How to choose between different types of health insurance plans

What are the differences between MediShield Life, Integrated Shield Plans (IPs) and other hospitalisation plans? Let’s demystify the various types of health insurance plans and figure out what would be suitable for your situation.

Types of health insurance plans

a) MediShield Life - Basic Health Insurance Plan for all Singaporeans and Permanent Residents

All Singaporeans and Permanent Residents are eligible for MediShield Life¹, a basic health insurance scheme which helps to pay for large hospital bills and selected costly outpatient treatments such as dialysis and chemotherapy for cancer.

However, it is important to note that MediShield Life is sized for subsidised treatment in public hospitals and pegged at Class B2/C wards, to keep premiums affordable². For reference, B2 wards typically have up to 6 beds in a room and C wards have up to 8 beds in a room³. If you would like to stay in Class A/B1 wards or private hospitals where bills are much higher, and MediShield Life is all you have, you’ll likely have to pay hefty costs out-of-pocket as your Medishield Life payout will cover only a small proportion of your bill.

b) Integrated Shield Plan (IP) – Optional coverage on top of MediShield Life

For additional coverage of bills in Class A/B1 wards or private hospitals, you could consider purchasing an Integrated Shield Plan (IP), an additional private insurance coverage provided by private insurers designed to complement MediShield Life⁴. Those covered under IPs enjoy the combined benefits of (i) MediShield Life, administered by the Central Provident Fund Board; and (ii) the additional private insurance coverage for Class A/B1 and private hospital stays, run by private insurers. There is no duplicate coverage between MediShield Life and IPs⁵.

One thing to note is that even with IPs, you might still have to co-pay a portion of your medical bills, minimally 5%⁶ of the total bill. This can really add up if you are suffering from a serious illness that requires a long period of hospitalisation or long period of treatment.

c) Other Hospitalisation Insurance Plan - For those who do not wish to co-pay your medical bills

One thing to note is that even with IPs, you might still have to co-pay a portion of your medical bills, minimally 5%⁶ of the total bill. This can really add up if you are suffering from a serious illness that requires a long period of hospitalisation or long period of treatment. Hence you may wish to consider adding on a private health insurance plan which will reimburse your hospitalisation bill from the first dollar, with no co-insurance and deductibles.

Also, as MediShield Life is only applicable to Singaporeans and Permanent Residents, foreigners would have to consider private health insurance plans if they would like to be covered for their medical bills. 

How having a private health insurance plan is helpful for Singaporeans, Permanent Residents and Foreigners

Case studies:

Scenario 1 - Michelle is a 35-year-old Singaporean. As a Singapore citizen, she is automatically covered by MediShield Life. In order to complement her MediShield Life coverage, she purchases an IP, adding an optional rider so that she can reduce her co-payment portion to 5% and have 95% of her medical bills covered by the insurer. If Michelle gets hospitalised, her IP will pay 95% of her eligible hospital bills. The remaining 5% will be paid by her. However, if she has a private health insurance plan, the 5% will be covered entirely by the plan.

Scenario 2 - Brian is a 35-year-old Australian citizen working in Singapore on an Employment Pass.  He was warded in hospital for acute appendicitis. As he does not have MediShield or any private health insurance plan, he had to pay the full hospitalisation bill out of his own pocket. If he has a private health insurance, which has no co-insurance or deductible component in the plan, he will have a peace of mind knowing that 100% of his eligible hospital bills will be reimbursed.

There you go! We hope you understand the different types of health insurance plans better now. Knowing the differences is critical as it helps you decide if you have adequate health insurance so you can receive the necessary medical care whenever you need it without worrying about the cost.