MediShield Life

Mdm Speaker, I rise to support the Motion. Madam, I believe the MediShield Life Review Committee has considered and done its best in addressing a wide range of issues that concern Singaporeans and has produced a comprehensive report with many good recommendations for MediShield Life. In my speech, I will share why I support MediShield Life, why I believe the report forms a good basis for the design and implementation of MediShield Life, and also raise a few questions that I hope MOH can address.

In principle, our health is ours and each of us has the responsibility of taking care of ourselves. However, we know in reality that relying on ourselves alone may not be sufficient, as healthcare expenses can be costly and not everyone has high earning power. Moreover, some Singaporeans may be more unfortunate to be hit by serious illnesses or chronic conditions, requiring long-term and expensive treatments. Hence, there is a need for additional support from other sources.

Different countries adopt different ways of tackling this issue. Some completely socialise this cost and fund healthcare through taxes. But this can lead to escalating and potentially unsustainable, public healthcare expenditures. In some developed economies, public healthcare expenditure is one of the most costly fiscal items each year and, hence, a top government headache. Others do it through insurance: collecting premiums from everyone, pooling the funds collected and then allocating the money to purchase health services as required by the population. But such systems work only when everyone contributes, regardless of whether they think they will need to tap on the common pool now. This requires a strong sense of solidarity as a nation and the willingness to help our fellow countrymen.

In Singapore, we are not immune to this challenge, as very eloquently articulated by my colleague Dr Chia Shi-Lu. In response, we have developed the 3M system – firstly, the Medisave, which is our money and we use it to co-pay for our own medical expenses; second, MediShield, which is everyone's money that we pool together to help one another to afford high medical bills when we suffer severe illnesses; and lastly, Medifund, which is Government's money, also taxpayers' money, that acts as the ultimate safety net when all else fails to help vulnerable Singaporeans.

While the 3M framework is robust, we can do more as a society. We have been expounding the need to be caring and inclusive. We all feel a deep sense of compassion when we see someone in pain and we all feel the need to help that someone regain the health and strength to lead a normal life like we do. We talk about it, we argue for it and this is the time for us to do it. A universal public health insurance in the form of MediShield Life is how we can do so, by pooling our risks and money together to help pay for one another's bills. No one gets left out, everyone gets a chance to tap on it, if not today, then tomorrow, although,

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ideally, it would be the most ideal situation that we all remain healthy so that we have the capacity to really enjoy life and do what we want to do.

The report made recommendations to tackle the wide-ranging concerns that Singaporeans have – from the adequacy of coverage to the expected premium increase and to how current IP policyholders will not be left worse off with the transition to MediShield Life. The degree of thought and sophistication in these recommendations lead me to believe that the Committee has carefully considered all the trade-offs.

So far as I have read the report, most of the concerns that my residents have raised to me, especially from my elderly residents in terms of affordability of premiums and the adequacy of coverage as well as the co-payment, the deductibles, I think all of these have been very adequately and eloquently addressed in the report and I am heartened by this.

Two points in the report that struck me were the assurance that the premiums will be fully payable by Medisave and that no one shall be left uninsured because of financial difficulty. Such a promise is a demonstration of our Government's fiscal strength. Few other countries can afford to do the same.

However, I do have a few questions that I hope MOH can address.

Firstly, can MOH share how the premiums are derived? How confident is MOH that these amounts will be adequate in supporting our current and future healthcare needs, given the enhanced coverage?

Second, how confident is MOH about the long-term affordability of the increased premiums? Will MOH continue to monitor and, if need be, take steps to mitigate the impact of the increased premiums on Singaporeans after the five-year transitional subsidy period? And at the risk of sounding like I am contradicting myself, really, how long can MOH sustain the subsidies that it has been promising Singaporeans within these five years and possibly beyond the five years?

Third, the majority of Singaporeans have CPF contributions and, hence, are able to cope with the premiums through our own Medisave. But what about those who have no income and, therefore, no CPF contributions? These include housewives and Singaporeans who have suffered long- term unemployment. A number of them may not come from well-to-do families and their family members will be unable to help pay for their share and, for some others, they may not even have reliable family members around to even help them. How will MOH support this group of Singaporeans so that they, too, will be covered?

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And fourth, for Singaporeans with unstable income, such as freelancers, how can they cope with the annual premium payments?

MediShield Life is a bold scheme that we must support. It gives hope and assurance to those who suffer serious illnesses and have to incur large bills. However, it would be a great let-down if this hope was shattered because MediShield Life cannot be.

Sustainability of MediShield Life is perhaps the largest trade-off for the enhanced benefits it brings. In reality, sustainable healthcare financing is an issue everywhere – whether it is in Canada, US, Europe, Australia, Taiwan or Japan. These countries face escalating healthcare costs and have insolvent schemes. The systems are essentially surviving on borrowed time. For instance, the National Health Insurance in Taiwan saw its government having to borrow from banks because there was insufficient money in the pool. The one in Japan is facing such a large financing gap that increasing co-payments and other measures will not be sufficient to close it. Medicare in the United States is also fast becoming unsustainable as the enrolment into the programme is growing faster than its economy. Once introduced, such systems become entrenched. Any subsequent reforms will be difficult. And these also highlight the importance of designing, at the very onset, having careful, thoughtful design of a public health insurance system and, therefore, I think this is something that is very important for us – whether for the Government, for us as a nation – and that we need to think about very carefully.

In Singapore, we have been able to provide large subsidies in the billions of dollars only because our country has enjoyed decades of good economic growth. However, what of the future, when our own growth is predicted to slow down, when economic conditions are expected to become more volatile, when we face an ageing population, and with smaller families? In addition, healthcare costs have been projected to increase exponentially. We see it in Canada where healthcare costs are rising far beyond the increase in their real income and this is something that I believe is not just us in Singapore or even Canada but all around the world, all the developed economies are facing the same problem. One of the key cost drivers is the cost of manpower, which, for us in Singapore, is something that continues to be a challenge that we have to grapple with today. Given these forces, I would like to ask: what is MOH's assessment of the sustainability of the proposed design of MediShield Life, and could MOH share how it intends to keep the scheme sustainable?

Sustainability also depends on whether the scheme will enjoy universal support. If health insurance is left to private insurers and they can choose who they want to insure, then those with pre-existing conditions, precisely the people who are most in need of insurance, will be left out in the cold. Similarly, we need to also make this compulsory for every Singaporean to be in MediShield Life because if those who are healthy today decide that they do not need to be insured now, then we will have an impossible situation of having

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only the ill in the pool, which is certainly unsustainable.

Some countries also face the issue of chasing for premium payments. In Japan, for example, those who cannot or refuse to pay for the premiums may eventually have their properties seized to pay for the arrears. Arguably, we are different in that we have Medisave accounts that we can deduct from. But how will the MOH attempt to resolve the issue when people cannot pay the premiums, or can no longer pay for the premiums from their Medisave? And before I continue and conclude, please allow me to speak in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] Mdm Speaker, I think the launch of MediShield Life is timely and appropriate. MediShield Life is a universal healthcare insurance scheme. It removes the age limit so that all Singaporeans will be covered. It ensures that all Singaporeans will receive basic protection.

For a long time, we have been hearing Singaporeans voice their concern over the rising medical cost, so much so that some dare not see a doctor even when they are sick. As a fellow Singaporean, I feel a deep sense of compassion for those who are sick but have no money to receive treatment.

Besides Medisave and Government subsidies, MediShield Life is another very important pillar.

As unpredictable as the weather, people's fortune may change overnight. Nobody knows when he will fall seriously sick and incur high medical expenses. To cope with such uncertainties, MediShield Life plays an important role. It is based on the principle that "if one person is sick, everyone helps to pay"; it pools everyone's money together, so that people who need it can cope with large hospital bills. Everyone gets a chance to draw on it.

Now, our population is ageing rapidly, while family size is getting smaller. It is necessary for Singaporeans to help each other and tide over difficult times together. Hence, we must support MediShield Life to prepare for ourselves and others for the future.

Although, in principle, MediShield Life is good, the Government must pay attention to whether people can afford the increased premium due to larger coverage in the long term, as well as how to ensure the scheme's sustainability, to avoid the dilemma faced by other developed countries. The Government should take these into consideration.

I believe, our ultimate goal is to ensure every Singaporean can receive healthcare protection. Nobody should be deprived of treatment because of financial difficulty.

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MediShield Life must succeed to meet people's expectations.

(In English): Mdm Speaker, all said, implementation is still key. The potential issues that come with a large scale and costing scheme are aplenty. The abysmal implementation of Medicare in the US provides many lessons of what can go wrong. Our MediShield Life is enormously complex, and complexity increases the possibility of errors. Could MOH share how it intends to ensure that its implementation will proceed smoothly and correctly?

Part of the implementation must be communications. The elements of this policy are highly complex, and we need to make an extra effort to make sure that Singaporeans understand what it means to them, and how they can benefit from it. I note that the Government has tried many new and innovative approaches to communicate the elements of the Pioneer Generation Package to Singaporeans, especially our elderly. I applaud this effort, and I hope that MOH will also make similar, if not greater, efforts for MediShield Life.

Mdm Speaker, while I have raised questions on the long-term affordability of premiums for Singaporeans and sustainability of MediShield Life, which I believe MOH will have to address, I have no doubt that having a universal public health insurance, such as MediShield Life, is imperative in strengthening our national healthcare financing framework.

And very, very lastly, I would just like to add one more thing, and that is, no matter how robust or how watertight our public healthcare financing framework is, nothing beats having good health because having good health will enable us to have the capacity, the energy and whatever we need in order to enjoy life to fulfil our aspirations and do what is meaningful to us in our life. So, I urge everyone, whether it is in this Chamber or outside of this Chamber, to always live a healthy life because health is not something that we can buy using any amount of money. With that, I support the Motion.

Mdm Speaker, anxiety about healthcare affordability weighs heavily on the minds of Singaporeans – not only the elderly, but also their adult children and those who will become old and face the risk of falling seriously ill. It is, therefore, important for us to work together as a nation to find solutions to the challenging problems regarding healthcare affordability, quality and accessibility in Singapore.

I would like to thank the MediShield Life Review Committee for widely consulting Singaporeans on their concerns and taking so many of these into account when crafting their recommendations to the Government. I also commend the Committee for taking the

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initiative to address some key issues that went beyond the terms of reference given to them by the Government.

I support the Motion endorsing the Committee's report as the basis for designing MediShield Life. However, I have a number of concerns about some details of the scheme, which I will focus on in my speech today.

At the heart of the report lies the recommendation to provide Singaporeans with better lifetime protection against large medical bills and to strengthen our social safety net. Pulling these recommendations in both directions are the competing priorities of, on one hand, the need to make MediShield Life affordable to all Singaporeans and, on the other hand, the need to ensure that the scheme is financially sustainable. This is the key challenge before this House today.

On the issue of affordability, I am glad that the Government will be providing permanent premium subsidies for low- and middle-income earners. The Committee has suggested that the process for applying for subsidies should be as simple and convenient as possible. I agree and I would like to reiterate my earlier calls for premium subsidies to be provided automatically to households that have already undergone means-testing for other Government assistance schemes. For example, all households with Community Health Assist Scheme (CHAS) Blue and Orange cards should receive MediShield Life premium subsidies without having to apply separately. The same should apply to recipients of Medifund, Public Assistance and ComCare.

Polyclinics, hospitals and private clinics should step up efforts to assist all their patients to apply for CHAS, so that they can receive both outpatient subsidies under CHAS and MediShield Life premium subsidies. The Government should reach out to all lower and middle income Singaporeans before the start of MediShield Life, so that they do not miss out on the premium subsidies that they are entitled to.

I would also like to suggest that the income criteria for premium subsidies be pegged to healthcare inflation so that the value of the subsidies is not eroded with rising healthcare costs and premiums.

On the issue of financial sustainability, the Committee has reiterated the Government's conservative approach of setting aside substantial reserves in the MediShield Life Fund to meet current and future liabilities. It did not suggest any changes to the reserves framework. This is an area that begs further examination. It is not just an academic exercise. The reserves framework impacts the premiums that people are required to pay.

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Let me state for the record that I believe that MediShield Life should be financially sustainable in the long term, and that enough reserves must be set aside for temporary spikes in claims and long-term liabilities.

However, there is a big difference between setting aside enough reserves and setting aside too much reserves. Setting aside enough ensures that MediShield Life Fund remains solvent even when claims in a particular year are higher than expected. Setting aside too much could mean collecting excessive premiums to cater to an extremely unlikely, but catastrophic event.

So, how much is "enough" and how much is "too much"?

The Monetary Authority of Singapore (MAS) has in place a Risk Based Capital Framework which regulates all insurance funds, including MediShield. The framework defines, among other things, how much the fund needs to set aside to ensure capital adequacy and solvency. This is measured using the Capital Adequacy Ratio (CAR), which is the ratio of a fund's net assets to its total risk requirements.

The MAS expects insurance funds to meet a CAR of 120%. According to an answer to my Parliamentary Question last October, the CAR of the MediShield Fund was 165% as at the end of 2012, which is 45% higher than MAS requirements. At the end of 2013, the MediShield Fund had net assets of $613.3 million, which is more than 1.8 times the total claims paid out in the past year.

The Health Minister said, in response to the same Parliamentary Question, that the MediShield Fund has set a target CAR of 200%, which is 80% higher than MAS requirements.

Madam, is there really a need to set aside so much in reserves? While this manages the risk for the fund, it could be placing an unnecessary premium burden on policyholders.

If the pace of reserves accumulation can be adjusted to be more in line with MAS requirements, premiums can then be made more affordable. The fund can still maintain a comfortable buffer above MAS requirements, but I do not see the justification for exceeding the requirements by 80% when the regulator's requirements are already quite conservative.

Another result of parking aside too much in the reserves is that the Medical Loss Ratio of the MediShield scheme becomes very low. In 2013, the Medical Loss Ratio of MediShield was 44%, which means that out of every dollar that was collected in premiums last year, only 44 cents was paid out in claims. This is the lowest loss ratio since 2001.

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As I pointed out during the last Parliament Sitting, under the Affordable Care Act in the United States, commercial insurance companies are required to issue premium rebates to policyholders if their loss ratio falls below 80%-85%. Can MediShield Life, which is a not-for-profit scheme, do something similar, so as to reduce the premium burden on Singaporeans?

Healthcare expert Dr Jeremy Lim has commented on the lack of actuarial data on MediShield Life being made available to the public. I agree that more detailed data will enable the public and independent experts to validate the conclusions put out by the Government, especially with respect to the premiums that need to be collected to keep the Fund solvent.

It would be helpful if the Government could make known its targets for the medical loss ratio, capital adequacy ratio and reserves for MediShield Life.

Since the Government says it needs to keep a large amount in reserves for "adverse scenarios", it should explain what kind of adverse scenarios it is expecting and how much it expects them to cost.

Finally, as MediShield Life will be front-loading premiums, its annual reports should distinguish how much is being collected for pre-funding and how much is being collected to fund current claims.

Next, I would like to discuss the issue of portable medical insurance. It is good that the Committee has brought this up in its report.

The report noted that less than 5% of employers offer portable medical benefits, and most companies that provide inpatient benefits do so through Group Hospitalisation and Surgery insurance plans (GHS) that are separate from MediShield. It acknowledged that GHS plans are "usually more attractive" than those provided by MediShield, MediShield Life and Integrated Shield Plans, and tend to offer "higher perceived value" to employees at relatively lower costs for employers.

This presents a steep challenge to adoption. We are essentially asking many employers and employees to shift to an inferior plan that may cost more.

Because of this, I think we need to approach the messaging from a different angle to encourage adoption. First, we need to explain to employees that there are clear benefits to portable insurance. When they change jobs, they can retain their cover. Second, the universal mandate for MediShield Life means employees will already be paying premiums, whether or not their employers offer portable plans. So, portable benefits provided by

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employers could help lower the premium burden on employees.

Third, having a single comprehensive insurance cover instead of a patchwork of duplicate covers means the employee should be able to claim a larger share of his hospital bill. And fourth, not all employers currently offer inpatient medical benefits to their employees. These employers could be encouraged to take the first steps by helping their employees pay for their MediShield Life premiums, as this will make them more attractive organisations to work for.

To make portable benefits more attractive and comprehensive, employers could not only contribute towards their employees' MediShield Life premiums, but also consider purchasing riders to cover some of the co-payments, so that the out-of-pocket payments by their employees will be reduced.

The Government should take up the Committee's suggestion for an adoption grant to be made available to companies to assist them in making a move to portable medical benefits that ride atop MediShield Life. MOH should also increase its efforts to better educate companies of the continuing tax incentives available and the benefits of providing portable insurance to their employees.

Next, I would like to touch on Integrated Shield Plans. The Committee has suggested that the Government should work with the insurance industry to develop key features for a Standard Plan that will provide coverage at the B1 class level in public hospitals. This Standard Plan appears to serve two main purposes: first, to provide a benchmark for consumers to compare against the plans offered by private insurers; and, second, to set the Medisave Withdrawal Limit for Integrated Shield Plans.

On the first point, I share the frustration of many consumers in choosing the best Shield Plan. The Plans are currently offered by five insurance companies, with each trying to differentiate itself by offering a different set of benefits. Sometimes, comparing them is like comparing apples with oranges.

Worse still, many consumers get their information about the Integrated Shield Plans from insurance agents representing individual insurers. Naturally, we cannot expect these insurance agents to give completely unbiased advice, since it is their job to market their own company's products.

The net result is that consumers end up either choosing a plan that is not the best for them and their families, or they end up confused and unsure of which plan to choose.

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I note that MOH has a section on its website that provides a comparison of MediShield and different Integrated Shield Plans. This is a good initiative that should be better publicised, so as to reduce confusion and encourage more consumer self-service. It could also spur more competition and lower prices, as insurance companies will compete more on features and price, and less on their marketing ability.

I would like to seek more clarification on how the Standard B1 plan will be implemented:

First, will the Government tender out the Standard Plan to only one insurance company or will all insurers be expected to offer this plan? If it is tendered to one insurer, how will it ensure sufficient competition such that the premiums and benefits are to the advantage of consumers?

Second, if existing Integrated Shield Plan policyholders decide to switch to the Standard Plan, will they be subject to underwriting, where their pre-existing conditions will get excluded or risk-loaded? If so, it would probably not make sense to switch, especially for older policyholders who are likely to have developed pre-existing conditions.

For many Singaporeans, the main issue they have with Integrated Shield Plans is that the Medisave Withdrawal Limits are too low, forcing them to cough out cash to pay their premiums. This is especially so for older policyholders, who now have to top up anywhere between $100 and $3,500 a year in cash to pay for their B1 plan premiums. This is frustrating for many of them, especially retirees who are short on cash but have sufficient Medisave balances.

I hope the development of a Standard B1 Plan will raise the Medisave Withdrawal Limit to better meet the cost of Integrated Shield Plan premiums, especially for older policyholders.

Mdm Speaker, MediShield Life is a welcome shift in policy towards stronger social safety nets. In its 1993 Healthcare White Paper, the Government sounded a warning against an over-reliance on medical insurance and the risk of moral hazard. Now, 21 years later, the Government has responded to a louder voice of the people with a universal scheme that has better benefits, lower co-payments and subsidised premiums. This is a step in the right direction towards a more caring society.

Mr Deputy Speaker, the debate on MediShield Life in this House will give greater insights on possible loopholes or areas that need to be

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addressed. Some of these are valid and worth deeper consideration.

I would like to urge the Government to err on the side of caution and adopt a more conservative approach when reviewing these suggestions for MediShield Life because we have yet to know with certainty the full impact of MediShield Life on our future healthcare expenditure.

Mr Deputy Speaker, planning for our universal healthcare system must take into account future demographic changes affecting our healthcare. A rapidly ageing population with many elderly suffering from severe illnesses which are treatable, given advances in medical sciences, will dramatically increase the cost and complexity of healthcare.

Moreover, individual well-being and quality of life are accorded more importance these days by many people. Today, many people expect that, in spite of having a chronic disease, an individual should still enjoy a high quality of life, with access to a variety of medical treatment to control their illness. Today, healthcare patients are different from those of the past. Many are well-informed, through the wealth of knowledge on the Internet, and they want greater access and freedom of choice to quality healthcare services. As patients demand better services, the future pressure on our healthcare will increase rapidly.

Mr Deputy Speaker, future advances and technological progress in medicine will also be an additional cost factor. Unlike traditional commodities where technological advancement makes them cheaper to produce, medical advancement will add to demand for healthcare and, hence, has an enormous potential to increase medical expenditure substantially.

While it is the duty of the Government to provide sufficient access to healthcare with adequate benefits, we must take great care to ensure the financial sustainability of our healthcare system that addresses the needs of the present without seeding an unbearable burden for the future generation. This can be detrimental to our nation because overburdened taxpayers may move to other countries, given the fact that tax competition is on a global playing field.

I believe many countries that have implemented universal healthcare have the noble intention of looking after the healthcare needs of its people. While some of them have claimed success, there are those in some countries where the universal healthcare system is in danger of being dysfunctional and characterised by unequal access to healthcare, and uncontrollable and rising healthcare costs. As we are developing our first universal healthcare system, I am glad to know that we have learnt from the rich, practical, day-to-day experiences of other nations and taken steps to mitigate the negative experience of these

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nations that have embarked on universal healthcare system.

Mr Deputy Speaker, I would like to strongly urge that the Government make clear distinctions as to what is a "must-have" and what is a "good-to-have". MediShield Life should cover the essentials that every Singaporean must have in terms of healthcare protection for life. Beyond that, Singaporeans are at liberty to decide whether to expand their healthcare coverage through the Integrated Shield Plans offered by private insurance companies. Given MediShield Life co-exist with Integrated Shield Plans, does MOH have any plans to regulate these private insurers to ensure that policyholders are not shortchanged by Integrated Shield Plans through disclaimers and terms and conditions not made known clearly to the clients? Reported cases where patients were not allowed to renew their Integrated Shield Plans by some insurance companies after they have started making claims should not be allowed to happen.

Related to this extra medical coverage is the need for companies to review their health and medical benefits that they accord to their employees. I am glad that our GPC Chairman for Health, Dr Chia Shi-Lu, and the hon Member Mr Gerald Giam support the Portable Medical Insurance scheme that NTUC had been pushing for several years. But the context under the old MediShield was not conducive for us to achieve a breakthrough due to the annual life time and claim limit. Weighing the pros and cons of PMBS relative to MediShield, the value proposition offered by PMBS at that time was not attractive. Employees want to tap on their companies' insurance for hospitalisation bills to save on their Medisave and preserve their claim limit. However, with MediShield Life, NTUC has renewed the call for employers to implement PMBS. I am pleased that a tripartite committee has been formed to look into it.

Mr Deputy Speaker, I support the move to extend MediShield Life to our Permanent Residents that have played an important role in our nation-building. However, there were some concerns that this may create a potential loophole as people from other countries with existing chronic illness may apply for permanent residency status in Singapore just to enjoy universal healthcare coverage. Obviously, this may lead to further pressure in healthcare cost under MediShield Life. Hence, I would like to know what steps will be taken by MOH and ICA to prevent such possible abuses to our MediShield Life system.

Mr Deputy Speaker, I had a dialogue with my residents on MediShield Life. One of my residents shared with me his painful experience of having to incur a substantial amount for his medical bill for an angiogram and angioplasty operation in 2005 that he had in a private hospital. He could only claim $4,000 from his Medisave and MediShield for the $19,000 hospital bill. The balance had to be paid in cash despite him having substantial Medisave savings. He may not be the only one having gone through such an experience.

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I attribute this to a lack of public education and awareness of the treatment and claimable limits under our current MediShield scheme. While such limits are imposed to better manage future healthcare costs, it can be quite hard for a person to understand having to pay a large sum of cash despite having substantial Medisave savings.

Moving forward under MediShield Life, I hope the Government makes greater efforts to ensure better education and greater awareness amongst MediShield Life patients with regard to the coverage provided. How do we plan to bring forth the necessary knowledge with regard to MediShield Life to the public? Do they have a clear understanding of what MediShield Life may be used for and what it cannot be used for? Could the hospitals' customer patient service officers, especially those in private hospitals, be better equipped with the necessary knowledge to advise on coverage by MediShield Life, together with their advice on treatment open to the patient? This way, we would mitigate the potential for Singaporeans finding themselves in a situation of huge bill shocks due to misconceptions that they would be covered under MediShield Life. With greater awareness, Singaporeans would be better able to plan their finances around co-payment for medical treatment, instead of falling into financial difficulty. Mr Deputy Speaker, please allow me to speak in Malay.

(In Malay): [Please refer to Vernacular Speech.] The MediShield Life scheme, in general, will be beneficial to all Singaporeans and Permanent Residents because no one can predict the likelihood whereby they have to shoulder high medical costs.

The move to make MediShield Life scheme compulsory will be advantageous to families who usually do not obtain any health insurance coverage for themselves or their family members. Within this group, there are those who have chronic health problems that require long-term treatment and expensive medical care. Through MediShield Life, the Government has made it easier for everyone, regardless of educational background or income level to receive the necessary treatment. For those among the Malay/Muslim community who usually do not have medical insurance coverage due to financial reasons or lack of awareness about medical insurance, MediShield Life will provide the basic coverage that is much needed by everyone. The subsidies provided to the needy will bring us closer to our goal of building a more inclusive and fair society in Singapore.

Even so, I would like to urge the Government to be cautious when considering the suggestions that were given, especially the ones about providing higher subsidies or about allowing new medical treatments that will be placed under MediShield Life. Our demographic profile will change whereby more people will live longer. This trend, together with rapid advances in medical technology, can increase medical costs. Therefore, the Government must be careful because we have yet to identify the costs of medical care in the future that can affect the premium amounts to be paid. To ensure that Singaporeans continue to receive sufficient medical coverage, the Government can set up a medical

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committee that conducts studies periodically to ensure that the MediShield Life scheme remains effective and affordable for most Singaporeans.

The hon Member Mr Faisal Manap has suggested that the CLF study the issue of health within the Malay community. He acknowledged that a lot of efforts have been made by Malay/Muslim bodies to increase awareness among the Malay/Muslim community regarding health issues. I am of the opinion that it would be better if MOH itself conducts the review on these efforts because they have better resources and information to do a better job. I feel that it is more important that we increase efforts to engage our community about MediShield Life and it can be done with the support of MENDAKI and MUIS.

(In English): Mr Deputy Speaker, may I take this opportunity to thank the MediShield Life Review Committee and the Secretariat for an outstanding and grateful work in recommending a milestone change in our healthcare system. Mr Deputy Speaker, I support the Motion.

Mr Deputy Speaker, I rise in support of the Motion. The universality of the proposals for MediShield Life is quite striking. The idea that every Singaporean will be covered from birth, that this would be an attempt to reach out to the whole of our society and nation, is a source of pride when I think about what it represents for our social mindset at this point of our nation's development.

The idea that we will move from ensuring "we look after ourselves" to "we will look after ourselves and each other" is, to a significant extent, a very deep shift, and one that will set the stage for how we see ourselves, going forward.

With a national healthcare insurance scheme, the issue of a healthy lifestyle for all is no longer an individual problem. As my colleagues Ms Tin Pei Ling and Dr Chia Shi-Lu have pointed out, the issue of a healthy lifestyle now becomes a national problem. Like them, I would be very interested to know the specifics of how MOH, HPB and MOE and the rest of the Government would go on to drive this issue of a healthy lifestyle because it will be the single most important thing that we can do to deal with the issue of rising medical costs, going forward.

Even if we did successfully turn that process around today, it will take a number of years to see the benefits, many decades, perhaps. So, there will be a period of time when rising healthcare costs will prevail. I am heartened to hear so much has been put into the thinking and consideration behind making this scheme financially sustainable for the long term. But I

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would be interested to know, and to ensure, that there are mechanisms to review those Singaporeans who will fall through the cracks, especially with respect to their out-of-pocket expenses, and that has been mentioned before.

One specific thing that I would be interested to find out about from MOH is: Singaporeans benefit from academic excellence at our tertiary public healthcare institutions. They benefit from cutting-edge technologies and treatments, as well as medical strategies that are informed by academic research on our population. This burden of research and academic pursuit is borne largely by our public sector, and, so, it is the public healthcare system that sets the bar. In other jurisdictions, the weight of insurance-funded healthcare has reduced the emphasis on research and academic excellence, primarily as a means of controlling costs. This has not always caused a decrease in the progress of the academic pursuits if there are funds available from alternative sources. Philanthropy is one good example in the United States, for example.

In our society, there is not a significant investment in academia and medical research outside the public sector, and now, in our landscape with universal, national healthcare insurance in the public sector, will there be a pressure to reduce research and cutting-edge medicine in an attempt to reduce costs? Will Singaporeans continue to receive the best possible medical care in the public institutions, as they currently do and have appropriately come to expect? Will the public healthcare institutions be able to continue to pursue these missions of providing excellent care, training the future generation of healthcare providers, and developing better treatments to suit our population? Will the proposed changes affect these in any way?

Sir, before concluding – I have some way before concluding and I promise not to repeat my infringements the last time I attended this podium – there are some issues I would like to address that Mr Giam had brought up, which I believe represent a misunderstanding. This misunderstanding is instructive. Our medical healthcare financing systems are complex. The changes to MediShield Life are potentially complex. And, misunderstandings, such as these, can arise, and they should be addressed adequately by MOH and other parts of the Government.

The first thing I would like to address is the issue that he brought up of the Capital Adequacy Ratio (CAR), and he highlighted that the Monetary Authority of Singapore (MAS) has a requirement of 120% of CAR for private funds. He contrasted this with MediShield Life's – I think it was 163 or 167 that he quoted from his Parliamentary Question – and questioned whether this was appropriate.

The thing to appreciate is that the 120% set by MAS is not a target for the funds, the insurance schemes, to meet. It is a floor. It is a floor that they must operate above. If they

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breach that floor, there are very, very significant regulatory requirements. It is inappropriate to compare the floor with the target that MediShield Life might have.

What should we compare it with? Perhaps, we should ask ourselves what do the insurance schemes and other funds target as their Capital Adequacy Ratio. It is not 120% because that is what they have to stay above, and because of variations in cash flow in markets and the assets that are marked to market, they target a level of 200% CAR or more.

These are the private for-profit companies. And you would expect, in order to maximise profit, they have to sail as close to the wind as possible. Yet, these companies, understanding these schemes, understanding the significant amount of variation that puts their operations at risk should they breach that floor, are operating at 200% or more. This is the correct thing to compare with, not the absolute requirement from MAS of 120%. It is a misunderstanding and I hope that would be clarified.

There is another misunderstanding, and this is something that Mr Giam has brought up today, at the recent debate on the President's Address – and he has also written about it on his blog about the Medical Loss Ratio. He described the Medical Loss Ratio as being 63% over the last 11 years, 75% in 2012. Those numbers are true if, and only if, one was considering the simple Medical Loss Ratio. That is, if you just take the premiums that are collected with the cash paid out in a given year, those figures are correct.

His mistake, however, is to compare this with the Affordable Care Act in the United States, or ObamaCare, where he quoted 80% to 85%, and he is comparing these two numbers. He is not the only one to do so. There are a number of online commentators who have done something similar. The reality is that in ObamaCare or the Affordable Healthcare Act, the 80% to 85% mandate includes the direct claims. It includes the unpaid claim reserves, the changes in the contract reserves and reserves for contingency benefits. This is not the same as what we are talking about for the MediShield Life's simple loss ratio.

So, let me state that again so that we are all quite clear. What he has described is a simple ratio between the premiums that are brought in and the claims that are paid out every year. He has compared this with the United States where, on the one hand, premiums are brought in, claims are paid out, money is put aside for unpaid claim reserves, money is put aside for changes in the contracted reserves, and money is put aside for contingency benefits. In actual fact, under the US system, other things are classified as claims, including quality healthcare initiatives.

If we take the same approach for Singapore, we need to use something that we call the "Incurred Loss Ratio", where we compare the premiums that are paid in, the claims that are

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paid out every year, together with what we have to do to put aside to fund the liabilities, going forward. So, it is not a simple issue. This data is available through the CPF Board Annual Report and it is also available in the series of Parliamentary Questions that Mr Giam had asked before.

If we do that and we calculate our situation in Singapore, what we find is the Incurred Loss Ratio is very, very different from what Mr Giam has described. It was 119% in 2011; 111% in 2012 and 91% in 2013. That averages out at 96% over the last five years. So, in our numbers and statistics, what we see is that MediShield is paying out claims and putting aside money it needs in order to pay out claims. It is not making a profit. This money is not disappearing somewhere. It is being put aside prudently.

If we took an ideal situation and not-for-profit scheme – and the Minister has repeatedly said that MediShield is not a for-profit scheme – that number would be 100%. But it is going to vary on either side and that is exactly what we see. Some years, it is slightly more than 100%; some years it is slightly less than 100%. That is exactly what we expect to see: the money is paid in, it is paid out to people who need it, and some is put aside so that it can continue to pay people who need it. The purpose of MediShield Life – and MediShield in the past – is only to help Singaporeans with large hospital bills.

The comparison is inappropriate. Is it just a small matter, a technical term – Loss Ratio versus Incurred Loss Ratio? First thing is, it involves millions of dollars, hundreds of millions of dollars, so, it is not that small a matter. If I can give Members an analogy of the extent of this inappropriate comparison – what Mr Giam has done is analogous to trying to compare two companies. One is an American for-profit company and the other is a Singaporean social enterprise. In trying to compare the financial position of these two companies, on the one hand, he has said, "Tell me everything about this company – your income, your expenditure, your profit, your loss, your liabilities, your debts, your total financial position." And then, looking at the Singaporean company, he said, "I want to know the cash flow." On the basis of that, he has compared the two. It is completely inappropriate, and it is a misrepresentation of the financial position of MediShield in the past and going forward.

I am sure these are honest mistakes, which represent a misunderstanding. This is a complex series of issues, but the record needs to be set straight. The facts need to be on record. We all need to work at making sure that Singaporeans understand the truth of our financial position, our policy intent, and where we will be, going forward.

I hope Mr Giam will join me in fixing the misunderstanding for Singaporeans and helping them to understand the true situation of MediShield and MediShield Life.

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Mr Deputy Speaker, Sir, the review of MediShield Life marks an important phase in the development of our unique model of public healthcare and financing – one that is studied around the world and admired by many. Singapore is at a point in our history where we can be bold about new boundaries and plan ahead for future challenges. But we must remain true to our principles and ensure that these changes and the new schemes are sustainable for the long term. Sir, I support the Motion.

Mr Deputy Speaker, the MediShield Life Review Committee had not only done a lot of hard work, it had also taken the bull by the horns on a deep-seated controversial issue of public health insurance scheme.

Many countries have implemented public health insurance that provides for universal coverage. For instance, Germany has one of the oldest social health insurance schemes since 1883 through Otto von Bismarck's Sickness Insurance Law designed back then for the benefit of manual workers. Currently, the German's basic health insurance plan covers 85% of their population and the premiums are paid jointly by employers and employees. In 2010, the total healthcare spending in Germany was about 11.3% of its GDP, as compared to 4% in Singapore.

As Singapore moves towards universal healthcare insurance, coupled with medical cost inflation and our ageing population, it is inevitable that our healthcare spending as a percentage of GDP will grow. However, we need to guard against increasing our healthcare cost to more than 10% of GDP, as in the case of Japan and most European countries or, worse, 17.9% in the case of the United States. With this as the backdrop, allow me to provide my perspectives, based on three broad categories of Singaporeans.

The first category refers to the majority of Singaporeans who are contented with basic MediShield Life coverage. The second category refers to the more affluent Singaporeans who prefer to have Integrated Shield Plans (IPs) so that they could afford to stay in B1 ward or above. The third category refers to a small minority of Singaporeans who could not afford to pay the MediShield Life premiums despite best efforts.

The majority. With the compulsory MediShield Life, 270,000 currently not insured under MediShield will also be insured. In addition, with the MediShield Life's focus on classes B2 and C, we do not need Einstein to tell us that the demand for hospital beds of these two class types would increase. Do we have a situation of hospital bed shortages? We certainly

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do. Are we doing anything about it? I am sure it is an item on the Health Minister's mind.

My hope is that there is no secondary prioritising of the increase of class C and B2 beds in the light of the Prime Minister's revelation of postponing some $2 billion worth of public construction projects because of the tight labour market environment. The importance of adequate number of hospital beds cannot be overlooked and lost on us. It would be a terrible injustice to our healthcare providers working so hard to create a world-class system, only to be attacked by someone who likes to play up the scene of patients lying along the corridors.

Next, I strongly support the Committee's call on employers and unions to work together to avoid duplication in the light of MediShield Life. Mr Deputy Speaker, I would go further than this and urge the Government to use its wide moral influence to ensure that more companies start to utilise MediShield Life for their workers' medical benefits rather than relying on private insurance coverage, such as the Hospitalisation and Surgical (H&S) Plan. Specifically, MOH could facilitate a framework to allow employers to directly pay or co-pay the employee's MediShield Life premiums, in addition to the usual Medisave contribution before the employers start to buy H&S Plan for the employees or their dependants. This would help us to realise the goal of portable medical insurance coverage for our workforce.

In short, the majority of Singaporeans would like their employers to pay or co-pay their MediShield Life premiums and that of their dependants without wasteful duplicate payments to the private insurers.

Page 78 of the White Paper notes that 60% of Singaporeans have Integrated Shield Plans (IPs) and yet, 7 in 10 Singaporeans who have IPs to allow them to stay in class A wards choose to stay in lower ward classes when they are hospitalised. As reported in the Sunday Times, this is akin to one buying an expensive business class air ticket but choosing to be seated in the economy class when he boards the airplane. So, why do Singaporeans buy the IPs in the first place?

One reason could be ignorance. Another reason could be that most Singaporeans who bought IPs are contented with B1 ward in the public hospitals but most private insurance companies only offer policies with higher wards. Or, worse, they are "oversold" by the insurance agents.

Hence, I am glad that Minister Gan has agreed with the Committee's recommendation to work with private insurance companies to develop a universal portable B1 ward IP, or what I call a B1 IP for short.

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Certainly, with the universal B1 IP, Singaporeans who are contented with B1 wards in the public hospitals do not have to pay extra premiums for IPs that are meant for class A ward or wards in the private hospitals.

With the universal B1 IP, employers could choose to pay B1 IP premiums for their employees instead of buying additional H&S policies again, which is a waste and is not portable. I hope MOH would strongly persuade employers to do so. Certainly, employers could also have the option to pay additional premiums to cover their employees for class A wards in private or public hospitals, if they can do so.

I note that the Minister, in his speech, did not mention whether Singaporeans with pre-existing illnesses could purchase the universal B1 IP with additional premiums, similar to the basic MediShield Life scheme. If we leave it to the private insurance companies, it is unlikely that Singaporeans with pre-existing illnesses could join the B1 IP. Thus, we hope that MOH could work with the insurance companies to determine the additional premiums that Singaporeans with pre-existing illnesses need to pay, based on a few broad categories of pre-existing illnesses so that all would have a chance to come on board the B1 IP.

How about Singaporeans who could not afford? Despite best effort, some Singaporeans still could not afford to pay the MediShield Life premiums. How could we help them? Please allow me to elaborate my thoughts in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] First, I would like to thank the MediShield Life Review Committee for their efforts to produce such an excellent report!

This report is not one that recommends robbing the rich to help the poor. However, one of the Committee's recommendations indicates that wealthy Singaporeans who stay in expensive apartments/houses or have high income should not enjoy permanent premium subsidies. This is unlike the Pioneer Generation Package whereby all Pioneers can enjoy the same subsidies, regardless of being rich or poor. When the report was released, it is not surprising that retirees who live in big houses and upper-middle class families who have more than two maids cry foul that it is not fair. However, Singaporeans need to understand that the Government has already provided some forms of subsidies for MediShield Life.

Let us use as an example a typical family of four; parents in their 40s with two teenage children. The family's annual MediShield Life premiums will be $1,130, without any permanent or transitional premium subsidies. If the family belongs to the low-income category, they only need to pay $806, meaning a 40% subsidy of $324. For a relatively well-off family, the subsidy of $324 a year is not a big sum. For a low-income family who cannot even afford the premiums, $324 is a substantial amount. Therefore, it makes sense to adhere

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to the principle that the lessser a person earns, the more subsidies he deserves.

The Committee estimated that one-third of Singaporeans will not receive permanent premium subsidies. However, there might be people who need subsidies but, for some technical reasons, cannot qualify. The Minister has promised that the Government will give special considerations to such cases. More importantly, there are Singaporeans who either have no job or their job is unstable. These people have more pressing needs. The Minister for Manpower shared just now that, every year, among CPF members who turn 55, 23% are inactive. Among them are housewives and people who either have no job or their job is unstable.

The Minister did not say how the Government is going to collect the premiums from Singaporeans who do not have sufficient money in their Medisave account. For this group of people, will the Government deduct the premiums from their Ordinary Account first before siphoning money from their Special and Retirement Account? Will the Government ask them to use cash to pay the premiums as the last resort? For those people who have money in their savings account but refuse to pay the premiums, will the Government put pressure on them and even impose penalties?

The Minister has said repeatedly that MOH would use Medifund or some similar scheme to help those who cannot afford the premiums. I hope the Minister can show compassion to help them as long as they do not have sufficient savings in their Medisave account and do not have any family support. There is no point forcing the poor to pay the premiums when they cannot afford.

(In English): In conclusion, I believe that MediShield Life will be a game-changer. I believe that MediShield Life, if implemented well, means that all Singaporeans can afford the basic healthcare. I believe that MediShield Life means – Government cares. With that, I support the Motion.

Mr Deputy Speaker, I welcome the move to improve protection against large hospital bills and against expensive chronic treatments, as well as to cover those with pre-existing conditions. My colleagues have touched on and will be touching on various aspects of MediShield Life. I wish to speak today about keeping healthcare costs manageable.

The Committee reported that in the recent five years, our total healthcare spending has risen close to 10% each year on average. Medical inflation has been rising much faster than

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inflation in general. The healthcare industry has little incentive in itself to contain costs. If this medical inflation trend continues, it can be worrying as to how much MediShield Life's premiums will be in future, as well as the cost of smaller medical bills which are not covered by MediShield Life.

The report touched on some areas that the Government can look into to contain costs. First, I would like to understand how we can keep claims reasonable. I would like to see a robust framework to detect inflated claims or frivolous treatments by healthcare professionals. Inflated claims can come in the form of prescribing treatments beyond what the patients need or from the over prescription of drugs. How will the Government track claims to ensure that even as we strengthen our insurance framework, we will not have inflated claims and unnecessary treatments that will push up healthcare costs, as we have seen that happening in some other countries?

Another way to keep costs manageable is for people to stay healthy. That is easier said than done. Many people in Singapore today are already not healthy, being diagnosed with various chronic illnesses. For example, 11.3% of Singaporean adults are diabetic. One in three people are diabetic by the age of 70. A recent study by NUS' Saw Swee Hock School of Public Health forecasted that by 2050, Singapore may have as many as one million diabetics, with one in two being diabetic by the age of 70. Around 24% of adults in Singapore now have high blood pressure or hypertension. What is needed will be to prevent those with chronic illnesses from developing complications. Diabetes itself may not be scary, but it can lead to kidney failure, or the patient becoming blind or needing amputation. A person with high blood pressure may feel healthy, but the ailment can develop into stroke or a heart attack if the situation is not controlled.

Our lifestyles are increasingly becoming unhealthy. We can put more effort to focus on those who are already diagnosed as unhealthy and invest in preventive care for them. We need to give the best care possible and to monitor the proper taking of medication to prevent complications from developing, which can be life-threatening and are very costly to treat.

While we currently already have schemes like CHAS and various subsidies for medicines, it is frightening to note that we are currently having four new cases of kidney failures every day and two cases of limb amputations are performed each day due to diabetic foot complications. We should constantly monitor the schemes to see how they are working and what else we can do if the results are not as good as what we want them to be.

Drugs are another area for cost control. I am concerned about the potential impact that the Trans-Pacific Partnership Agreement (TPP) may have on the cost of drugs. TPP is currently being negotiated among 12 countries which include Singapore. Many negotiating

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countries have raised concerns about the Intellectual Property (IP) rights chapter in the TPP which reportedly seeks a much more stringent level of IP protection than the World Trade Organization (WTO) standards. Fears are that these new rules will strengthen the drug monopoly of big US pharmaceutical companies by altering existing patent laws in their favour. The Committee has recommended using generic drugs as far as possible to lower costs. We need to guard against the TPP drastically changing IP rules that may delay drugs becoming generic.

Next, on electronic health records. I believe information transparency will allow the Government to monitor the performance of healthcare providers and to track if appropriate and cost effective treatments are provided. Readily available comprehensive medical data will allow the Government to better manage cost across the entire healthcare sector. This is especially so for the private sector. The Committee had highlighted concerns about "high professional fees" in the private sector.

Some 10 years ago, MOH made it as one of its priorities for the healthcare sector to adopt ICT for health and to set up a common Electronic Medical Record system. Much has been invested in the National Electronic Health Record system (NEHR), and international experts have been brought in to help implement the system. I understand that, today, a version of the system is used in the public healthcare sector. However, the vast majority of those in the private healthcare sector and those run by VWOs are not yet adopting the system.

For NEHR to help better manage the industry efficiently and effectively, I think it will be necessary to have the private sector and VWO providers adopt the NEHR system as well. We should have all healthcare providers on board the same system. This will let patients have the choice to move on to other healthcare providers with full portability of records. The information will also allow the Government to measure the performances of healthcare providers and, if necessary, to even effect changes to payment models, such as to pay for health outcomes rather than just to pay for treatments. I would like to know if there are timelines in place for NEHR to be used industry-wide.

Healthcare has been a laggard in the exploitation of ICT. As we move to provide wider healthcare coverage for all Singaporeans through MediShield Life, how will NEHR play a role in providing more efficient healthcare?

Also on technology, telehealth or telemedicine offers opportunities to enable the diagnosis, consultation, treatment, education, care management and self-management of patients remotely. Telehealth can include the home monitoring of chronic diseases, time-sensitive assessments in accident and emergency (A&E) departments by medical specialists in another hospital, video conferencing between patients and healthcare providers, and

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store-and-forward technologies, such as for X-rays and photographs to be captured and transmitted for analysis by doctors later and remotely.

Expanding the use of telehealth has the potential to reduce healthcare costs, increase the level of convenience for patients and to improve patient outcomes over traditional methods. Home monitoring of chronic diseases has been shown to lead to reduced hospitalisations. A patient in the A&E department, for example, can receive care by video conferencing with a specialist in another hospital and, thus, may save a transfer to that hospital. Telehealth can provide timely care for stroke patients who may have difficulties travelling to hospitals.

I understand that telehealth is currently being piloted in Singapore. We will need to move to an agreed-upon reimbursement model. If doctors cannot be compensated for tele-consultations, they will likely fall back on the traditional mode of getting patients to visit them in their clinics. If patients cannot use Medisave or be covered by insurance for telehealth, they may opt not to have telehealth even if it can be more suitable for them. I would like to see greater adoption of telehealth through better infrastructure and changes to reimbursement models or regulations that inhibit telehealth.

Finally, the Committee has recommended that the Government build up capabilities to evaluate the cost-effectiveness of medical practices, technologies and drugs. I wish to understand what measures the Government has put in place to ensure that new practices, technologies and therapies that are cost-effective in achieving a good treatment outcome are covered by Medishield Life. What will be the measures used to define cost effectiveness? What will be the frequency of such evaluation so that good treatment methods can be covered as soon as practical?

Will there be a formal institution that will be set up to make these decisions in a transparent manner and to evaluate appeal on decisions? For example, in the United Kingdom, the National Institute for Health and Clinical Excellence (NICE) is government-funded and exercises independent and binding decision-making on what the health services need to offer. Crucial to the Institution's independence is its transparency in decision-making. The academic research, industry output, patient advocates' filing, demographic and epidemiologic data that go into the decision-making process are freely available.

In conclusion, MediShield Life is a step in the right direction to ease the worries of Singaporeans on large healthcare bills. I hope the Government will examine all ways possible to contain healthcare inflation so that healthcare will be affordable to all. Mr Deputy Speaker, I support the Motion.

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I will keep it short and sharp. Mr Deputy Speaker, Singaporeans are worried about the rising cost of healthcare. This impact is felt when Singaporeans are suddenly diagnosed with serious illnesses and, even with insurance coverage, the medical fees erode a significant portion of their savings. Those who are not covered by the medical insurance are even worse off.

The comprehensive report by the MediShield Life Review Committee is timely and I am heartened that the Government is introducing enhancements to healthcare in Singapore and will be implementing the MediShield Life scheme by end of 2015. Singaporeans can now look forward to these enhancements, which will allay their concerns on the affordability of healthcare in Singapore.

It is comforting to know that Singaporeans with prior medical history of pre-existing illnesses and not previously covered under MediShield, will now be insured. Seniors can also now have peace of mind to enjoy their golden years as well.

The Labour Movement also welcomes the recommendations to raise claim limits and lowering co-insurance rates, previously at 10% to 20%, to now 3% to 10%. This will certainly help our workers contain the out-of-pocket expenses for exorbitant medical bills.

Sir, however, there are a few concerns that I would like to raise. Firstly, while the recommendations will substantially reduce the costs of large hospital and medical bills for most Singaporeans through the reduced co-payments, the deductibles and the Medisave, it is still inevitable that new medical treatments, technology and prescriptions will contribute towards the escalation of medical bills. This means that the possibility of Singaporeans having to incur out-of-pocket expenses for medical treatments remains a reality.

In implementing MediShield Life, will the Government also consider implementing an annual cap on the out-of-pocket payments incurred by Singaporeans? This is to ensure that only necessary procedures are prescribed to patients. In addition, what more can the Government do to give assurance and peace of mind to Singaporeans that the cost of premiums will not escalate after five years?

Secondly, MediShield Life is very much all-encompassing and the Labour Movement is concerned about resource wastage and the duplication of medical insurance coverage for

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Singaporeans.

It is in the interests of the employers to minimise these areas of duplication and to optimise the money spent on medical insurance.

Employers should not choose the easy path of shifting their responsibility for their employees' health and well-being by channelling the burden of medical care back to the Government and, ultimately, to taxpayers.

In the interests of employees, we hope that employers will consider reallocating their budgets set aside for group insurance premiums to provide portable medical benefits that ride on MediShield Life that provides even higher insurance coverage and hospital stays in higher ward classes. By diverting this budget to MediShield Life, the benefits stay with the employees.

Portable medical benefits go towards being a benefit for both the employers and the workers. The employers are able to offer better medical insurance coverage for the workers, which is an added incentive for employment in our tight labour market. Correspondingly, our workers will still get to enjoy the insurance coverage when they are no longer with the employer, either by choice when they leave, or in unfortunate circumstances when they are retrenched.

Will the Government consider encouraging employers to adopt the implementation of portable medical benefits, either through additional tax exemptions or other incentives?

Thirdly, while the elderly and the lower income workers have subsidies to help them afford the premiums, I am concerned for another group in our community. These are our non-working mothers who toil day and night on a full-time basis taking care of their children so that their husbands can pursue their careers with greater peace of mind. Most non-working mothers have no income or not much CPF savings and may not have enough to pay for the MediShield Life premiums, especially as they age. Likewise, for the single parent, who has to juggle the responsibility of raising their children and working to support themselves and their children.

Can the Government provide assistance to non-working mothers and struggling single parents who are unable to keep up with the higher MediShield Life premium payments?

Lastly, while MediShield Life serves to address medical cost, we must not underestimate the role a healthy lifestyle plays in the prevention of critical illnesses. It is an individual responsibility of every Singaporean to take care of our health. Many Members of the House

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have said this eloquently earlier. Staying healthy is being a responsible Singaporean. We do not want to be a burden to our family members and future generations.

The Government has, through the Health Promotion Board (HPB), done well thus far with many initiatives to promote healthy living and lifestyle. Can the Government elaborate on the effective reach of the HPB initiatives introduced? Will the HPB be undertaking more efforts to promote healthy living to keep health a priority in the minds of Singaporeans?

In conclusion, while policies are implemented with good intentions and since MediShield Life is here to stay, can the Government take the time to clearly explain the scheme and policy to all Singaporeans, so that they can understand MediShield Life and know how they can now have access to affordable medical care?

With these comments, Sir, I support the introduction and recommendations of MediShield Life.

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