Martin Lee @ Sg
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Means Testing to Start for Hospital Patients

Starting from 1st January 2009, patients staying in B2 and C class wards in public hospitals will have to undergo means testing to determine the amount of subsidy they will get. This new rule will affect people (in the form of higher bills) earning more than $3200/month (or unemployed but staying in private property) and who opt to stay in C or B2 wards when they are hospitalised.

The means testing will be based on a person’s level of income filed with IRAS. Different income bands will receive a different amount of subsidy. If you do not wish to allow your income levels to be checked by the hospital, you can refuse it. However, that will mean you automatically get the lowest level of subsidy.

For those people who are not working, it will be based on the value of the property they are staying in. Those staying in a property with an annual value of $11k or less will continue to receive the full subsidy. This system does have some limitations. Some retirees who are staying in private houses are already thinking of declaring a tuition income of few hundred dollars a month in order to enjoy the full subsidy.

The current subsidy of class C wards is 80% while that of B2 wards is 65%. Through means testing, the level of subsidy can go down to as low as 65% for C and 50% for B2. (Note: The subsidies for PRs are 10% lower)

While the drop is percentage might seem little at only 15%, don’t let that number deceive you. It does not mean your bill will increase by only 15%.

For C ward, paying 35% of the unsubsidised  bill compared to paying 20% of the unsubsidised bill is an increase of 75% from the current bill size.

For B2, 50% compared to 35% is an increase of 43% in your bill size.

For more information on Means Testing, you can refer to the MOH FAQ on Means Testing.

One particular question addresses those people who are currently only on the basic Medishield plan.

Will my claim from MediShield be affected?

As most patients are not affected by means-testing and will continue to enjoy full subsidies of 65% at Class B2 and 80% at Class C, most patients’ claims from MediShield will also not be affected by means-testing.

However, as MediShield premiums are the same for all insured members in the same age group, MediShield payouts are therefore similar for all insured members, regardless of subsidy status.

To ensure a fair payout across all MediShield insured members for the same treatment received, Class B2 or C patients who are affected by means-testing will have their claims adjusted such that it would be similar to that of patients receiving maximum subsidy.

Should you be affected by means-testing, you may wish to consider applying for an increased coverage under a Medisave-Approved Integrated Shield Plan. Integrated Shield Plans are offered by the following participating insurers: AIA, Aviva, Great Eastern, NTUC Income and Prudential.

What this means is that if you are affected by means testing, will have to bear the cost of the increase yourself. If you wish to find out more about how private shield plans can help you in terms of providing for medical insurance coverage, feel free to contact me for further details.

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Leave a Comment:

lana says 14 years ago

Thank you for the advise

Lana says 14 years ago

Dear Lioninvestor,

What’s your thoughts about buying hospitalization insurances?

What’s the probability the claim will be successful?

Is it worth spending $50K-$60K for hospitalization insurance?


    lioninvestor says 14 years ago

    Hi Lana,

    A H&S plan is a necessity to protect again big hospitalization bills.

    It is not so much about the small bills, but the big ones that matter.

    No one wants to be in a position where he can’t seek the appropriate treatment due to an inability to pay the bills.

    A claim will be successful as long as it isn’t a pre-existing condition (at the point the plan was bought) and doesn’t fall under the policy exclusions (eg. cosmetic surgery).

    For this reason, it is important to get a H&S plan when someone is still young and does not have any pre-existing conditions. If someone develops a serious medical condition and decides to get a h&s cover then, he is most likely to be rejected.

    Premiums below 30 years of age can cost less than $100/year.

    H&S premiums are mostly paid from Medisave. You either use the money in there to buy insurance, or pay the bills when it comes. In that case, doesn’t it make sense to spend a small amount to ensure you won’t be hit with a catastrophic bill?

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