Saturday, May 30, 2015

With Medishield Life Coming, Is Integrated Plan Still Necessary?

Just the other day, had a group chat with a bunch of peer financial bloggers and one of the topic that we briefly discussed is about the upcoming Medishield Life launch. Apparently, it seems like many of the public are still quite hazy about Medishield Life and what's in it for them! It is understandable as it is kind of a complicated scheme. 

Without going into too much of the details, on the high level, you just need to know that Medishield Life is :

1. A revamp of the existing Medishield scheme with enhanced benefits/coverage (with higher premium, of course). It is administered by CPF Board. 
2. A compulsory national Medical Insurance scheme which cater to cover up to Class B2 Ward, Restructured Hospitals (5-6 bedded shared room). 
3. You can pay all your Medishield Life premium using your Medisave amount.
4. It covers all illness/condition (whether pre-existing or not).
5. It can be integrated with the Integrated Plan (provided by selected insurers*) for better coverage/benefit.
6. Going to be launched by End 2015 (actual launch date has not been confirmed yet) and during the transition period i.e. next couple of years, varies subsidies will be provided by the Government to lessen the impact of the premium increase. 
7. If you are deemed to have pre-existing condition/illness that fall under CPF Board/MOH's definition, there will be a standard premium loading of 30%. Good news is it can be paid via Medisave too (A notification from MOH will be sent out to the identified insured in later part of Q3 2015).

Since Medishield Life is a compulsory scheme, whether you like it or not, you will be in it automatically! So, there is nothing much that we need to debate about. What I would like to share more in this post is this : With the Medishield Life, is the Integrated Plan still necessary? 

Of course, the politically correct answer is "YES and NO". Why? Because everyone's needs are different and you need to decide for yourself (or your loved ones) whether you really need the add-on coverage or not. If you have difficulty in making the decision, maybe you can start with the following self-questioning :

1. Can I afford the premium in the long run? Integrated Plan is age-band rated (i.e. the premium will increase alongside your age), even though we can pay the Integrated Plan via Medisave but there is a cap per year, it's called Annual Withdrawal Limit (the cap amount is still not finalised yet), hence, potentially you need to fork out some cash when you are older (i.e. when the Integrated Plan's premium is more than the Annual Medisave Withdrawal Limit). 

2. Do I intend to stay in the higher class of Wards (i.e. B1 and beyond) or even Private Hospital? If the answer is YES, then Medishield Life coverage might not be sufficient to cover the expenses as the benefits will be pegged at the Class B2 Ward. Of course, this is really a personal choice, with our healthcare standard (which is quite high among the region), Class B2 ward might be sufficient for most of us.   

3. Do I usually choose the doctor (to attend to me) when I got admitted? If the answer is YES, then Medishield Life coverage might not be sufficient for you as you can't choose your preferred doctor in Class B2 ward.

4. Do I need the Letter Of Guarantee (LOG) facility? LOG is the facility provided by selected Integrated Plans to waive the deposit upon admission to hospitals. Do take note that by issuing the LOG, it doesn't means that your claim will be guaranteed payable, it is just a form of "credit term/assurance" provided by selected insures to the hospitals to waive the deposit.  

Two more things to highlight if you are considering the Integrated Plan:
1. Even though Medishield Life covers for all illness/conditions but the Integrated Plan might exclude you for certain conditions (Underwriting guidelines between the private insurers and the CPF Board are different). If you accepted the term, for such scenario (i.e. if you admission is due to the excluded condition by the insurer), you will be entitle to the Medishield Life claimable amount only. 

2. All the insurers* do provide Rider(s) Benefits you can attach to your Integrated Plan (with additional premium, of course). They are basically anther layer of add-on coverage/benefit to supplement the overall benefits.    

I hope this post provides some enlightenment to some of you folks. If you have any question related to Medishield Life, feel free to raise them in the comment section and I will try my best to answer them within my capacity. 


*5 insurers that currently providing the Integrated Shield Plans are :
AIA (HealthShield)
Aviva (MyShield)
Great Eastern (SupremeHealth)
NTUC Income (INcomeShield)
Prudential (PruShield)  

P/S: Please be reminded that you need to confirm your household composite by 19/06/2015 (Fri), for more details, click here.


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