Over the last four years, there is a 30% increase in the number of claimants. At the same time, annual payouts have increased by about 40%.
Two-thirds of the premium increases will go to meet this growth in utilisation and payouts.
2. BETTER COVERAGE AND PROTECTION AGAINST LARGE HOSPITAL BILLS
One-quarter of the premium increases comes from refreshing the claim limits. This is to ensure that Singaporeans remain adequately covered for the majority of subsidised bills.
3. ENHANCEMENT TO MEDISHIELD LIFE
Theremaining portion of the premium increases goes to supportthe benefits enhancement to the MediShield Lifescheme. This includes the extension of coverage to inpatient hospices, serious pregnancy complications and treatments arising from attempted suicide, intentional self-injury, drug addiction and alcoholism etc.
BETWEEN 2016 AND 2019
Premiums collected between 2016 and 2019 amounted to of $7.5 billion in total.
In the same period, payouts in claims made up a total of $3.5 billion while $3 billion was set aside for future premium rebates.
The Incurred Loss Ratio (ILR) of theFund was an average of 104% over the period from 2016 to 2019 according to Dr Koh.
This means that the total premiums collected was slightly less than the total monies required to ensure that theFund is able to meet current claims and future commitments.
MEDISHIELD LIFE FUND
For MediShield LifeFund to be able to meet its obligations to policyholders, it has to remain solvent and sustainable.
Premiums collected have to cover potential current and future payouts, including amounts set aside to supportfuture commitments as well as provide a buffer against unforeseen contingencies such as unexpected spikes in hospitalizations due to disease outbreaks.
PREMIUMS SET ASIDE FOR FUTURE COMMITMENTS
As policy holders age, claims are likely to increase and so will premiums.
Part of the premiums paid by policyholders during their working ages are set aside to provide for future premium rebates. This constitutes the bulk of future commitments set aside in thereserves. It will help to moderate premium increases in their old ages. Other commitments include future payouts for diseases currently under treatment that will require multi-year care, such as renal failure and cancer.
“However, it was important that MediShield Life remains solvent and sustainable so that it can meet its obligations in time to come when policyholders make claims. Its coverage also has to be updated and enhanced to remain relevant to the healthcare needs of Singaporeans,” he said.