Martin Lee @ Sg
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Case Study of an Unplanned Hospitalisation Financial Disaster

Patrick (not his real name) suffered some discomfort late at night. As the normal clinics were already closed, he went by himself to a private hospital to seek consultation.

While waiting for the test results, Patrick collapsed and went into a coma. His condition worsened and he ended up having multiple organ failure. Four specialists (including one anaesthetist) had to be put on standby to stabilize his condition. Patrick also had to be connected to a life support machine in ICU just to keep him alive.

medical-insuranceEven though Patrick was fairly well off, this unexpected incident had lead to a financial disaster for his family due to a number of factors:

1) Patrick only had a private shield plan that covered him only up to A ward in a government hospital, so he can only claim 65% of the private hospital bill from his insurance. The original bill is a whopping $12,000 a day so the uninsured portion works out to be about $4200 a day. There is also an annual limit of $250,000 for his current insurance plan. Transferring him to a government hospital is out of the question due to his condition.

2) As his insurance plan is on a reimbursement basis, his family had to fork out money to pay for the bill first. The hospital requires his family members to make payment whenever the outstanding bill hits $20,000, which is once every two days.

3) Patrick keeps most of his money in single bank accounts and did not give any supplementary credit cards to his wife, so his non-working wife did not have the funds to pay.

4) Patrick is in a coma, so he is unable to sign the Medisave Authorisation Form to allow the CPF Board to pay the hospital bill from his own Medisave Account. This is one of the shortcomings about our current system. However, his family members would be allowed to use their Medisave to pay for the bill. Even so, the Medisave would probably be depleted in no time looking at the size of the bill.

What lessons can we draw from this incident?

1) Ensure your current medical insurance plan fits your needs and make sure your family members know what kind of hospitals and wards you are covered for.

2) Keep some joint bank accounts with emergency cash – with your spouse if you are married and with your parents if you are single. Supplementary credit cards can also be useful.

3) Consider signing the Advance Medical Directive. (AMD) The AMD is a legal document you sign in advance to inform your doctor that you do not want the use of any life-sustaining treatment to be used to prolong your life in the event you become terminally ill and unconscious and where death is imminent.

And in case you were wondering what led to Patrick’s collapse, it was gall bladder infection which resulted in Septicemia.

Read part 2 here:

http://www.martinlee.sg/case-study-of-an-unplanned-hospitalisation-financial-disaster-part-2/

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13 comments
Case Study of an Unplanned Hospitalisation Financial Disaster Part 2 says 8 years ago

[…] I wanted to give a short update on the previous real life story I shared about an unplanned hospitalisation financial disaster. […]

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Wilfred Ling says 8 years ago

If Patrick has a Lasting Power of Attorney, his family member will be allowed to withdraw his personal savings or even sell his assets to foot the bill and the family wouldn’t be so stressed.

Financial advisers and insurance sales people will not advice on the Lasting Power of Attorney because there is no commission to earn. That is why, people who wants to do financial planning should only engage professional planners to do it.

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Jasmin says 8 years ago

I think the hospital is likely to treat the patient and eventually he passes on, the family will have to settle that big “bomb”.
Now before a person is hospitalised, he is asked to sign CPF medisave authorisation form or make a deposit FIRST, to ensure the hospital will get some $$ before anything is carried out.

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Wilfred says 8 years ago

Garrett,

NTUC’s Letter of Guarantee is merely a credit facility. It’s credit limit is just $10,000. Not even enough for 1 day’s worth of fees.

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Gracie says 8 years ago

Same sentiments as Garrett, im also curious what the hospital will do in the event the family is unable to foot the hospital bills.. I’ve seen hospital staff advising patients to raise the money before going back for radiotherapy treatment (in other words, no money no talk). I guess the same applies for chemo but in this case, it’s coma.. hmm.. will the hospital be humane enough to treat the patient or will it send the patient away to free up bed space?

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Elite says 8 years ago

our elite leaders can surely afford it. Can stay a year or ten years also no problem. Can retrofit a boeing jet to be the hospital bed also no problem. If one of them is in that situation, you can be sure that the law will be amended to solve it. We have seen how one such law has been abolished to prepare for an elite’s demise.

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Garrett says 8 years ago

Oh I also forgot to add, didn’t the family try to get a “Letter of Guarantee” from the insurance company. Last I checked NTUC had it, although it might have changed since then…

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    lioninvestor says 8 years ago

    Hi Garrett,

    the LOG only applies to government hospitals, and even then there’s a cap.

    Reply
Garrett says 8 years ago

I don’t get it… hospitals are open 24/7. Couldn’t he has just gone to the A&E department of any public hospital instead of going to private hospital?

Nevertheless, it’s good to know about the Medisave authorization problem and finding the money before the insurance reimburses the family.

What happens if the family really cannot fork out the cash? Don’t tell me the hospital will take him off life support?

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    lioninvestor says 8 years ago

    Hi Garrett,

    He didn’t think it was anything serious, so just went to the most convenient location.

    Reply
Jasmin says 8 years ago

A whopping 12k per day in a private hospital! I wonder if medical bills in private hospitals are incredibly inflated till an unreasonable stage.

Not many people can have such a deep pocket to foot a medical bill size of 12k per day. Even if it is covered by insurance, it is bad news for the insurer too.

Can he be transferred to a government hospital to reduce the financial impact?

I read with concern regarding Patrick being unable to sign the Medisave Authorisation Form to allow the CPF Board to pay the hospital bill from his own Medisave Account. Something needs to be done asap.

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    lioninvestor says 8 years ago

    Hi Jasmin,

    Can’t transfer as he’s on life support. Involvement of multiple specialists contributed to a larger bill.

    Reply
Charles says 8 years ago

What can we learn from this?

What a wonderful healthcare system we have!

Reply
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