Offer window period for uninsured to join Medishield

Printed in Straits Times Forum Page, 14 September 2009

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Forum Page
Straits Times

When Medishield was introduced more than two decades ago, the Government decided to cover CPF contributors only and give the right for members to opt-out of the scheme. Some members opted out as they were already covered by their employer or for other reasons. Many other people were not covered under Medishield as they do not have a CPF account at that time, for example, they were not working or self-employed.

Today, there are many people who are not covered by Medishield. They are allowed to join Medishield but are subject to underwriting. If they are not in good health, they may be rejected or have exclusions imposed on them.

As many years have passed since Medishield was first launched, it is time to review the need for underwriting requirement for Medishield. I suggest the following measures:

a) Have a window period to allow those not insured to join Medishield on special terms. They are not subject to underwriting but will have existing illnesses excluded or partially covered for a period of two years. These illnesses will be fully covered after the two year period. The excluded illnesses will be of a serious nature and will be defined clearly.

b) Identify the non-insured people, approach them and have an easy way for them to join Medishield. The people to be approached are those with a Medisave account, who is not covered under a Medishield plan.

c) Make it compulsory and automatic for all new-born babies to be covered under Medishield.

It is important to have every resident covered under Medishield, so that they will not be bankrupted by the high cost of major medical expenses. As Medishield is a national scheme, it can be made easily available to all eligible people, without the need for the meticulous underwriting measures that are adopted by commercial insurers. The risk of adverse selection and moral hazard is already reduced by the imposition of a deductible that has to be paid first by the insured.

We have read about the debate in USA about reforming their health care system and the need to offer coverage to more than 30 million uninsured people.

We have a similar problem in Singapore, although on a smaller scale. We have to act early and offer coverage to our own uninsured people.

Tan Kin Lian