By Salma Khalik, Senior Health
Correspondent
IS MEDISHIELD Life the best way ahead
for Singapore health care?
MediShield, the current national health
insurance scheme, stops covering people when they turn 90.
That means more than 10,000 people aged
90 and older have no medical insurance, even though the older you are, the more
health care you need.
Coupled with the fact that Singaporeans
are living longer, the Government will end up supporting a rising number of
elderly folk who have run out of money to pay for their health-care costs.
Some countries do just that, but the
rising burden eats heavily into government expenditure and that usually results
in higher taxes for the working population.
Singapore has decided to go a different
route with MediShield Life, which will be launched next year. It will cover
everyone, even those with pre-existing diseases, for the rest of their lives.
By doing this, the burden is shared
among society as a whole as well as the individual patient.
The Government provides heavy hospital
subsidies, society pays the bulk of the remaining bill through insurance
premiums while the individual patient is responsible for the deductible and
co-payment.
The deductible is the initial amount of
a bill the patient has to pay before insurance kicks in. Under the basic
MediShield plan, patients also have to pay a portion of the bill - currently
between 10 and 20 per cent - beyond the deductible.
How is having compulsory insurance for
all different from levying heavier taxes to pay for health care? With taxes,
only the working population and richer individuals pay. With insurance,
everyone contributes.
The Government uses taxes to provide
subsidies that cover as much as 80 per cent of a hospital bill, after which the
bulk of the remaining cost is spread among the population. This is very much
like the goods and services tax which each person pays when he buys something,
rather than income tax which is paid according to how much a person earns.
Patients still have to pay part of the
bill, and this makes it fairer. The person needing treatment pays a larger part
of the tab in the form of the deductible and co-payment. Those who keep healthy
and out of hospital pay only the annual premiums.
Another reason for introducing
MediShield Life is that more than 90 per cent of Singaporeans are already
covered by MediShield. So it is practical to expand the existing system rather
than launch a totally new scheme.
But covering the other 8 per cent of
the population will not be easy. This group includes those who are at higher
risk of severe illness requiring hospitalisation or the elderly who might need
frequent hospitalisation.
People who have been doing the right
thing by signing onto the insurance scheme while they are young and healthy,
and paying premiums for many years without making any claims, should not end up
being the ones paying for this 8 per cent.
Still, the elderly and those who
already are sick cannot be made to pay so much that it will prove too big a
burden or make little sense for these latecomers.
A Review Committee, which is looking
into how MediShield Life should be structured, will need to decide if everyone
should pay a standard premium or if it should vary depending on whether the
person has pre-existing illnesses.
It will be a tough choice.
Grouping the healthy with the unhealthy
would be unfair to those who are well. But penalising those who are already
sick will also be difficult, especially since they will have various illnesses
with very different health risks.
Trying to separate those who are less
sick from their more sick counterparts will be a massive exercise which could
be more costly than beneficial.
However, once all that is ironed out,
the scheme should be fairly robust. Younger people will pay more, with the
money offsetting the expected higher premiums as they age.
This is the fourth of 12 primers on
various current affairs issues, published in the run-up to The Straits
Times-Ministry of Education National Current Affairs Quiz.
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