Insurers to get all patients to pay part of hospital bills to help address over-consumption of medical services

Anyone buying a new rider will need to pay at least 5 per cent of his hospital bill

Gear up for this, folks: The days of getting insurers to pay the full sum of your medical bills are drawing to an end.

Yes, you heard right. This is because six companies selling MediShield Life-linked health insurance have appealed to the Ministry of Health (MOH) to make it compulsory for existing as well as new policyholders to pay part of their hospital bills, even if they buy riders that now cover the entire amount.

Be informed that the $3,000 cap applies only if patients are treated by doctors on the insurer’s approved panel, or had received prior approval from the insurer. Otherwise, they still have to pay the 5 per cent, but there will be no cap on how much they need to pay each year.

All six IP insurers claimed that they had faced underwriting losses in 2016. But Mr Chee made it clear that the ministry’s move is not due to this.

He said: “Let me be clear that MOH is not issuing these requirements to bail out the insurers. Our objective is to address the concerns with over-consumption, over-servicing and over-charging.”

Senior Minister of State for Health Chee Hong Tat announced on 7th March 2018 that patients must bear a minimum 5 per cent co-payment for new Integrated Shield Plan riders.

New riders will have a cap on the co-payment amount each year, with most insurers planning new riders with an annual cap of S$3,000.

This places an upper limit on the risk exposure for policyholders, to protect them against very large bills, Mr Chee said during his ministry’s Committee of Supply debate.

The changes in requirements will affect those who will pay for what is known as “full riders”, on top of Integrated Shield Plans. Such riders cover the entire co-payment amount, so the policyholder ends up paying nothing regardless of the bill size.

Currently, about 29 per cent of Singapore residents have these full riders, Mr Chee added.

New riders will be available within a year.

Meanwhile, insurers can continue selling their existing rider plans, but must inform new policyholders that they will transit to the new riders with co-payment from 1 April 2021.

MOH will issue the requirements for all new rider plans with immediate effect, in line with the Health Insurance Task Force’s recommendations, he added.

Once the new riders are ready, policyholders can choose to switch to the new riders earlier if they wish to do so, and any pre-existing conditions that are covered prior to the switch will not be excluded.

“We expect the new riders to have lower premiums than full riders, so the switch will result in premium savings for policyholders,” Mr Chee said, adding that if insurers intend to make changes to existing policies, they should “consider the interest and well-being of all policyholders, as they seek to keep premiums affordable for everyone in the longer term.”


He stressed that MOH is not issuing these requirements to “bail out” the insurers.

The zero co-payment feature of these full riders has resulted in a “buffet syndrome”, leading to over-consumption, over-servicing and over-charging of healthcare services, he said.

“Our objective is to address the concerns with over-consumption, over-servicing and over-charging, as these will lead to patients and policyholders paying rapidly escalating fees and premiums over time,” he said.

Mr Chee gave some of the examples of over-consumption and over-servicing, which he described as “disturbing”.

In one case, a full rider policyholder made claims for 12 nose scopes in a year, without clear medical need, and another policyholder who underwent an expensive surgery for a small breast lump removal that cost S$70,000 in doctor fees alone, when there was another identical and effective alternative procedure at S$5,000.

There have also been patients who were admitted for gastritis or piles, and then referred to many other specialities ranging from dermatology, ophthalmology and ear nose and throat, for additional scans and tests racking up to S$25,000 for a hospital stay in less than 24 hours, he said.

“It is clear that full riders have a detrimental impact on overall healthcare costs in Singapore. This is a key reason why rider premiums have increased by up to 225 per cent over the past two years,” he said.

The Health Insurance Task Force noted that patients who did not have to fork out money for their medical treatment often racked up large bills at private hospitals.

On the contrary, insurers have been bombarded with questionable claims from patients with riders who were treated in private hospitals, The Straits Times has discovered. Here is a sampling:

• A 37-year-old woman stayed seven days in hospital for abdominal hernia repair. Of the $46,000 bill, the surgeon’s share was $31,900, or five times the norm. It transpired that while in hospital, she also had her breast augmented, and a tummy tuck with the fat transferred to her buttocks, but since these are not covered by insurance, none of this was stated in the bill.

• Another patient who needed cataract surgery opted to be admitted to hospital, instead of having it done as a day procedure, which would have taken no more than an hour or so. His one-day stay each time for each eye amounted to a total bill of $21,000. The median private hospital bill for cataract surgery of one eye is $5,000.

• A patient with fungal growth in her nail stubbed her toe, causing the nail to fall out. She was admitted for two days and was billed $6,000.

• A patient complaining of stomach and chest pains was admitted to hospital, and underwent gastroscopy and colonoscopy procedures to check his stomach and intestines. He was also referred to a heart doctor, a dermatologist for skin rash and an ophthalmologist for blurred vision. The total bill for his one-day stay was $14,000.

• A patient was admitted for 16 hours for inflammation of the gall bladder. The tests showed no inflammation and no treatment was needed. However, the patient was given a series of unrelated screening tests, including an electrocardiogram, a magnetic resonance imaging scan and a computerised tomography scan. Screening is not covered by insurance. The bill came to $11,000.

• A woman was warded for 42 days for cervical sprain and strain (or pain in the neck) but received treatment only on seven days. She was given physiotherapy and painkillers for the other 35 days, something that could have been done as outpatient treatment. The bill was $84,000.

• A 40-year-old man was warded for four days for pain and swelling in his big toe, chalking up a bill of close to $6,000. The bill was rejected after the insurer checked with the doctor, who said the patient was admitted at his own request and that the treatment would otherwise normally be done in the clinic.


In 2016, the average medical bill size for full rider policyholders was about 60 per cent higher than the average bill size for those without riders, even though rider policyholders are younger and generally in better health, Mr Chee added.

He warned that the negative impact of the zero co-payment feature extends beyond full rider policyholders.

Over the last two years, Integrated Shield Plan premiums had risen by up to 80 per cent, with older policyholders and those on private hospital plans experiencing higher increases.

Over-consumption, over-servicing and over-charging of healthcare services will lead to faster and larger increases in overall healthcare expenditure, he said.

“These increases will ultimately be borne by all Singaporeans through higher medical fees, insurance premiums and taxes, which all of us will have to pay directly or indirectly,” he said.

Senior Minister of State for Health, Dr Lam Pin Min, said the Government has been studying “a slew of measures” for many years, and the initiatives are not targeted at consumers alone.

“We’re also looking at the way doctors charge. Therefore, the Fee Benchmark Committee has been formed, to come up with recommendations for fair and reasonable charging.

“At the same time, we’re also looking at other measures, like appropriate care guides to be issued to healthcare professionals, and looking at the government level how we can improve productivity, efficiency, so that we can manage the rising healthcare costs.”

Dr Lam gave full assurance that the Government is looking into the issue of appropriate charging by healthcare providers.

With the co-payment feature on new IP riders has been officially mandated, Dr Lam believes doctors will be mindful of what tests they prescribe for patients, he said.

Some 1.3 million people out of the 2.7 million covered by private Integrated Shield Plans (IPs) have riders that guarantee they pay very little or nothing towards their hospital bills. IPs incorporate MediShield Life – which covers subsidised treatment – but offer coverage for higher classes of care.

Health Minister Gan Kim Yong told Parliament during the debate on his ministry’s budget that co-payment is an integral part of healthcare schemes since zero payment “dilutes the personal responsibility to choose appropriate and necessary care”.

It would “encourage unnecessary treatment, leading to rising healthcare costs not only for those with such riders, but for all of us,” he said.

People with full riders have bills that are 60 per cent higher than those without riders. In 2016, bills from patients with private hospital IPs and full riders averaged $9,975, compared to $6,270 for those with the same IP but no rider.

Roughly one in three people here have only basic MediShield Life, a third have just IPs and another third have IPs and riders. But riders are getting popular with about 100,000 new riders sold a year.

Elaborating on the scheme, Senior Minister of State for Health Chee Hong Tat said: “Any pre-existing conditions that are covered prior to the switch will not be excluded.”

This should also apply to people currently with full riders who want to switch to the new scheme to save money. Said Mr Chee: “We expect the new riders to have lower premiums than full riders, so the switch will result in premium savings for policyholders.”

As for those who already have riders, Mr Chee said: “We recognise that existing rider policies are commercial contracts between insurers and their policy holders.

“If insurers intend to make changes to their existing policies, they should consider the interest and well-being of all policy holders , as they seek to keep premiums affordable for everyone in the longer term.”