CareShield Life, asking the Government for details on the actuarial aspects of the scheme.

"Could we have raw data and assumptions in actuarial computations made available to industry and academics so that the transparency of the computations can be made clear to all?" asked NMP Chia Yong Yong.

Several WP MPs, including party chief Pritam Singh, also asked the Health Ministry to explain how it arrived at its estimate that one in two Singaporeans will become severely disabled in their lifetime.

"This factor... has raised some eyebrows, leading people to enquire whether it is unrealistically dire, legitimising higher and earlier premium payments," he said.

CareShield Life balances inclusivity and long-term sustainability

We refer to The Straits Times editorial (CareShield Life: Give women fairer deal; July 14) and commentary (Three niggling questions about CareShield Life; July 19).

The ElderShield Review Committee debated the issue of gender-differentiated premiums extensively.

Women live longer and are more likely to experience severe disability. They will claim more from long-term care insurance and, hence, it is actuarially sound for premiums for women to be higher.

We heard diverse views at our focus group discussions, where participants were given information about differences in life expectancy and disability incidence between genders.

Some Singaporeans - both women and men - felt that it was fair for premiums to be higher for women. Others felt that premiums for an inclusive scheme should be gender-neutral.

In our deliberations, we considered other implications of making CareShield Life premiums gender-neutral.

CareShield Life will be optional for some two million Singaporeans born in 1979 or earlier. Two-thirds of them have ElderShield, with gender-differentiated premiums.

Gender-neutral premiums will make CareShield Life less attractive for male ElderShield policyholders, as premiums for ElderShield supplements are gender-differentiated. CareShield Life could eventually end up with a profile of mostly female policyholders, pushing up premiums further.

Schemes like the Affordable Care Act in the US and MediShield Life cover medical expenses and annual premiums are paid for life, so they are not apple-for-apple comparisons with CareShield Life.

Women generally pay more years of premiums as they live longer. On the contrary, women and men pay premiums over the same duration for CareShield Life; hence annual premiums for women are higher.

Inclusivity was a key goal for our committee.

We recommended strongly for CareShield Life to protect future generations of Singaporeans with pre-existing disabilities, and urged the Government to provide premium subsidies.

We are glad that premium subsidies are designed as a percentage of premiums payable, so women will receive more support in dollar terms. Allowing family members to use their Medisave to pay their loved ones' premiums also encourages family support.

Overall, we felt that gender-differentiated premiums with percentage-based subsidies, would strike a good balance between inclusivity and long-term sustainability.

We are mindful of the concerns that women may have less savings, and we hope that the Government will continue to explore ways to support women with their premiums.

Chan Chia Lin (Ms)
Director, Holywell
Member, ElderShield Review Committee
ST Forum, 21 Jul 2018


ElderShield Review Committee Report 25 May 2018 -pdf file

New CareShield Life Scheme: Higher & Lifetime Payouts, with Government Subsidies -27 May 2018

ElderShield review committee proposes severe disability insurance scheme be made compulsory with coverage starting from age 30 instead of 40

Government to Strengthen Long-term Care Financing for All Singaporeans -3 Jul 2018

Opening Speech by Mr Gan Kim Yong, Minister for Health, for the Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

Closing speech by Mr Gan Kim Yong, Minister for Health, for the Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

Speech by Dr Amy Khor, Senior Minister of State, Ministry of Health, for the Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

Speech by Mr Chee Hong Tat, Senior Minister of State, Minstry of Trade and Industry & Ministry of Education, for the Parliamentary Debate on ElderShield Review Committee Report, 10 July 2018

CareShield Life Premium Calculator: Ministry of Health launches online tool to calculate premiums for disability insurance scheme to be launched in 2020

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