MEDISHIELD Life claim limits and premiums will rise from April 2025 in response to rising healthcare costs, with the government providing S$4.1 billion in subsidies and MediSave top-ups over three years to cushion the impact.
The changes, based on recommendations from the MediShield Life Council that were accepted by the government, aim to address mounting healthcare costs.
Key changes at a glance
The policy year claim limit will be raised from S$150,000 to S$200,000.
Daily claim limits for normal ward stays will increase from S$1,000 to S$1,630 for the first two days; intensive care unit claim limits will more than double, from S$2,200 to S$5,140 a day.
Outpatient coverage will also be enhanced. For instance, claim limits for kidney dialysis will go up from S$1,100 to S$1,750 a month. And coverage will expand to include new outpatient treatments, such as repetitive transcranial magnetic stimulation for depression, as well as home-based medical care.
Additionally, coverage will be expanded to include high-cost treatments that are both “clinically effective and cost-effective”. These include cell, tissue and gene therapy products (CTGTPs) for serious conditions such as cancer, as well as high-cost drugs for blood disorders and conditions with childhood onset.
To fund these enhancements, MediShield Life premiums will rise by a total of S$1.8 billion over the next three years.
In response, the government will offer S$4.1 billion in assistance, comprising S$3.4 billion in MediSave top-ups, and S$700 million in premium subsidies.
The support measures are expected to more than offset premium increases for more than 90 per cent of Singaporeans in the next three years, the Ministry of Health (MOH) said on Tuesday (Oct 15).
“The package far exceeds the increase in premiums. Therefore, we are taking this opportunity to also build up the MediSave balances for Singaporeans,” said Health Minister Ong Ye Kung in an interview with the media before the announcement.
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To sieve out smaller, more affordable bills that can be covered by MediSave, the inpatient deductible for C-class ward stays will go up in two phases – once in April 2025, and again in April 2027 – by up to S$1,500.
From Jan 1, 2026, a new annual outpatient deductible of S$500 will be introduced. A deductible is the amount a patient must pay in each policy year before MediShield Life begins paying out.
Additionally, the proration factor for private, unsubsidised bills will be lowered – with some exceptions – meaning that policyholders opting for private care will generally have to pay more.
The proration factor adjusts claims for unsubsidised treatments to subsidised care levels, ensuring comparable payouts regardless of hospital or ward choice.
Premium caps
With the expansion of coverage and higher claims, MediShield Life premiums will need to rise, with older Singaporeans facing larger increases, said MOH.
To manage this impact, the total premium increase will be capped at 35 per cent and phased in evenly over three years, from April 2025 to March 2028.
This phased increase will be supported by a one-time release of S$600 million from the MediShield Life Fund – the first time such a release has been made.
As at Dec 31, 2023, the MediShield Life Fund held S$14.2 billion in assets, based on the Central Provident Fund’s latest financial statements.
Eroded coverage
Introduced in 2015, MediShield Life is Singapore’s national health insurance scheme, designed to help citizens and permanent residents cover large hospital bills and selected outpatient treatments.
Originally intended to cover nine in 10 subsidised bills, this coverage has dropped to just under eight in 10, due to rising medical costs.
The enhanced claim limits are expected to restore coverage to nine in 10 bills, said MOH.
The last MediShield Life review in 2020 resulted in an average premium increase of 25 per cent.
Reviews are typically held every three years; the latest one was done by the 11-member MediShield Life Council, chaired by former Nominated Member of Parliament Fang Ai Lian.
The health minister also said the latest adjustments will also help patients cope with rising outpatient costs, such as kidney dialysis.
“If nothing is done, it’s (only) a matter of time before kidney dialysis patients come out of their own pocket and pay cash for dialysis,” he said.
Ong also highlighted the need to address the rising costs of advanced medical treatments such as CTGTPs.
These breakthrough therapies, while expensive, offer the potential to cure severe diseases such as cancer, he said. “If we do nothing, chances are, in time, only the rich can access such treatments.”
