MediShield Life Scheme Bill

Order for Second Reading read.

1.31 pm

The Minister for Health (Mr Gan Kim Yong): Mdm Speaker, I beg to move, "That the Bill be now read a Second time."

Madam, Prime Minister Lee announced in August 2013 during the National Day Rally that MediShield would be enhanced and renamed MediShield Life. This marks a significant shift in healthcare financing towards greater collective responsibility to give Singaporeans better peace of mind so that they need not face life's uncertainties alone.

This strategic shift is in line with the Healthcare 2020 Master Plan to keep healthcare accessible, affordable and sustainable over the long term. It is also a response to the feedback received during Our Singapore Conversation that Singaporeans want to come together as a community and nation, to better support the more vulnerable and needy, especially those who meet with unexpected shocks in their life journeys.

The MediShield Life Review Committee headed by Mr Bobby Chin was set up in November 2013 to review and make recommendations on the MediShield Life Scheme design and parameters, taking into account feedback from the public and key stakeholders.

After eight months of extensive public consultation and intensive study, the Committee submitted its report to the Government and the White Paper on the "MediShield Life Review Committee Report" was debated in Parliament in July last year. I am pleased that it received unanimous support from Members of this House.

As recommended by the Committee, MediShield Life will provide every Singaporean with better and lifelong protection against unexpectedly high medical bills, regardless of changes in their life or health circumstances. The key recommended enhancements include: (a) removal of the lifetime claim limit so that it will provide life-long protection; (b) increase the policy year and daily claim limits so that it will cover more; and (c) reduce co-insurance rate so that patients pay less especially for larger bills.

The Committee also recommended that MediShield Life should be universal for all Singaporeans with no exemption but appealed for the Government to bear the bulk of the cost of bringing those with pre-existing conditions under MediShield Life, and to provide the support needed to keep premiums affordable, especially for the vulnerable groups.

The Ministry of Health (MOH) has been preparing for the introduction of the MediShield Life Scheme and this Bill will provide the legislative framework for the establishment, governance and administration of the Scheme.

Mdm Speaker, I shall now highlight the main features of the MediShield Life Scheme Bill.

First, clause 3 of the Bill provides for the establishment of the MediShield Life Scheme and for the transition from MediShield to MediShield Life. It also provides for the Scheme to be administered by the CPF Board.

Clause 7 of the Bill provides for the current MediShield Fund to be renamed the MediShield Life Fund, and that all payments under the Scheme are to be met from the Fund. CPF Board, as the administrator for MediShield Life, is not liable for payments under the Scheme, and therefore cannot use other monies that it holds to meet the obligations under the Scheme.

In short, the MediShield Life Fund is to be a self-sustaining insurance fund supported by premiums it collects. All of us contribute to the Fund. Those who fall seriously ill get payouts from the Fund. This is the spirit of collective responsibility, but with strong support from the Government.

Up to two-thirds of the population are eligible for Premium Subsidies of up to 50%. Premium Subsidies are a permanent feature of the Scheme – which means that these subsidies will continue to be extended to Singaporeans who meet the criteria and will not be phased out over time.

Clause 8 of the Bill provides for the establishment of a MediShield Life Council, comprising up to 17 members. We have benefited much from the wide-ranging experience and professional expertise of the members of the MediShield Life Review Committee. I am confident that we will also benefit from the advice and guidance of the MediShield Life Council in the implementation and administration of the Scheme. The key roles of the Council are outlined in clause 8 of the Bill.

The Council will review the design of MediShield Life Scheme benefits and parameters regularly, consider appeals for Additional Premium Support, and decide on the approach and guidelines for the recovery of outstanding premiums.

The Council will be established by the time the Scheme takes effect. We are working through the details of setting up the Council and will release more information later.

Let me now turn to the issue of universal coverage under MediShield Life and the approach for bringing in those with pre-existing medical conditions.

The MediShield Life Review Committee consulted extensively on the issue of universal coverage. The vast majority of Singaporeans strongly supported bringing the uninsured, including those with pre-existing medical conditions, under MediShield Life. Many saw this as part of the move towards a more inclusive society. This will reduce the financial burden on these individuals by spreading the costs more evenly across the population. This is also aligned with views gathered from Our Singapore Conversation where Singaporeans expressed support for greater collective responsibility to help one another with unexpectedly large hospital bills.

Clause 3 of the Bill provides for the MediShield Life Scheme to apply to all Singapore Citizens and Permanent Residents (PRs). This enables those who are currently uninsured and those with pre-existing medical conditions to benefit from MediShield Life coverage. However, this also means that the Scheme will face higher costs, given the higher risks of these groups.

As noted by the Review Committee, while it would be fair that those with pre-existing medical conditions pay higher premiums to reflect the higher risks, we also need to ensure that the Additional Premiums would not be too onerous. On balance, the Review Committee recommended that: the Government bears the bulk of the costs of bringing in individuals with pre-existing medical conditions; these individuals with pre-existing medical conditions shoulder part of the costs by paying Additional Premiums of 30% for the first 10 years; and the rest of Singaporeans co-share a modest part in the spirit of collective responsibility.

Under the Scheme, a pre-existing medical condition is one that has already developed before an individual's insurance coverage begins. Those who fall ill only after their insurance coverage begins will not be considered to have pre-existing medical conditions and will therefore not need to pay Additional Premiums.

MOH is currently reviewing the list of serious pre-existing medical conditions, with specialist advice from clinicians, and will share more on the broad categories of such conditions later. Individuals who have to pay the Additional Premiums will be informed before the start of the Scheme.

I wish to assure Members and the public that we will adopt a fair and compassionate approach in the assessment for Additional Premiums. The key focus would be on serious pre-existing medical conditions that are likely to be life threatening or have high risk of future complications or recurrence, and therefore may require prolonged treatment. Singaporeans with these conditions will benefit significantly from the enhanced protection when they are covered under MediShield Life, as many of them would not have been able to get insurance coverage for their pre-existing medical conditions in the past.

Madam, having a serious medical condition is worry enough. Therefore, we want to make the process of identifying such individuals a more convenient one. Part 5 of the Bill allows MOH and CPF Board to do so by accessing individuals' information already existing in Government administrative databases and medical institutions. We hope that, through this, the majority will avoid having to undergo medical assessments or provide medical reports.

We understand that some Singaporeans may not be comfortable with us accessing their medical information. They may choose to decline MOH and CPF Board access to their medical information. However, if they do so, we will not be able to ascertain that they do not have pre-existing medical conditions and, therefore, they will have to pay the Additional Premiums under MediShield Life. Notwithstanding, they can submit the necessary medical reports and documentary evidence to certify that they do not have any pre-existing medical conditions or if they change their minds later, they can consent to the access of their medical information.

Mdm Speaker, let me now move on to MediShield Life premiums and payments.

With the significant benefit enhancements and provision of universal coverage under MediShield Life, premiums will have to increase to support the higher payouts. However, premiums will remain affordable for all Singaporeans through a variety of measures.

First, the Government will provide strong support in the form of various subsidies and support measures, to help Singaporeans with MediShield Life premiums.

For lower- to middle-income households, they will be able to benefit from MediShield Life Premium Subsidies. The eligibility criteria for the Premium Subsidies will be based on household monthly income per person and the Annual Value of one's residence. MOH will also take into account multiple property ownership, to better reflect the individual's financial circumstances, similar to the approach for other Government schemes such as the GST-Voucher (U-Save) Scheme.

Besides Premium Subsidies, the Government has also announced special subsidies and Medisave top-ups for all Pioneers. With these subsidies and top-ups, all Pioneers will pay less for their MediShield Life premiums than they would otherwise have to.

The Government will also provide Transitional Subsidies for all Singapore Citizens over four years, to help ease the shift from MediShield to MediShield Life.

Second, Medisave may be used to pay the full MediShield Life premiums. For the 94% of Singaporeans who are already covered under MediShield today, including those who bought Integrated Shield Plans, their existing Medisave payment arrangements will be retained. For those who wish to have another immediate family member to help with premium payments, they can request the Board to do so. These Medisave payment arrangements will be provided for under clause 4 of the Bill.

For children below the age of 21, clause 4 further provides for their premiums to be borne by their parents. Citizen babies born after 2012 can tap on the $3,000 Medisave grant under the Marriage and Parenthood Package to help pay for their premiums.

The one percentage point increase in employers' CPF contribution to Medisave accounts this year will also help to cover the increase in MediShield Life premiums for most Singaporean households.

For needy Singaporeans who need further help with their premiums even after these subsidies and support measures, the Government will provide Additional Premium Support on a case-by-case basis for their premiums.

Mdm Speaker, Premium Subsidies and support are a key feature of the MediShield Life Scheme.

The MediShield Life Review Committee recommended that the process of applying for subsidies should be as simple and convenient as possible so that those who need them will receive them. Many Singaporeans have also suggested that we simplify the application process to reduce the need to provide similar information to different agencies repeatedly.

Therefore, Part 5 of the Bill allows MOH to do so by using individuals' information in Government databases, to check and compute Premium Subsidies for each individual. These facilitated eligibility checks will ensure that eligible Singaporeans are able to access MediShield Life Premium Subsidies as conveniently as possible, without having to apply individually and submit supporting documents.

While MOH will do our best to use the latest information, the outcome of the facilitated eligibility checks depends on information in the Government databases being up to date. We all know in our interactions with other Singaporeans that some Singaporeans may not have updated their NRIC addresses after moving to a new address. Some who have rented out their flats may not have updated their tenants' particulars as well. So, to help us compute your subsidy eligibility, we urge individuals to do their part by checking and updating their records.

Similar to the access to medical information, Singaporeans may choose not to participate in the facilitated eligibility checks so that the Ministry of Health and CPF Board will not access their information, but this means that they will not receive any Premium Subsidies as we will not be able to assess their eligibility. However, if you do change your mind subsequently, you can still apply later to be assessed.

I would like to assure Members that stringent safeguards are in place to protect the information from unintended or inappropriate use. First, only authorised persons will be allowed to access, use or disclose medical and financial information for specified purposes. They will be required to sign appropriate undertakings. Second, the Minister in charge of the agency that controls the information requested will have to approve the disclosure of that information and can impose appropriate terms and conditions. Third, clause 29 of the Bill makes it an offence for any person to access, use or disclose information about an individual obtained under Part 5 of the Bill without authorisation or the written consent of the individual concerned. Offenders may be punished with a fine of up to $5,000 or imprisonment of up to 12 months, or both.

Mdm Speaker, let me now address the issue of premium payments and recovery measures for the MediShield Life Scheme.

As MediShield Life is a universal and self-sustaining scheme, all citizens and PRs must play their part in paying their premiums on time, to ensure that the Scheme can continue to pay out the benefits and meet its commitments. To facilitate and assist Singaporeans in paying their premiums, a comprehensive framework of measures will be put in place, in addition to the subsidies and support I mentioned earlier.

First, we will facilitate the process for other immediate family members to pay for your MediShield Life premiums if you do not have sufficient Medisave balance.

Second, for those who have missed premium payments due to insufficient Medisave balances, we will send regular reminder letters to alert them to top up their Medisave and to make use of alternative payment modes available.

Third, we recognise that there may be some who need further help with their premiums even after Premium and Transitional Subsidies. Some may not be aware of the help available or how to access it. We will put in place measures to help the vulnerable to ensure that those who are needy will receive help.

However, there may be a small group who refuse to pay their premiums, despite multiple notices and reminders, even though they have the means to do so. Their premium defaults will translate to bad debts to the MediShield Life Fund and lead to higher premiums for all Singaporeans.

The MediShield Life Review Committee had noted this and recommended that the Government adopt appropriate premium recovery measures and penalty to ensure social responsibility in the payment of premiums.

Let me emphasise that the premium recovery framework and penalty are directed at this small group of freeloaders who are wilful defaulters and do not contribute their share, even though they can afford to. It is necessary to have a set of firm measures in place to deter defaults and uphold the spirit of collective responsibility behind MediShield Life. This will ensure that the MediShield Life Fund remains sustainable and can meet its commitments to all Singaporeans. It also ensures that the debts of these freeloaders will not be unfairly shouldered by those who have paid their share responsibly.

This is similar to other countries with mandatory national insurance schemes which have also adopted strict enforcement measures, to ensure compliance and recover outstanding premiums.

Part 3 of the Bill provides for a robust premium recovery framework, with powers adapted from the existing income tax legislation. Whether it is MediShield Life premiums or taxes, they rely on the same principle of collective responsibility and there is a need to take a firm stance against those who are able to but refuse to play their part.

Clause 12 empowers a recovery body to appoint defaulters' agents such as banks and employers who can be required to pay defaulters' outstanding premiums from the defaulters' savings and salaries respectively.

If necessary, the recovery body may prevent those with outstanding premiums from leaving the country without paying them, as provided for in clause 16 of the Bill. Those who are notified about such a direction from the recovery body and yet choose to violate the direction will be committing an offence punishable with fine or imprisonment or both.

Clause 17 allows the recovery body to impose a penalty, not exceeding 17%, on outstanding premiums and any interest imposed on the outstanding premiums. This is aligned with the maximum penalty of 17% for income tax arrears. Let me clarify that the 17% is not a recurrent penalty. It is the total maximum penalty that can be imposed on a year's outstanding premiums. It acts as a deterrent for delaying payment and will go towards covering the enforcement costs of recovering premiums. Clause 11 allows interest to be imposed on outstanding premiums. This interest is not a penalty but to fairly reflect the opportunity cost to the MediShield Life Fund, which could have earned a return from investing the premiums to support payments from the Fund.

I assure Members that we will exercise discretion and impose interest and take the various recovery measures only in appropriate circumstances, when the defaulters wilfully refuse to pay their premiums despite multiple reminders and attempts to contact them and to help them over an extended period of time. The MediShield Life Council will provide direction on the broad approach towards premium recovery.

I would also like to clarify that late payment of premiums will not be a criminal offence.

IRAS and the CPF Board will be appointed as recovery bodies to help ensure that premium payment is made in a timely manner. This enables the Scheme to tap on their expertise and resources in administering these measures in an effective and sensitive manner.

Madam, let me conclude. MediShield Life is a major step to strengthen collective responsibility and give Singaporeans peace of mind. We discussed at length during the Parliamentary debate last year on issues ranging from the benefit features and premium affordability to Fund sustainability. The debate concluded with unanimous support for this significant shift in healthcare financing. We are taking another step now to make this a reality. The MediShield Life Scheme Bill will provide the legislative framework for this shift to take place and for the implementation and administration of the Scheme.

MediShield Life is a complex Scheme. We will step up our outreach efforts to explain the benefits of MediShield Life, how Singaporeans can receive subsidies and support for premium payments and to explain the effects of the Act.

Madam, the idea of MediShield Life goes beyond healthcare and insurance. It is in fact a reflection of the kind of society we want to build; a more inclusive society where we pool our resources together to help the vulnerable and the sick among us. And a more caring and progressive society, where those who are able play their part while those who are needy will receive more help. This MediShield Life Scheme Bill sets the framework not only for the introduction of universal coverage for all, but also for every Singaporean to play a part in nurturing an inclusive, caring and progressive society. Mdm Speaker, I beg to move.

Question proposed.

1.55 pm

Dr Chia Shi-Lu (Tanjong Pagar): Mdm Speaker, for a young nation such as ours, just now maturing gracefully into our 50th year of independent existence, we should be justifiably proud of what we have achieved in terms of safeguarding the health of our citizens. In terms of health outcomes, no matter what measure you look at, in many independent surveys around the world, Singapore has always ranked quite high. So, by any measure, we are a nation of healthy people. But healthy people do and can fall ill and, sometimes, they fall ill very seriously indeed. When this happens, this is where MediShield Life or any form of medical insurance steps in.

MediShield Life represents another significant step towards ensuring that Singaporeans have continued assurances with regard to their medical needs, specifically in the unfortunate event when they face a major illness. I warmly support this Bill, as I have done when the Scheme was first mooted and was later debated in Parliament last year.

I do have three areas with regard to this Bill for comment, consideration and clarification.

The first actually concerns the scheme itself rather than the Bill specifically and return to some lingering concerns about premium affordability. We appreciate the raft of measures to health affordability that the MediShield Review Council and later the Ministry of Health (MOH) has adopted, and which has just been detailed by the Minister in his opening speech earlier.

There are the Pioneer Generation subsidies and grants for our Pioneers. Aside from these, there is a further $4 billion being set aside for financial assistance, particularly for those with low income and who are in particularly vulnerable positions.

All Singaporeans, as I understand, will also benefit from Premium Subsidies for the first few years after the roll out of MediShield Life, so as to allow time to adapt to the moderate increases in premiums from the Basic MediShield. It is also reassuring to note that most Singaporeans will be able to pay for their premiums completely from their Medisave accounts alone.

Nonetheless, I do not think it would be unreasonable for us to ask the Ministry and the Government to consider expanding or increasing these subsidies, particularly for the vulnerable groups. And also for the majority of all other Singaporeans, I hope that the Transitional Subsidies Scheme can perhaps be looked at and extended beyond the first five years and perhaps even increased as this would soften the transition further for Singaporeans as they ease from MediShield to the universal scheme which is MediShield Life.

My second concern concerns the change from the MediShield or the Basic MediShield system to a universal single payer national insurance health scheme. Notwithstanding the availability of integrated plans by various private insurers, this represents a pivotal shift in the way healthcare is delivered and paid for in Singapore.

And although Singapore is well poised for this change as most Singaporeans already have MediShield and have MediShield accounts, from which they can service their premiums, the sustainability and affordability of such an ambitious scheme as MediShield Life will come under increasing pressure in the years to come, as our population grows older and our tax base shrinks, and also when medical technology becomes more expensive and perhaps if demand surges.

Our Government Parliamentary Committee (GPC) for Health has previously raised this issue about a need to more rigorously evaluate medical treatments and technologies, so that we can better control costs, and this perhaps can be better facilitated when we have a single payer system such as MediShield Life. In healthcare, as it is in many other aspects of life, expensive does not always mean better.

As a doctor in Government practice myself, I find that some patients still feel suspicious or short-changed when they are given a medication which they feel is significantly less expensive than what they feel it should be. Often, this can be easily explained because of Government subsidies or because the patent for the original drug has expired, or perhaps a cheaper but better drug has been found.

Another example is that of patients requesting for complex scans when the need is not supported by medical evidence, or asking for the newest procedure when older ones are measurably more effective, more reliable and more affordable. This is as much a challenge of public perception as anything else, but it is a reality and it will, nonetheless, continue to put pressure on healthcare providers and subsequently upward pressure on medical costs.

Hence, I hope that the Minister could clarify a little bit further – I know he has already done so – on the roles and functions of the MediShield Life Council, as defined in clause 8 of the Bill. I understand that the Council will advise the Ministry on the parameters of coverage, and I hope that there will be robust mechanisms to evaluate what treatments are deserving of coverage, regardless of how much it costs. This ability to determine which treatment is allowed under the Scheme is already stipulated, as I note under clause 34(c) of the Bill.

What I am advocating is that whether a treatment is covered by the Scheme should be based on scientific merit and, if this treatment is actually effective, then the Scheme should endeavour to cover it, regardless of the cost. The strong safeguards that we need are necessary to guard against this moral hazard of over-consumption, whether it is from the demand side by patients, or from the supply side by healthcare providers.

My final point of clarification is a short one. I do know of many elderly residents, most of whom are Pioneers, who have never been covered under any medical insurance scheme and also have incomplete medical records. These residents or these citizens may sometimes encounter challenges going for a thorough medical review. I would like to seek clarification that these citizens can be automatically included in the scheme with the assumption that they have no pre-existing illnesses.

Finally, I would like to conclude with just a brief comment on what MediShield Life does not cover. While improvements in coverage for outpatient cancer treatment and also for kidney dialysis are very welcome indeed, various aspects of intermediate and long-term care still face challenges in financing. As raised on previous occasions, our ElderShield system is still limited in its benefits in terms of its scope and schedule, and I hope that the Ministry will continue to look into these areas, beyond MediShield Life, since there is a continuum of care from the hospital all the way back to the community.

MediShield Life is, indeed, many things; it is many good things, but it is not about abrogating our individual responsibility for our own health and the health of our loved ones, it is not about the complete freedom to utilise health services as we choose. But what it is about is to afford us peace of mind so that even as we take positive steps to safeguard our health, should a medical catastrophe strike us or our loved ones, then we can be assured that we will have the medical treatment that we need, regardless of our circumstances, young or old. With that, I support the Bill.

2.03 pm

Ms Tin Pei Ling (Marine Parade): Mdm Speaker, I had spoken in this House last year during the debate on MediShield Life White Paper and voiced my support for it. As such, I am pleased that this Bill is now before us in this House for Second Reading, another step towards realising universal public health insurance in Singapore.

During my speech on the MediShield Life White Paper in July last year, I highlighted the need for affordable healthcare for all and how important it is for Singaporeans to collectively take care of one another as a show of national solidarity, on top of the 3M public healthcare financing system we have in Singapore. I had also described MediShield Life as a bold scheme and cautioned about the need to ensure its sustainability, given the significant and permanent financial commitments by both Singaporeans and the Government. Experiences by other countries such as Canada, US, Europe, Australia and Taiwan offered invaluable lessons on how the government's strong fiscal positions and people's conscientious premium contributions are important in sustaining a universal public health insurance scheme. Such a scheme brings great social good but if it cannot be sustained, then it will be a shame.

Therefore, I am pleased that the MOH has committed a significant and no doubt calibrated budget to provide various subsidies for Singaporeans, including permanent special subsidies for our Pioneers and additional Premium Subsidies for Singaporean households who may be facing financial difficulties. These subsidies help to relieve the financial burden from the expected rise in premiums and they would not have been possible without a strong fiscal position.

I also note that this Bill has set out penalties for those who wilfully defaulted on their premium payments. At first glance, the penalties appear harsh and some may even interpret it as the Government being gian lui (greedy for money). However, I do think otherwise as I believe it is just as important to put in place a mechanism to ensure that financially capable policyholders play their role and contribute. It is important for Singaporeans to pool our risks and take care of each other collectively. All Singaporeans contributing to the pool is a tangible action and demonstration of our strong sense of national solidarity and willingness to help our fellow countrymen. It is, to me, a test of our conviction towards building a caring and inclusive society. Therefore, while the Government should and can take on a large share of the healthcare financial burden, all of us still have a role to play. It is in this spirit that I agree to the need for penalties to be imposed on wilful recalcitrant defaulters and I stress "wilful recalcitrant defaulters".

However, I do have some clarifications to seek on this.

There may be some members who have insufficient Medisave savings, likely self-employed and, for some reason, are too busy with work or have to travel overseas frequently. Hence, they may inadvertently have missed the premium payment notices sent to them. As such, I would like to ask the Minister how will MOH identify and decide if someone is a wilful defaulter? What parameters, specifically, will be used to define a wilful defaulter? If the member delays the payment beyond 90 days but shows reasonable effort to pay once he or she can, will the MOH give him or her, a second chance? While it is important to ensure that wilful defaulters do their part, I am also cognisant of the need to avoid penalties on Singaporeans who just need a little more time. Mdm Speaker, please allow me to continue in Mandarin.

( In Mandarin ) : [Please refer to Vernacular Speech.] Mdm Speaker, the Pioneer Generation Package introduced by the Government last year is warmly welcomed. Our pioneers are deeply relieved because the Package is a great help to reduce their medical expenses, especially for those who have not had income after retirement. The Pioneer Generation Package has eased their hesitation to see a doctor because of cost concerns. It is truly commendable.

Today's debate is on the MediShield Life. I have a few questions.

For those aged between 75 and 79 at 2014, they can receive a subsidy of $600 Medisave top-ups every year. This subsidy, together with the special premium subsidy under the Package, can fully pay for their annual MediShield Life premium until they are 83. This means that for quite a number of years, they do not have to pay anything out of their own pocket. But when they reach 83, they will suddenly find the need to pay for the additional premiums on their own, which can cause confusion. Besides, retirees will have less Medisave savings and cash as they get older. Some of them may have already exhausted their Medisave. I would like to ask the following questions.

First, among this group of Pioneers, how many are likely to be in this situation? Second, for these Pioneers who have financial difficulties, will the Government automatically give them additional subsidies so that they can continue to be insured and will not be worried about getting a ‘red slip'? This also applies to the Pioneers who are slightly younger than this age group and who may face a similar situation. Third, will the Government consider allowing this group of Pioneers, namely those aged between 75 and 79 last year, to be exempted from paying premiums altogether. After all, the difference between their Medisave subsidies and the premiums they have to pay is about $12 to $15 only.

( In English ): Mdm Speaker, in conclusion, I believe MediShield Life marks an important milestone in our public healthcare landscape. It helps Singaporeans to pool risks, share resources and defray large healthcare expenses. While helping to keep public healthcare affordable for all, it is also a tangible way for Singaporeans to demonstrate our solidarity as a nation and our conviction to building a caring and inclusive society. Hence, notwithstanding the questions I have raised, I fully support this Bill.

2.10 pm

Mr Gerald Giam Yean Song (Non-Constituency Member): Mdm Speaker, this Bill gives effect to the MediShield Life Scheme, which was debated in this House in July 2014. It spells out the framework for the disclosure of an individual's confidential health and financial information, recovering outstanding premiums, and the offences and penalties for false declarations and claims.

I have several concerns to raise regarding the disclosure of information and the recovery of outstanding premiums:

First, on the disclosure of information described in Part 5 of the Bill. The Bill authorises certain "authorised persons", including public servants from the Central Provident Fund Board (CPF), the Ministry of Health (MOH) and public hospitals to tap into various Government databases to extract an individual's confidential health information for two purposes: One, to assess whether a person has pre-existing medical conditions for which premium loading may apply; and two, to assess the person's benefit claims under MediShield Life.

The Bill also permits these authorised persons to request for access, use or to disclose to other authorised persons the "means information" of an individual, which could include monthly income, information on assets, residential address and household composition.

My queries and concerns on this Part of the Bill fall into four categories: (1) the means testing process; (2) the extent of access, disclosure and use of confidential data; (3) the process and consequences of opting out; and (4) safeguards to prevent illegal disclosure.

First, on means testing. I understand the rationale for authorising the disclosure of health and means information is to facilitate the smoother and more seamless execution of the MediShield Life Scheme.

I raised the matter of means-tested Premium Subsidies in both my Adjournment Motion on healthcare affordability in November 2013 and during the MediShield Life White Paper debate last July. I had asked for Premium Subsidies to be provided automatically to households that have already undergone means-testing for other Government assistance schemes like the Community Health Assist Scheme ( CHAS ). I also asked for the appropriate level of Premium Subsidies to be automatically extended to all vulnerable groups of Singaporeans, without requiring them to apply separately. This is so that all individuals who are eligible for Premium Subsidies will receive them with minimal paperwork.

Can the Minister confirm if the provisions in this Bill will enable means-testing to be automated, such that individuals do not have to submit any additional forms to receive the Premium Subsidies?

If not, what would be the procedure for individuals to apply for Premium Subsidies, and how will MOH ensure that the process is simple and convenient, especially for the elderly, people with disabilities and those with lower levels of literacy? Given the very tough premium recovery measures in Part 3 of this Bill, it is even more critical that no one misses out on their Premium Subsidies, if they are eligible.

Next, on the use of confidential information. Will the Government be allowed to use any of the confidential information authorised under this Bill for purposes other than means-testing, premium calculations and benefit claims assessments? I note there are provisions under the Bill, including in clause 30, for the Minister to approve the access or disclosure of such information as he "considers appropriate". This gives very broad powers to the Minister and could potentially negate the protections spelt out in other parts of the Bill.

Can the Minister give some examples of what grounds he may consider to be appropriate for granting access or disclosure of confidential information that is not already covered in this Bill? Can these not be spelt out in the Bill instead of giving the Minister so much discretion?

Next, on opting out. For those who do not consent to sharing their confidential information, how will they opt out? Will the process be made simple and explained clearly to all persons, including those who have not yet expressed a desire to opt out? The Bill does not explain the procedure for opting out, but simply that it should be in "the manner determined by the Minister".

If individuals opt out, will they automatically have the full 30% premium load for 10 years imposed on them?

It is easy to assume that people all fall into one of only two groups: the first group being those who are willing to allow the Government to access their health and means information; and the second group, those who have medical conditions that they are trying to hide so as not to attract higher premiums. But there is a third group of individuals, those who have no medical conditions that warrant higher premiums, but still do not wish to give the state such wide-ranging access to their personal information. People in this group should not be penalised for wishing to maintain their privacy, neither should they be forced to make a Hobson's choice: either permit access to your data or pay higher premiums.

For individuals who are concerned about privacy, can the Government allow them to opt out from giving access to their health information, and then make a statutory declaration about their health status? If they declare that they have no relevant medical conditions, they would not be required to pay higher premiums. If they are untruthful in their declarations, then there are already penalties in this Bill and other laws that can be used to punish them and deter such behaviour.

I believe this would strike a fair balance between individuals' desire for privacy and the need to ascertain their health status for premium calculations.

Next, on safeguards. This Bill greatly increases the potential number of persons who will be authorised to access confidential information of individuals. We have seen examples in other countries where public officers who were given wide-ranging access to confidential information misused that information and even disclosed it publicly. We have also seen large organisations have their computer systems breached by hackers and suffer massive losses of confidential information, including health information of their employees or credit card numbers of their customers.

I note that there are penalties in the Bill for unauthorised disclosure. But it is not always easy to track down the source of a leak, and in any case, once confidential information is leaked, the damage would have already been done.

With the introduction in this Bill of such extensive authorisation to access confidential information, do the relevant agencies plan to significantly beef up the security of their computer systems to prevent unauthorised data access, either by external hackers or by disgruntled insiders?

Can the Minister assure us that authorised persons will be given access only on a strictly "need-to-know" basis, regardless of their seniority, and that the data in their possession is removed as soon as it is no longer needed?

I note that a new Cyber Security Agency (CSA) has been set up under the Prime Minister's Office (PMO). Will the security of confidential information covered under this Bill come under the purview of the CSA?

I now move on to Part 3 of the Bill: the recovery of outstanding premiums.

Under the Bill, those who do not pay their premiums could also be slapped with penalties of up to 17% of outstanding premiums and interest on late payments. Can the Minister elaborate on how the penalties will be computed and how soon after a default they will take effect?

The Bill empowers a "recovery body" to use methods of recovery of outstanding premiums similar to that used by the Inland Revenue Authority of Singapore (IRAS) to recover outstanding taxes. These include declaring any person or entity to be a "defaulter's agent", who could be one's employer, bank or tenant. The defaulter's agent will then be obliged to pay the premiums due from any salary, pensions or rent that he owes to the defaulter. Defaulters could also be sued.

I agree with the Minister that those who have the means to pay their premiums but fail to do so should be firmly compelled to do so. This is only fair to other policyholders who are contributing their fair share to ensure that the Scheme is sustainable and viable in the long term. However, can the Minister assure the House that the Government will not aggressively pursue individuals who default due to their genuine inability to pay?

I am not referring to the destitute, who can be helped by Premium Subsidies, but those who may not qualify for Premium Subsidies but still cannot pay, for example, individuals who have lost their jobs or cannot work due to illness. Can the Government allow for premium deferment for such individuals who may have temporarily run into hard times financially?

And lastly, if an individual continues to default on premium payments, will he ever lose his MediShield Life cover? I hope this will not be the case because it will call into question the universal nature of MediShield Life.

In conclusion, Madam, I support this Bill but have expressed a number of concerns about the disclosure of health and financial information, and the enforcement of the measures to recover outstanding premiums. I hope the Minister will address my queries in his round-up speech.

2.20 pm

Mr K Karthikeyan (Nominated Member): Mdm Speaker, in any society, the medical need is the most important benefit that the Government can provide for its citizens.

I must applaud the Ministry for putting forward this Bill. Nevertheless, I have two concerns. Firstly, Singaporeans fear that whenever subsidies are enhanced by our Government, an increase in costs follows on the beneficiary – in this case, hospitals. Ministries should monitor the increase in hospital charges in all restructured hospitals. All cost increases should be justified. Costs should only increase with new technologies introduced or it is really necessary.

Secondly, the Bill has looked at all levels of society – the low-wage workers, the Pioneer Generation and those with financial difficulties. But there are few who may be doing well now and suddenly undergo retrenchment from company and meet many crises. Based on CPF records and others, it may be the middle income who require temporary needs or assistance. Medical social workers should look at his or her present status and try to assist him and should not use his household type or assets and possessions to judge his status.

I know a manager who was retrenched and found out later that he had advanced stage cancer. Medical social workers could not assist him because he stays in a 5-room flat and owns a car. His wife tried desperately to immediately sell the car or the house to continue the payment of medical bills. But it was a bit too late. And he too could not collect his CPF because he was only in his 50s.

I urge the Ministry to brief all medical social workers on this new MediShield Life.

I am happy to note that the Committee has looked at all aspects. It provides better protection, has affordable premiums and makes sure no one in society is left out and it is for life. It is on that, Mdm Speaker, I support the Bill.

2.22 pm

Ms Denise Phua Lay Peng (Moulmein-Kallang): Madam, the MediShield Life Scheme is the Government's response to one of the key anxieties of Singaporeans in an ageing society with increasing healthcare options and costs. I believe it is a game-changer in the national healthcare landscape in many ways; but especially in three areas – coverage for all, coverage for life and coverage with help.

Coverage for all. According to 2013 data, about 7% of Singaporeans were not covered under the MediShield scheme. That will change under MediShield Life. In the past, MediShield does not cover those with pre-existing medical conditions, whether they are born with it or acquired it later in life. In the past, about one in four in the Pioneer Generation were not covered under MediShield because they cannot work or cannot be reached or may have opted out. In the past, pioneers above the age of 90 were not covered under MediShield. MediShield Life will now cover all of them.

Coverage for life. In the past, MediShield protects members only up to a specific age with a lifetime claim limit of $300,000. With MediShield Life, they will now be protected for life, with no lifetime claim limit.

Coverage with help. Whilst premiums will increase, a slew of measures had been painstakingly put together by the MediShield Life team to allay fears of affordability. MediShield premiums can now be fully covered by Medisave, to avoid the need to pay upfront cash. There are also five types of subsidies that will kick in to ensure the affordability of premiums: one, Transitional Subsidies for all Singapore Citizens; two, Subsidies for Pioneers; three, Permanent Subsidies for premiums for the lower- to middle-income families and that covers two-thirds of Singapore households; four, Government's footing of the bulk of the costs to bring in those with pre-existing conditions; and five, additional support for those who need further help.

MediShield Life, to me, is a more appealing updated, more comprehensive and portable package that is personal and usable across all settings, whoever one's employer and station in life is. Let us support MediShield Life wholeheartedly.

Madam, MediShield Life, most of all, is not only about updating a national healthcare insurance scheme. It is the manifestation of the spirit of belonging to a country.

Basic healthcare coverage is an essential part of the safety net in one's life. Every citizen ought to be included and ought to have access to basic healthcare coverage and not just those who are accepted for access for coverage by insurance providers. The price to pay for that inclusion must be something that we, as the people of Singapore, must determine to pay. True, premiums will increase with this more comprehensive national healthcare insurance package. But we cannot say we are a Singapore family if we leave behind other members of the family when they get older, when they become health-wise vulnerable or when they are born with or later acquire disabilities through accidents or sicknesses.

I have sat through many dialogues including the "Our Singapore Conversations" where so many people spoke about having an inclusive country where the older and the disadvantaged will be cared for. But we cannot claim we want to be inclusive only in word and not in deed. We cannot lament about poverty or poverty lines if we do not support the move to pool our risks and ensure that those who are poor also receive universal basic healthcare for as long as they live; and those who are disadvantaged as well, in health.

Who knows if, one day, you or a loved one should land in circumstances that put you at risk of being excluded from healthcare because you are no longer young, healthy or financially able? Who knows if, one day, one of your loved ones is born or acquires some form of disability which a private insurer may not cover or cover only at a very high cost? Who, for that matter, would answer to the national call to have more babies if there is no guarantee that any Singapore baby, born in sickness or health, will have access to basic healthcare insurance coverage?

MediShield Life is Singapore society's response to the call to ensure that no one, now or later, is left behind as far as essential healthcare services are concerned. Whether we will use the service now or never, let us all support the scheme wholeheartedly and be proud that there is such a scheme in Singapore.

Let us also be patient and allow time for any gaps or administrative challenges in the scheme that may still need to be closed or overcome. These imperfections do not call for the baby to be thrown out with the bathwater.

In this regard, Madam, I would like to share three concerns commonly raised for Minister's comments and consideration. These concerns are, one, pre-existing conditions; two, defaulters; and three, sustainability of the scheme.

Concern one on pre-existing conditions. Madam, clause 4 of the Bill provides that persons who are deemed by the Board to have a pre-existing medical condition will be subject to premium loading. According to the Ministry, such persons will pay an additional 30% on top of the normal premium of an insured for 10 years; after which a normal premium is supposed to be applicable.

I understand that the bulk of the cost of bringing persons with pre-existing medical conditions into the common pool is already borne by Government; and that the additional 30% premium loading is a signal of co-ownership or co-sharing.

But the details of what might constitute a pre-existing condition and hence subject to premium loading, have not been published or explained in detail. And that is a cause for anxiety for at least two groups of Singaporeans.

One, special needs persons with lower medical risk. Madam, I have been asked by members of the special needs community if any person diagnosed with an intellectual disability or learning disorder or had spent time in a special school, would be automatically slapped with an additional 30% premium loading. Many of them, for example, the deaf, intellectually disabled or those with other learning disorders, may experience challenges at schools and workplaces that relate to their ability to learn, socialise and be included; but physically, health-wise, these persons may not be at risk of requiring more medical treatment or even hospitalisation than the rest of the Singapore population. Hence, the feedback is for persons with special needs who do not have adverse medical claim track record, should not be subject to the additional 30% premium loading.

The second group who are anxious are persons who are subject already or going to be subject to additional premium loading. Madam, as details on the subject of "pre-existing conditions loading" are not fully released, affordability for those with additional premium loading is a concern.

There is also ground fear that the return to a normal premium for these persons after 10 years will apply only to those who have good claims records for the initial 10 years. For those who are chronic or more severe, they worry, perhaps unfounded, that they will be made to continue to pay the same or higher premium loading. These are persons who are currently not covered, because they are born with congenital illnesses, or they have acquired chronic medical problems due to strokes or accidents, prior to the introduction of MediShield Life.

Being turned down, being rejected or being made to pay very high premiums was the experience of many of these people with pre-existing conditions in the current healthcare landscape. As many of them may not be employable and their families cannot support them for life, they seek assurance that the government of the day will always ensure affordability and find means to ensure that they are appropriately covered.

I therefore seek the Minister's consideration to codify the principles of MediShield Life's pre-existing conditions scheme. This is so that members will not be subject to the additional loading without good medical reasons; and so that premiums for those who are subject to additional loading will always remain affordable.

Concern two, on defaulters. Madam, the MediShield Life Bill has provided a full section, Part 3, clauses 11 to 18, on policies and practices relating to defaulters. I fully agree that since this is a shared scheme of collective responsibility, any member who can afford but wilfully does not pay up, should be subject to punitive measures.

Madam, for those who truly cannot afford, I seek the Minister's assurance that defaulters who cannot pay for good reasons, be treated with not only justice but mercy as well. I am referring to examples of members who live in bigger abodes whose Medisave could have been depleted as a result of serious illnesses or big hospitalisations or business failures or by the sheer fact that they are not employable due to disabilities or chronic illnesses. There may also be households where husbands simply cannot afford to top up the Medisave balances of their non-working spouses, in addition to topping up their own.

So besides treating these special defaulters with mercy, may I also suggest that MOH proactively work with MSF to develop a register of vulnerable persons such as these and pay special attention to them?

Perhaps a Special "Top Up My Medisave Fund" could be set up and the relevant Ministries could advocate for annual top-ups during Budget time and/or encourage philanthropists or members of the public to contribute to such a Fund and help them top up.

Concern three is on sustainability. To help Singaporeans with their MediShield Life premiums, the Government, we understand, will provide close to $4 billion over the next five years. Government is bearing the bulk of the cost of extending coverage to those with pre-existing conditions, Premium Subsidies, Pioneer Generation Subsidies, Transitional Subsidies, all these are borne by Government. All these are well thought out, very thoughtful and deeply appreciated.

But what happens after five years and the years after is important food for thought and discussion. Although Transitional Subsidies will no longer apply then, there is still the permanent bill for Premium Subsidies for the lower- to middle-income families and the Pioneer Generation Subsidies. Other factors will also come into play. With a new-found confidence by members that coverage is now for all and for life with no cap to life-time claim limits whatsoever, the potential of higher and over-consumption is real. With lower co-insurance payments by the insured, will there be a temptation to go for more lavish or boutique services and prescriptions? Added to this is, as most of us know, that by 2030, one in five will be 65 years and older, and almost a million people belong to that group.

So what can be done to mitigate the high possibilities of over-confidence, over-consumption, over-prescription that will lead to an escalation of healthcare expenditure and therefore premiums in the long term?

Can the Ministry set up a Work Group to look deeper into incentives to look after one's health; to educate Singaporeans on less costly but just as effective medical prescriptions and to develop solutions to reduce over-consumption of healthcare benefits?

On the supply side, where would future funding and revenue sources come from if healthcare costs are expected to rise? Even if we dip into the national coffer, is that a wise long-term strategy? A lot of these will have, of course, to do with the ability and the wisdom of the Government of the day; but still, Madam, it would be useful to hear the comments of the Minister on these potential longer-term issues, for the sake of those who come after us.

In conclusion, Madam, at last year's July discussion of the White Paper on MediShield Life in this House, Minister Gan spoke about the important blend of three body parts that would make this important scheme a successful reality. He says the Team needs to Listen with their Hearts, to know what are the worries of Singaporeans; to Think with clear Heads and to be Hands-on during implementation and delivery. The Bill has reflected that the Ministry has indeed deployed well their Heads and their Hearts. It is now the time for the most challenging part of the Scheme to ensure that the Hands now deliver.

I thank the Team for the excellent work, and I really look forward to a successful albeit a very challenging delivery of this important birth. I urge all Singaporeans to support the Ministry of Health's Team in this very important implementation phase and constructively help to explain, help to improve and help to make this Scheme work. With that, Madam, I support the Bill.

2.35 pm

Dr Janil Puthucheary (Pasir Ris-Punggol): Mdm Speaker, MediShield Life has been debated extensively in the House and there was and is overwhelming support for the aim of universal healthcare insurance coverage for life, for all Singaporeans. We did not debate on whether the Bill goes too far.

This is quite noteworthy. In many parts of the world, the idea of a mandatory, compulsory or universal healthcare care financing framework brings out the worst possible rhetoric and posturing from the political right, with accusations of welfarism and socialism. In the United States, the debate over the Affordable Care Act was particularly heated in this respect. On the other hand, in a place like the United Kingdom, where there are proposals to introduce market and insurance mechanisms to the NHS, it has also drawn accusations about heartless capitalism from the left. Here, in Singapore, in debating and discussing the changes to MediShield that take it to the next level, MediShield Life, this has not been the issue. We take it as read that we can use insurance, co-payments and other tools of the market to achieve what is essentially a fairly socialist aim, that is, the provision by the state of accessible, affordable healthcare for all. The Government is not being attacked for a welfarist or socialist position, quite the opposite, there are many calls to do more, provide more help, reduce the financial burden even further. And the response has not been one of ideology, but rather the practical reality – everything we do has to be sustainable, we must not burden our children of tomorrow with the bill from the political promises of today. We have moved past ideology, and that is something to appreciate, to be grateful for, and to preserve.

Madam, the peace of mind, the security and the safety net provided by a universal, lifetime insurance plan, with no exclusion on the basis of pre-existing conditions, are considerable and will put to rest many fears, concerns and anxieties. There have been questions about the sustainability and financial viability of the scheme. These have been discussed, debated and answered, but, in truth, we will always need to keep a close eye on this, as health and healthcare expenditures are very unpredictable. In general, however, Singaporeans should have peace of mind that they are much better protected from large hospital bills.

I have a number of questions about MediShield Life.

My first is about the process of a Singaporean opting out of the information discovery and that can either be the healthcare issues or their means and wealth. This comes with a cost, as discussed, of the citizen having to bear a higher premium. My question is about the process of opting back in again. How often will this opportunity be available? On a yearly basis? On a rolling basis? Is there a minimum time period for which the citizen will have to pay the higher premium? When the citizen opts in again, it is appropriate that the administrators of the scheme will need to have access to healthcare data from the period during which the citizen had opted out, so that the risks of possible pre-existing conditions can be assessed properly. However, would the income, wealth and means data from the time period that the Singaporean had opted out of means-testing, be then available and be scrutinised when they opt back in again? I assume that there is only a need for the scheme to assess the citizen's means at that point in time, but could the Minister please clarify this?

Next, if I may draw your attention to clause 16, where significant powers of enforcement are granted to deal with defaulters from the scheme should they wish to leave Singapore. Essentially, this is to ensure that the scheme is truly universal and mandatory. I would like to contrast this with the situation of a non-Singaporean, who is struck by an unforeseen catastrophic illness and racks up a large bill at one of our public healthcare institutions, a bill they may not be able to pay. I realise that the comparison is not entirely appropriate as on the one hand, you have a national insurance scheme, and on the other hand, you have an operational cost recovery problem for the specific hospital. But if that bill remains unpaid, becomes a bad debt, as occasionally happens, this will affect the costs for our healthcare system, as the Minister has described, and lead to an increase of healthcare costs in general, and so, eventually, have an effect on the premiums.

Philosophically, from the issue of social responsibility, there is also the issue that we are mandating an appropriate financial burden to provide the healthcare insurance coverage for Singaporeans, without making the same requirement on non-Singaporeans who may utilise our healthcare infrastructure. In general, this will not be an issue and most will pay their unsubsidised bills in full and on time. But where unfortunate circumstances overtake these non-Singaporeans, they may not be able to pay, even if they intend to. In particular, I am concerned about the non-Singaporean dependants, for example, children and grandparents, who will not be covered by the employer of the primary pass holder. For the purposes of protecting the finances of our public institutions and in order to achieve parity with the requirement placed on Singaporeans, I would like to suggest that MOH consider mandating healthcare insurance for non-Singaporeans that are here for a prolonged period of time. This would not fall under the remit of MediShield Life, and so should not affect the risk pooling. It should be an entirely commercial insurance product, with no risk to the public finances, and it need not be comprehensive in terms of healthcare coverage. Essentially, there are two minimum options, either coverage for catastrophic large hospital bills, over a certain threshold, or to cover the repatriation of the person to their home country. But in order to drive this process, it needs to become required, mandated by law, rather than voluntary.

I am in no way suggesting that we need to close the doors of our emergency departments to non-Singaporeans, nor am I suggesting that we need to see documentary evidence of insurance pre-approval before providing timely and necessary care. At the frontline of public healthcare, we must still continue to provide help, care and treatment as needed, as soon as presented with a patient, as we have done. We should continue to allow non-Singaporeans to visit us and to utilise our excellent healthcare services, because that is the morally correct and human thing to do. But we should help to ensure that they can deal with the costs should something unforeseen and unfortunate happen, and that this should not be a burden on the finances of the Singaporean public institutions and, finally, to ensure that there are no loopholes for abuse.

Moving on to my last point, Mdm Speaker, I had previously spoken in the House about smoking cessation and the benefit this would bring to the health of our nation. I continue to believe that the best course of action would be to enact the Tobacco Free Generation Proposal, a ground-up initiative conceptualised here in Singapore, and rapidly gaining attention around the world, where individuals born in the year 2000 and later are prevented from purchasing cigarettes.

This does not fall within the remit of MediShield Life, but the shift to universal provision of healthcare insurance gives us an opportunity to reconsider the issue. The universality of the MediShield Life scheme and the attendant risk-pooling means that the problems of smokers are now all our problems. The impact of smoking-related diseases will increase the premiums for all Singaporeans, unless we continue to act to help people stop smoking. I applaud MOH and HPB and many other institutions for the hard work they do in this area, but more needs to be done, and I fear it will be many years before we can see the last case of smoking-induced cancer.

I have a suggestion. It would not be my first choice, but if we cannot achieve a tobacco-free generation through a legislative mandate, how about using the economics of MediShield Life to help drive the right behaviour? Specifically, if a person should be discharged, not admitted – you do not know what is happening to you when you are admitted – from a public hospital with a smoking related disease; thereafter, for all costs related to the same disease, should he not have to pay a larger proportion of the bill if he is still smoking? And how might we know that if he is still a smoker? There is a very simple test, called the urinary cotinine, using a urine dipstick to test for a substance that is a by-product of tobacco, which remains in the body for a week after smoking. If the individual's urine is positive, how about requiring them to pay a larger portion of the bill? If we do not have a mechanism like this, the true cost of that person's smoking is passed on to all Singaporeans as a result of increased healthcare expenditure. This method that I have suggested would not affect the premiums paid, nor would it deny a citizen access to healthcare. It would not affect the charges for healthcare prior to the first diagnosis of a smoking-related disease. But having been admitted for smoking-related diseases, this becomes a very powerful incentive to quit and if you are far-sighted enough, of course quit long before you have a smoking related disease. We have considered discounts, penalties, rewards and rebates as a means to shift behaviour in many other spheres of life, from purchasing goods and using power to parking. Why not use it as a mechanism to encourage people to give up smoking?

Mdm Speaker, in conclusion, the Jubilee Babies born this year will grow up in a society where they have automatic inclusion into a universal healthcare insurance scheme, allowing them affordable access to some of the best healthcare in the world. They will enjoy a public healthcare system that is robust, effective and sustainable. They will not believe there was ever a time when this was not available. They will not believe that there ever was such a thing as an exclusion criterion. The idea of being "uninsurable" will be unfamiliar to them. They will assume that universal healthcare coverage for life is the natural way such things should be done and they will not understand the anxiety their parents and grandparents had about growing old and not being able to afford healthcare. It is only good and right that we can remove this fear, calm this anxiety, and provide all Singaporeans the healthcare that they need. Madam, I support the Bill.

2.45 pm

Ms Lee Li Lian (Punggol East): Thank you, Madam. This Bill sets out the legislative framework and powers for the implementation and administration of the MediShield Life Scheme. I support this Bill but I have several clarifications and concerns which I will elaborate as I move on.

One, penalty for late payment of premiums. According to clause 11, interests may be imposed from time to time on outstanding premiums for that insurance period for those who default on payments. And in clause 17, a penalty may also be added on to the premiums and interests. I would like to find out under what circumstances will interest and/or penalties be imposed.

The total amount of penalties and interests imposed cannot exceed 17%. According to an online article from Channel News Asia, these recovery measures are meant to clamp down on wilful defaulters with the means to pay their premiums and are adapted from existing income tax legislation. On what basis did MediShield Life decide to adopt such measure from the income tax legislation and how is medical insurance premium comparable to income tax?

Will the insured lose their cover if the payment is still not recovered despite multiple reminders and interest incurred? I would like to assume that they would not, since this is a compulsory national insurance but, still, I would like to seek a confirmation. And if the insurance is indeed lapsed, is there a function to reinstate the policy?

Will this scheme allow premium holidays for insured who genuinely cannot pay for their premiums? These could be individuals who lose their job and stop contributing to their CPF Medisave. Some may argue that although the insured becomes unemployed, Medisave savings will be able to see them through the difficult period. However, let us not forget that there are individuals who are paying for the premiums of their children, spouse and parents from their own Medisave account.

Next, access to health information. An authorised person, certified by the Minister, can have access to an individual's health information or history. I can understand the need to have access for such information for the purpose of determining the loading factor to the premiums as stated in clause 27, subsection 1a. However, like many Singaporeans, I am concerned about how much information is available and accessible to those given the authority to assess the database. What security measures are put in place to ensure that the abuse of medical information is kept to the minimum?

An individual can choose to opt out of the system if he or she does not want to give such access to the Ministry. Once an individual is out, will all details be removed from viewing, or only partial information? Apart from not being able to enjoy premiums subsidies, what other benefits are they not entitled to? Will there be any implications to their claims? At which point of the application process would the insured be able to opt out?

Third, underwriting process and pre-existing conditions. Like every insurance policy, an applicant needs to go through the underwriting process. I would like to find out how will this be done in the case of MediShield Life. Will this be individual or group underwriting?

One of the key features of MediShield Life is that it covers pre-existing conditions. Pre-existing conditions not currently covered under MediShield will have to pay an extra 30% in premiums for 10 years. Is 30% a standard rate for all pre-existing conditions, or is it a range of up to 30%, depending on the severity of the pre-existing conditions?

Next, the insured will pay normal premiums after the 10 years. Is this guaranteed or subject to claims and/or premium payment experiences? More details on what constitutes pre-existing are not available. What about a scenario such as an insured who was fully covered under MediShield, a few years down the road the insured took up a private integrated shield plan and had conditions to be excluded? Will such conditions be treated as pre-existing and will be required to pay more premiums under MediShield Life?

Lastly, for insured who are currently on private Integrated Shield Plans, their premiums are paid directly to the private insurers who will service the policyholders' needs. Private insurers will service all claims and sort out back-end arrangements with CPF Board to include any payouts from MediShield through the Central Claims Processing System, better known as CCPS. Since MediShield Life is replacing MediShield, am I right to assume that the current procedures remain unchanged? That is, the insured do not need to pay premiums separately? With that, I look forward to the Minister's responses. Thank you, Madam.

2.50 pm

Ms Chia Yong Yong (Nominated Member ): Thank you, Madam. I speak in support of the MediShield Life Scheme Bill. I also declare my interest as the President of SPD and board member of SG Enable, both of which organisations serve persons with disabilities, that is, persons with pre-existing medical conditions. I am also personally interested, being currently subject to policy exclusions on grounds of my physical disability and being closely related to persons who are currently subject to policy exclusions or totally excluded from insurance cover.

I applaud the Government's move towards universal health coverage, erstwhile elusive. The MediShield Life Scheme marks another significant commitment by the Government towards greater acceptance and inclusion of persons with disabilities within our society. The Scheme promises to make significant social impact, but it comes with its corresponding costs and burdens and as such, we must be particularly careful in its enactment and execution.

The nation's interest is served not simply by the introduction of this scheme but more by its acceptance by Singaporeans and its fair, effective and sustainable execution. With this in mind, I raise five issues for the consideration of the House.

Firstly, the scope and definition of "pre-existing medical conditions". Clarity, as much as is achievable, is important in this respect, given that premium loading will be applied based on the same.

I therefore seek clarification from the Minister on the following. I noted that the Minister did say he was going to share broad categories of the pre-existing medical conditions with members of the public. I also request that more details be given and also that criteria in assessing premium loading be shared and made transparent as well.

The MOH Factsheet states that those with "serious pre-existing conditions" would be liable to premium loading. Is it then correct to say that "non-serious" pre-existing medical conditions will not be subject to premium loading? And I see the Minister nodding so I suppose that is the answer, then, I do not have to ask any more. Thank you.

Noting the recommendation also of the MediShield Life Review Committee to exclude from the Scheme treatment for self-inflicted injuries and attempted suicide, will the Minister consider persons who suffer from self-inflicted injuries or who attempt suicide by reason of mental illness? Can this class of treatment be included under the Bill?

Noting also that the determination of a pre-existing illness and, therefore, the application of premium loading will have an adverse impact on any future application for insurance cover, will the Minister consider an appeal process whereby persons can make a direct appeal and have their conditions re-assessed?

Madam, the second issue that I would like to raise concerns the payment of premiums for persons above 21 years old who lack capacity within the Mental Capacity Act. These are the people who may not have donees, who may not have court-appointed deputies and who are above 21 years old. How will the Government ensure that premiums are paid? It would be onerous to require them to make an application to court or to require their caregivers to make an application to court just so that premiums can be paid. I would request the Minister to consider making provision for premiums to be paid by the donee, deputy, or in the absence of either, a parent or both parents of such an insured person.

Madam, my third issue concerns the application of section 59 subsection (6) and subsection (7) of the CPF Act, as sought to be amended under the Bill. Can the Minister clarify the application of the amended subsections to the MediShield Life Scheme? The subsections govern the appointment and the assignment of liabilities under the original MediShield scheme to appointed insurers. How is that going to be applied to the MediShield Life Scheme? Will private insurers be appointed, and if not, then why are the amendments sought to be made under the Bill? And if not, then why is the current section 56A of the CPF Act not to be repealed?

If private insurers are to be appointed to manage the Scheme, then I think there is great cause for concern insofar as sustainability, insofar as the protection of private data and those who insofar as, whether or not at the end of day, we could be held to ransom because there are just far too few insurers out there who can manage this Scheme for us.

I then move on, Madam, to the fourth issue which has been raised by my fellow Members on affordability and subsidies. I will not belabour the points that have been raised but I do want to thank the Government and the Minister for the re-assurance that persons who cannot afford to pay premiums will be assisted with that. I also, however, want to request the Minister to consider including additional criteria apart from income and household house value in assessing whether or not an insured person qualifies for Premium Subsidies. The reason is simple – anyone with a pre-existing medical condition would naturally have to spend a lot more in terms of treatment and in terms of other ancillary requirements, such as even transport costs. So, there would be other considerations and I hope that the Minister would take those other criteria into account.

Another point that has been raised by fellow Members is the issue of the importance of ensuring that medical costs do not soar as a result of the provision of insurance. After all, if I do not have to pay, why worry about spending?

Minister, I think I would like to share my thinking that the focus of the Bill is really on treatment, and cost is important, but cost is ancillary. So, while we should be careful about managing the costs, we must also be judicious in the way in which we are going to be monitoring the spending because we must not harness our doctors. They are the ones who know best how to treat, and so we must not have guidelines that tie their hands. I certainly hope that the Ministry would look into this, that even as we monitor, we will be judicious in our guidelines.

My final point, Madam, although not the least important, for the scheme to be sustainable in the long term, we need the Government to continue to honour this commitment. But, whilst we can legislate the proportions of contributions to the MediShield Life Fund and we can legislate how much the contributions are going to be, we cannot legislate empathy, and we also cannot legislate acceptance of persons within our community who have greater needs.

The people of Singapore must believe in this scheme and support it. It must emanate from within their hearts and minds. For this, we need the mindshare of the people and the heart-share of the people of Singapore. We cannot run the Scheme and legislate and force people to pay. We cannot talk about penalties and say, "Oh, you know, if they do not pay, what are we going to do? How strict are we, how stringent are we, how robust are we in enforcing?" It helps, it helps, and that is why I have not talked about penalty because, personally, I think it is important. But we must go out and we must explain to people as my hon colleagues have done, that it can happen to just any of us, and it is important for us to have this sense of collective responsibility.

The MediShield Life Scheme, as the Minister pointed out, is not just about insurance. It is also not just about premium loading, Premium Subsidies or penalties. It is about corporate responsibility. Undergirding the whole scheme is the higher ideal of a collective responsibility and societal cohesion. It is not about abuse; it is not about compassion; it is not about charity. It is about respecting the dignity of Singaporeans, in sickness or in health, and it is about us as a country.

During the "Our Singapore Conversation", many participants emphasised the need to bring back the kampong spirit. There has also been much feedback, from the ground and "Our Singapore Conversation", on the inadequacies in the provision for disadvantaged persons. How much more can be done; how much more should be done for the people in our community. I am personally heartened by such feedback because it shows that our people care for the disadvantaged in the community. So, I now call upon these ones who gave that feedback and these ones who believe in it to rally behind and to support the scheme, to go out and to be the ambassadors to other Singaporeans so that they, too, will rally behind and support the scheme.

This is our opportunity, by contributing to the pool of premiums, to play our part in ensuring that every Singaporean has access to medical care. This is our opportunity to show our kampong spirit, and to express our respect for the dignity of fellow Singaporeans. This is when Singaporeans walk the talk. The success or failure of the scheme, and, indeed, of our society, lies within our own hands. Mdm Speaker, on that note, I support the MediShield Life Scheme Bill.

3.01 pm

Mr Zaqy Mohamad (Chua Chu Kang): Mdm Speaker, thank you for allowing me to speak on this "game-changing" Bill. The MediShield Life Scheme is a game-changer because it is exactly that – it completely transforms the coverage for healthcare insurance in Singapore, most importantly, because it is a universal system. For the first time ever in Singapore, everyone – regardless of age, income levels or health levels – will have access to coverage. What better way for our young nation to mark 50 years of its short history by showing that it has matured to embark on a universal system?

I have several points to make today that I feel will help strengthen the MediShield Life system. Allow me to make these points.

Firstly, access to data. Much has already been said, in this House and outside in the mainstream and social media, of the Bill allowing the Government unequivocal access to an individual's income and health records.

Although the legislation will allow those who find these powers intrusive with the choice to opt-out from having their information shared, I feel that this will be counter-productive to the aim of establishing a universal health insurance system in Singapore.

The idea of MediShield Life, in the first place, is to get everyone to enjoy a cost-effective medical coverage. So, why should we allow one to opt out of information sharing for means-testing and pre-existing illnesses only to incur the additional 30% cost loading? This is counter-productive in providing affordable healthcare when, in principle, the data already reside in one of the Government's databases or registered partner.

I do believe that we have established a reasonable trust level for Singaporeans to declare their income and health records today with the Government agencies, much like we do in our annual income tax submissions. This system is about collective responsibility and the majority helping to subsidise the costs, including the additional loading of 30%. As I understand from the Minister's speech earlier, that 30% loading is cross-subsidised by the rest. So, it is not equitable for some to simply opt out on information and load on the others.

I would also like to highlight a potential loophole. It is quite possible for someone here who has been seeking healthcare treatment outside of Singapore for a pre-existing condition to keep it undeclared and may even get away with it without being found out. I would like to ask the Minister how the Ministry plans to close this loophole.

To improve the integrity of the policy, I would also like to propose setting up a whistle-blowing access so that errant individuals can be identified. I am also supportive of stronger penalties should anyone be found to have declared false information so that it is a strong deterrence for errant behaviour. And this will continue to ensure the robustness and integrity of the system.

Many Singaporeans would already have existing private insurance coverage. This may not necessarily be just the higher-income Singaporeans but also, I think many of the middle-income Singaporeans who are also financially savvy to protect themselves and manage to work out premium payments from their monthly incomes. Such individuals may now end up paying double premiums and I am afraid this may prove to be taxing on them. Even though they can pay for their own MediShield Life premiums using their Medisave accounts and not affect their monthly disposable incomes, it is nevertheless a strain to pay for two policies at one time.

I would suggest that Singaporeans with existing policies be given a transitionary period to choose to exit their private insurance plans, especially those whose plans are maturing in the next few years or so. This group can either be given a grace period to complete their private insurance commitments before they officially come on board the MediShield Life or, perhaps, if they fall within the low-income bracket, their MediShield Life premiums can be subsidised during this transitionary period.

On the issue of affordable premiums, I think many Members of this House have spoken. But I would like to add on a few more points. I think the Government has done a lot to ensure that the premiums remain affordable for all Singaporeans. Through a mixture of Medisave payments, subsidies and financial assistance for those who still need more help, the Government has done its best to ensure that it may be difficult to default on premium payments.

On this point, I am particularly concerned with one group, which is the families who are supporting homemakers and young children, those who are unable to work due to chronic illness where the husband or the family members do not have enough to pay for others in the family for their MediShield premiums.

Can the Ministry provide more details on how it plans to assist this group and after how many months of default before the MediShield coverage is cut off? I hope that we monitor this vulnerable group over the next few years and keep track to make sure they do not fall off the scheme due to affordability concerns. Come 2019, when the transitionary subsidies fade out, the increase in premium payments then can be quite steep, especially if you are a low-income earner with some pre-existing ailments.

The strength of the MediShield Life system will be in its long-term sustainability, that is, for Singaporeans to remain on it for their lifespan. If more of them are going to find it difficult to keep up with the steep increase in premiums from 2019 onwards, then we may need to review to see how it can be made more affordable then.

I would like to suggest that the Government do a mid-term review before 2019 and identify those low-income individuals whose Medisave may fall short when the subsidies are phased out. For this group, the Government may wish to consider a Medisave top-up so that their risk of not meeting premiums is significantly lowered.

Among residents, there is also a common perception that with the Integrated Plan, one has to continue to pay two premiums rather than one. How does the Ministry plan to address this and how can we improve public understanding of this rather complex policy?

On the issue of pre-existing illnesses, for those with pre-existing illness conditions, the Bill stipulates that they need to pay 30% more on their premiums than others. On the one hand, this may be fair based on the principle of equity. If someone is going to draw more from MediShield Life, then they should be expected to pay higher premiums, and that is what private insurance plans are likely to impose as well.

I would like to propose that the Government review the requirement for low-income earners to pay additional premiums at a tiered level. So, what it can do is to look at alternative loading tiers for low-income earners, for example, paying a lower loading, and the high-income earners paying a different loading, and the medium income, perhaps, keeping your 30% loading, for example. Madam, I move on now to my Malay speech.

( In Malay ) : [Please refer to Vernacular Speech.] MediShield Life is a scheme that will benefit Singaporeans and permanent residents from all walks of life, not only as a form of protection, but it also brings relief to several groups like the needy and those with pre-existing conditions.

For the Malay community that is always concerned with health and healthcare cost issues, this scheme is a welcomed one. I suggest that the community study this scheme in detail and make use of it, even if they already have their own health insurance.

In this regard, I propose that the Ministry and related agencies increase efforts to explain to Singaporeans the details of MediShield Life so that everyone will be clear and everyone will understand it.

Their concerns in terms of affordability and subsidies that are provided must be addressed. The implementation of this scheme must be reviewed so that it will not burden certain groups too much, including those with pre-existing conditions.

( In English ): Mdm Speaker, on the whole, I support the Bill.

3.09 pm

Mr Png Eng Huat (Hougang): Madam, the proposed MediShield Life will address the fundamental issue of providing basic universal health insurance for all Singaporeans.

The transit from MediShield to MediShield Life may be a non-event for many Singaporeans due to Transitional Subsidies. But for two groups of Singaporeans, those with pre-existing conditions and those with pre-existing medical benefits, the impact of the new health insurance scheme could be significant.

For Singaporeans with pre-existing conditions, it means a lot to be able to buy health insurance for their pre-existing conditions finally, albeit at a higher premium. MediShield Life is taking a step in the right direction. I urge private insurers to ride on this and provide better coverage for those who need more benefits and to keep the additional premiums affordable since the underlying risk of covering someone with pre-existing condition is already underwritten by MediShield Life.

As for Singaporeans with pre-existing medical benefits, the transition to MediShield Life may not be so straightforward. This group includes people with private medical insurance plans and pensioners.

For those people with private medical insurance plans other than the integrated shield plans, it does not make financial sense for them to over-insure themselves with MediShield Life. These Singaporeans should be exempted from the scheme. They can opt to join the scheme anytime or when their private insurance coverage ends since premium is calculated based on age, annual value of their home, per capita household monthly income, and there is a 30% loading on premiums for those with pre-existing conditions.

I can understand the Government does not want Singaporeans to be saddled with large medical bills if they are underinsured. But this can be easily resolved by drawing up a list of approved private healthcare insurance plans in lieu of MediShield Life that would qualify Singaporeans for exemption.

Next, the impact of MediShield Life on the 32,000 pensioners needs to be spelt out clearly. The last time I spoke on this issue, I asked that these pensioners be given an option to opt out of MediShield Life as well. Although the Health Minister has assured this House that pensioners will not be worse off, I will repeat my call for pensioners to be given this option for good reasons.

In a news report last July, the Public Service Division (PSD) announced that 40% of these pensioners who are currently receiving 1% additional Medisave contribution will get another 1% when MediShield Life starts. This will certainly help pensioners who are on the Comprehensive Co-payment Scheme (CCS) cope with the transition to MediShield Life.

In the same report, it was mentioned that the other 60% of the pensioners who are on older medical benefit schemes, which "already provide better coverage than what MediShield Life will be providing," will have their premiums for MediShield Life paid for by the Government. The reports said PSD would be writing to pensioners with more details on MediShield Life by October 2014.

Madam, I wish to ask the Minister to share with this House the impact of MediShield Life on this group of pensioners whom PSD had said are currently receiving better coverage than what MediShield Life will be providing.

Apart from paying the premiums for these pensioners and their spouses, what about the deductibles under MediShield Life that they have to bear now?

For pensioners under the Fixed Amount of Ward charges scheme (FAW), their public hospital bills are capped at $8 per day. Would these pensioners and their dependants be paying the same rate under MediShield Life?

For pensioners and their dependants under the Co-Payment on Ward charges scheme (CPW), their co-payments for ward charges are capped at 20% and 50% respectively. For a hospital bill of $2,000, for example, these pensioners only need to pay $400 for themselves. How much would these pensioners be paying under MediShield Life since the deductible for a Class C ward is already $1,500 for policyholders aged 80 and below?

How would MediShield Life be better for these pensioners when PSD has acknowledged that it is not? And why would the Government want to go to great lengths to match the benefits of MediShield Life with what the pensioners are currently receiving when a simple solution is to let them remain status quo?

The MediShield Life Review Committee report has made reference to the Swiss experience on health insurance. The Swiss has mandatory health insurance but there are exemptions allowed for good reasons. Likewise, our MediShield Life Scheme should also allow exemptions, especially for pensioners and for very good reasons.

One, pensioners have an existing ecosystem in the Government catering to their needs, including a comprehensive Medical Billing System for participating medical practitioners to file medical claims so that pensioners and their dependants do not need to pay the full fee upfront.

Two, this group of pensioners will never grow in numbers. Their percentage share of the insured pool is negligible and shrinking at the same time. Would it be so difficult to let this group of pensioners remain status quo and run its course?

I urge the Ministry to consider implementing exemptions for MediShield Life for these selected groups of Singaporeans as highlighted. Madam, I support the Bill.

3.15 pm

The Deputy Prime Minister and Minister for Home Affairs (Mr Teo Chee Hean): Mdm Speaker, can I seek a clarification, please?

Mdm Speaker: Yes, please.

Mr Teo Chee Hean: Madam, if I heard correctly, the Member said that the Government had said that these pensioners would be worse off. Can I seek a clarification from the Member, please?

Mr Png Eng Huat: I did not say that these pensioners would be worse off. I read a report that was in the newspaper that says, and I quote, "In the same report, it was mentioned that the other 60% of the pensioners who are on older medical benefit schemes, which ‘ already provide better coverage than what MediShield Life will be providing'." That was reported in the news.

Mr Teo Chee Hean: Madam, can I ask the Member to please continue because I thought I heard after that, he said that the Government had said that pensioners would be worse off?

Mr Png Eng Huat: Okay. This is my speech: "The report said, ‘ PSD will be writing to pensioners with more details on MediShield Life by October 2014.' So, I want to ask the Minister actually to share with this House the impact of MediShield Life on this group of pensioners whom PSD has said are currently receiving better coverage than what MediShield Life will be providing." That is what the report says in the newspaper.

Mr Teo Chee Hean: I just want to be sure, Madam, that the Member did not say that the Government said that pensioners would be worse off.

Mr Png Eng Huat: No, no, definitely not.

Mr Teo Chee Hean: I am very much reassured, Madam, because in my response to him previously on pensioners, the Government had very clearly said those who are on the old medical schemes will continue to receive all the benefits that they currently have under the old medical schemes and that Government will pay for the MediShield Life premiums of these pensioners. And so, they will continue to have all the benefits that they currently have.

In fact, pensioners will have one important benefit with MediShield Life that they did not have previously. Previously, the spouse of a pensioner would cease to have medical benefits when the pensioner passes away. With the new MediShield Life, pensioners' wives will be covered by MediShield Life. I hope that the Member will help to reassure pensioners rather than causing them anxiety by raising issues which are not true.

Mr Png Eng Huat: Mdm Speaker, may I respond?

Mdm Speaker: Yes, please.

Mr Png Eng Huat: What I raised are features that are in the pension plan now. They are not a figment of my imagination, concocted just to alarm pensioners. This is what they are getting now. If they are paying $8 per day – this is asking a question to the Minister whether under MediShield Life, they would be getting the same thing. These are not things that I concoct out of my own imagination just to alarm pensioners. I just want to seek clarification; if pensioners were to go on MediShield Life, what would they be expecting? Are they going to be expecting the same kind of payment? This is what I just want to seek clarification on.

Mr Teo Chee Hean: Madam, the answer is yes. In fact, they would get more because if the pensioners pass away, their wives will continue to be covered under MediShield Life, something which the wives would not have had previously. So, the answer is yes, unequivocally yes. Pensioners who are on the old medical schemes will continue to enjoy all the benefits that they currently have under their old medical schemes. I think that was already very clearly stated previously. I hope that the Member, instead of raising red herrings, will help to reassure pensioners of this.

Mdm Speaker: Yes, Mr Png?

Mr Png Eng Huat: These are not red herrings, but these are benefits that the pensioners are receiving. Are these not the benefits that they are currently receiving? So, if they are, then I am just raising them, and asking them, "When you transpose that to MediShield Life, are they going to pay $8?" And if you say that it is, then yes, that should be quite clear then.

But then the thing is, in the previous reply, there were no mentions of how much they are going to pay for their medical bills under MediShield Life because there is a deductible. That is, $1,500.

Mr Teo Chee Hean: Mdm Speaker, the PSD has communicated directly with all these pensioners, explaining to them that they will continue to receive the same medical benefits as they had before, and the Government will pay for their MediShield Life premiums. In fact, they will be better off, as I have explained, because their spouses would be covered by MediShield Life even after they pass on. I hope that the Member will help us to explain this to all the pensioners rather than causing alarm.

Mdm Speaker: The point is this. Mr Png, you sought a clarification on pensioners. The Deputy Prime Minister, as Minister in-charge of the Public Service Division, has given that clarification, and I am sure that further clarifications would also be given by Minister Gan in his reply.

So, let us now move on. Dr Lim Wee Kiak.

3.20 pm

Dr Lim Wee Kiak (Nee Soon): Mdm Speaker, that the MediShield Life Scheme will formally be implemented this year is good news to many. The Scheme has created plenty of buzz since last year when it was first announced. Many of my residents are looking forward to the finalised details, mostly with anticipation, although some with a little trepidation.

The goal of MediShield Life is to ensure that the healthcare costs of every Singaporean and PR, from young to old, healthy and those with pre-existing conditions, regardless of income group, are all covered. This is a thoughtful scheme that closes up some of the existing gaps in healthcare safety net provided under our 3M health coverage system now, where no private insurance company would venture at times even at higher premiums.

In the medical profession, this scheme is of great interest to many of us as well. We have come across examples of patients struggling so much with medical bills that they have wanted to give up treatment. Or elderly residents who have confided that they were afraid of seeing the doctors for fear of spending money from their retirement nest egg.

As a medical professional, I know that because of the advancement in medical science and technology, many once-fatal diseases can now be treated. But this also means the cost of procuring the increasingly sophisticated equipment, the cost of R&D into new drugs and the cost of training skilled personnel are higher, and they have to be paid for somehow. These translate to increased healthcare costs, much of which our Government have gallantly responded to by giving subsidies.

With this Scheme in place, I am confident that more people will be willing and be able to seek treatment that they require. My grassroots teams and myself will do our part to inform and educate all our residents on how to benefit from this particular Scheme.

This Scheme is indeed a universal healthcare coverage. If you look at the definition of universal healthcare coverage from the World Health Organization's definition: (1) it has to be a strong, efficient, well-run health system that meets priority health needs through people-centred integrated care; (2) affordability – a system for financing health services so people do not suffer financial hardship when using them; (3) access – access to essential medicines and technologies to diagnose and treat medical problems; (4) last of all, a sufficient capacity of well-trained, motivated healthcare professionals to provide the services to meet patients' needs based on the best available evidence.

Thus, this current MediShield Life Scheme fulfils all these requirements. We have ensured that all people in Singapore are able to use the preventive, curative, rehabilitative as well as palliative health services that they need, which should be of sufficient quality to be effective without exposure to financial hardship. Regardless of whether they are able to afford the services, they should have access if they need it.

Mdm Speaker, I feel that we are a good way towards it, but there are still some existing gaps that may need some attention. First of all, many of the speakers before me have addressed about the issues of the financially weaker groups.

With the MediShield Life Scheme, the affordability as it is applied will cover the entire population especially with the help of Government subsidies. However, there will be some who are very unfortunate and still fall through the cracks. While this Scheme can be fully funded by Medisave, beneficiaries are still required to co-pay a certain amount of medical fees and there is a claim limit for certain medical procedures. I refer to homemakers and retirees who have little or no Medisave savings at all or expendable income. My concern also goes to families with children with chronic pre-existing conditions and childhood diseases. They will require long-term chronic care. If the parents are to exhaust their own Medisave, will they be able to cope in their golden years when they would need it too?

The Ministry should work closely with the non-governmental organisations (NGOs) and voluntary welfare organisations (VWOs) to identify these vulnerable groups for outreach as well as assistance. The Government should continue to provide generous subsidies to these groups even after four years when the Transitional Subsidies cease.

Next, I would have wished the Scheme to have covered some of the more important aspects of healthcare, mainly palliative healthcare, outpatient mental healthcare and preventive healthcare.

Palliative healthcare has, in the past decade, been growing in prominence. In developed countries where healthcare systems go beyond the basics, palliative healthcare forms part of the coverage. Nobody gets left behind as long as he or she lives. The concept of palliative care becomes important to ensure that a dying patient passes on with dignity and reduced suffering. Palliative care can sometimes take a long time, relatively speaking. It is not just about medication, but the cost of stay in a hospice can be a drain on a family's financial resources.

In Singapore, the demand will grow with our ageing population. Our elderly patients could face difficulty in the cost of funding their last journey in their life. In Japan, with its rapidly greying population, palliative healthcare is already covered under their National Health insurance system. In 2014, the World Health Assembly in Geneva passed a resolution calling for integration of hospice and palliative care into national health services, further reiterating the relevance of palliative care to quality healthcare. I urge the Minister to consider the inclusion of palliative care under the MediShield Life Scheme.

The other aspect I would like to talk about is outpatient mental healthcare. We can do more to help those with mental problems requiring long-term treatment. I am heartened to note that this Bill will cover hospitalisation expenses incurred from treatment of pre-existing mental illnesses. However, many mental diseases do not require hospitalisation. Instead, the patients do require follow-up consultations and will take prescriptive medicines, often on a long-term basis. This can come up to quite a tidy sum for the average family. The cost of treatment will discourage one to continue treatment, which can lead to very serious consequences. Therefore, I urge the Government to provide improved protection for this group of patients and their families.

The third aspect is preventive healthcare. Prevention is always better than cure. It is often emphasised that we should take personal responsibility to take care of one's health which is the best way to keep healthcare affordable. Getting Singaporeans to go for health screenings has always been a challenge, more so for the low-income groups who would consider health screenings as an unnecessary expense or a luxury. If health screenings for common diseases could be covered under the scheme, more will be inclined to go for regular health check-ups. In turn, this could lead to reducing the demands on our health services. Besides, if one is diagnosed early the recovery rate improves and the person will have a better chance of recovery and continue to be economically productive.

I would like to share about the German experience on preventive healthcare screening. In Germany, people who have statutory health insurance have access to selected types of screenings for free at a specific frequency when they are of a certain age. These tests include general check-ups, skin cancer screening, cervical cancer screening, mammography, endoscopy of the bowel and so forth, to identify commonly diagnosed cancers in the country. Preventive healthcare is something we need to look into seriously as we prepare for the long-term battle against rising medical costs.

Last but not least, dental and eye care preventive screenings should also be considered for coverage as these are common concerns in old age that can escalate to more severe ailments. Yet these are often not given the due care until it is too late. They are also avenues where symptoms and signs of more serious health implications might be identified. While other countries typically do not offer coverage under their national health insurance schemes, under the National Health Service (NHS) in England, the vulnerable and low-income groups do get access to free dental care as well as eye tests.

In conclusion, MediShield Life has some way to go to be considered as fully universal health coverage. It is a bit restrictive in terms of coverage, but I do hope that more can be done to expand the variety of conditions that can be covered. Nevertheless, for the affordable annual premium supplemented by financial assistance for those who need it, it is a comprehensive plan that offers decent life-long protection for the majority. The healthcare systems in Western and Northern Europe are often envied as many components are available to the beneficiaries for free. But let us not forget that working adults there pay significantly higher taxes than we do, much of which go into social security.

We must be realistic and understand that a free stellar-quality healthcare system simply does not exist without a system whereby funds are obtained from the public sector. It is also evident from global trends that healthcare costs will definitely climb. Aside from improving our social safety nets, it is prudent for us to encourage preventive measures by including coverage under this scheme, raising health awareness and continue to provide tools to develop a nation that is proactive in keeping fit and staying disease-free. With that, I support the Bill.

3.30 pm

Mrs Lina Chiam (Non-Constituency Member): Mdm Speaker, I am in favour of the revised MediShield Life Scheme which seeks to provide a compulsory medical insurance to give the pioneers better peace of mind and comfort about their healthcare bills and ease the burden of caregivers and family members. We believe that the aged will always rely heavily on long-term care services. It is a step in the right direction, like what Mr Png Eng Huat said.

However, in the former and current proposed MediShield programme, medical coverage still does not sufficiently cover the predictable wear and tear operations due to ageing. This is because MediShield plans have a high deductible of $1,500 to $3,000, which is the only item unchanged in the new proposed Scheme. Operations such as prostate, gall bladder, stents, knee replacements and so on, are the types of operations people need most and are likely to suffer from as we age.

When MediShield was first introduced many years ago, it was designed to cover catastrophic cases like cancer. Now, the Ministry of Health (MOH) is aiming to make it a universal healthcare system. But the question is: has the coverage increased such that it covers most of the operations you would encounter as you age? While universal coverage under the new MediShield Life will benefit insurance holders, it also implies higher premiums.

With MediShield Life, while the elder generation may be provided with relatively lower premiums than the rest of the age brackets, the cost of the subsidies is being passed on to the younger generation. This in turn depletes the Medisave funds of the younger generation and is simply passing the buck to future generations.

Ailing elderly people will need to utilise their children's Medisave accounts to pay the deductibles, which could deplete all their children's Medisave savings and become a problem that snowballs as each generation has fewer children and individuals will find it harder over the years to pay for the increasing premiums due to medical cost inflation and increase in age.

How does the Government plan to help the two-third lower-income group with the premium rises after the transitional period of subsidy is over in 2019?

Would premiums increase yearly to as much as 189% by 2019, bearing in mind that there are over 1.65 million or 45% inactive CPF members out of 3.53 million CPF members who may not have sufficient money in their Medisave account to pay for MediShield Life premiums or should the unemployed have lesser schemes than the employed?

How are the self-employed, retirees and housewives who do not have sufficient Medisave balances going to pay for themselves?

Furthermore, Dr Amy Khor had said to the local media that the permanent subsidies for lower- and middle-income Singaporeans needing help with their MediShield Life premiums will be given out automatically as far as possible to keep premiums affordable for all by using one's household income per capita as the determining factor. But why is one's household income per capita used as the determining factor instead of one's individual income?

While a family will help to contribute to a family member's medical expenses or premiums, overburdening the family might lead to conflicts between the family members. In my opinion, there should be a plan for a "cut-off age" for MediShield Life's premium payment. A reasonable "cut-off" age, like 80 years, should be applied.

For those above 80, they should still be covered without having to continue paying the premiums especially if they no longer have any source of income and every cent in their savings is needed for their living expenses.

As a compulsory insurance medical scheme which spans the entire population, the premiums should be much lower than the existing MediShield premium provided by the private insurers.

The actuarial study on MediShield should be made public so that we can see whether future projections of premiums to claims will continue to give yearly surpluses since the MediShield started.

Through information released by the Minister for Health, Mr Gan Kim Yong, in 2011, it was revealed that the MediShield surplus between 2001 and 2010 was $850 million and in 2011, only $280 million of MediShield claims were made. Given the figures of the surplus collected by the Government, is the financial estimation for premium collection excessively high, putting unnecessary financial burden upon the insured?

And does MOH intend to put the surplus from the MediShield funds for the healthcare use or simply into the Government's reserves? Also, does the projections by MOH on the premiums, take into account the $2 billion the Government would be putting into the MediShield Life Fund Scheme?

I would like to suggest all excess premiums collected should be ploughed back to the MediShield Life Fund under clause 7 of the Bill to help lower the premiums payable by Singaporeans and Permanent Residents (PRs).

There is a recovery action from defaulters leaving Singapore under clause 16 of the Bill, which states that the Police and the Immigration and Checkpoints Authority (ICA) have powers to arrest and prevent the defaulter who is about to or likely to leave Singapore if they have not paid all the outstanding premiums or furnished security for the payment.

Again, the Minister for Health, Mr Gan Kim Yong, in his reply to my question about arrears in patients bills at restructured hospitals said that there were about 136,000 bills of $48 million in total arrears outstanding for two months or more in the first 10 months of 2011. However, in his reply to me, Mr Gan did not elaborate on how much the 23,120 bills in arrears by foreign patients amounted to.

Is this particular clause for recovery action a response to growing arrears by medical tourists to Singapore? And on that point, are Singaporean patients paying the bad debts of medical tourists in terms of increased healthcare costs charged by the public and restructured hospitals?

According to CEIC Data, healthcare costs in Singapore have risen faster than inflation in recent years; up about 40% since 2000, compared to just over 25% for consumer prices. Therefore, with healthcare costs at such a high rate of increase beyond the interest rate offered by CPF on Medisave, would the younger generation of Singapore today face a much dire situation compared to their parents?

Will the Minister consider forming a committee to look into the impact of rising medical costs in an otherwise uncontrollable medical industry with runaway medical fees?

There is an immediate need to control and cap medical fees charged by public and restructured hospitals.

The discretion to force payment of MediShield should be the responsibility of an independent board, looking at all the financial circumstances. In normal course of events, defaulting should not happen since it is tied to the collection of CPF.

Under clause 11 of the Bill, the CPF Board is allowed to engage legalised debt collectors to collect the outstanding premium payments. In light of the questionable collection practices by such debt collectors, as shown on social media, would CPF Board take any precaution to prevent its agents from putting unnecessary pressure and trauma to collect debts from citizens who have financial difficulties in paying premiums for MediShield?

Also, why should penalty charges be imposed upon non-payment which would further worsen the financial status of those in need?

These are areas in the Bill that need to be carefully reviewed.

To be a truly inclusive society, no one should be left out of insurance coverage because of one's inability to pay premiums or to be financially handicapped from costly medical bills. This brings me to the point of premium loading in the Bill. Given that MediShield Life Scheme is a Government-initiated and non-profit insurance scheme, why are citizens penalised for their pre-existing conditions? The very idea of a compulsory nationwide insurance plan is to allow fellow citizens to chip in to help those in need and not to leave people born of poor health to their own means.

In conclusion, the Singapore People's Action Party places a very high premium on the health of all Singaporeans for all illnesses. Perhaps it is time for the Government to take real responsibility over medical cost issues and not simply stop the buck at the citizen level. Also, the provision of affordable healthcare facilities must be accepted as a social responsibility by the Government, and I believe promoting healthier lifestyles is more important than the best insurance schemes. Mdm Speaker, I support the Bill.

Mdm Speaker: Order. I propose to take the break now. I suspend the Sitting and will take the Chair again at 4.00 pm.

Sitting accordingly suspended

at 3.41 pm until 4.00 pm.

Sitting resumed at 4.00 pm.

[Mdm Speaker in the Chair]: ####

Medishield Life Scheme Bill: Debate resumed.

Er Dr Lee Bee Wah (Nee Soon): Mdm Speaker, this insurance Scheme is one which is widely welcomed by the community. It is very broad and, most importantly, it offers comfort to all Singaporeans by uncapping the age limit and also by including pre-existing health conditions. These are very important elements because if there is anyone who needs medical insurance more than others, it will be the people who, in the past, could not qualify for insurance because of their old age and their pre-existing medical conditions.

I would like to take this opportunity to share with this House two concerns that are consistently brought up by my residents.

First, there is a group of residents who shared with me that they currently have medical insurance and when they bought the insurance, they were healthy, and subsequently, they have some illnesses. They were saying that now, with MediShield Life, they have pre-existing illness. When they bought the previous insurance, they were healthy. So, their concern is on the loading of the premiums. So, perhaps, this is something that I hope the Ministry can address.

The next concern are those retirees. I meet a lot of retirees in the coffee shops, almost every morning. They sit there "lim kopi" (drinking coffee) and in the evening, perhaps one or two bottles of beer. They never think of buying health insurance and to them, they never think beyond what is tomorrow. So, they just enjoy their simple life. And they say that now we make it compulsory, they will have to find money to pay the premium and they are very worried about the jail term when they do not pay the premiums. So, these are the two main points that my residents have been bringing up to me.

And I note that the Bill spells out very clearly all the penalties to punish those who provide false information and those who default on their premiums.

I hope the Government, in implementing these provisions, will do so with compassion. We should have a platform where those who are unable to pay their premiums can turn to for counsel and guidance before they are hauled up to Court for defaulting on their premiums. Give them the help they need.

I am particularly concerned about the provision of giving the authority the right to proceeds in a joint bank account and to any immovable property. As we know, when a marriage or a relationship is bliss, couples, husbands, wives and even children will happily set up joint accounts, joint ownership from bank accounts to all types of properties. But not every joint account is a true joint account in the sense that both are contributing equally financially . We have seen in many divorce cases, for example, where a spouse would complain that the husband or wife never contributed financially to whatever purchases – movable and immovable. So, if we just follow the spirit of the legal definition of a joint account, then the innocent party would be penalised unfairly.

Thus, I hope the Government, in implementing the law when it comes into force, pays close attention when it seeks to recover the premiums from defaulters.

Next, I would like to the raise the question of a situation where a patient is subjected to various medical tests. In the event that the patient later discovers that he or she was sent for the wrong tests or treatment, what will happen? The claims have been paid by insurance. Will the doctor or hospital be made to refund the money? Medical error is something that we do not want to happen, but it does happen.

Also, I would like to ask the Minister: will the insured have to pay for medical reports that are required for the submission of a claim to the insurance company? There are medical clinics where patients are asked to pay from $30 to $50 or more for medical reports to support insurance claims. These are not reports that a doctor has to generate specially for the patient but are reports that are already in the patient's file, for example, blood test results, biopsy results and so on. All they need is to make photocopies and perhaps sign off. Currently, some clinics ask for what they call "administrative fees".

In conclusion, I believe MediShield Life is a good initiative. But we have to make sure that the detailed implementation does not cause unnecessary fear or burden to our people. Madam, I support the Bill.

4.05 pm

Dr Lily Neo (Tanjong Pagar): Mdm Speaker, I stand in support of the MediShield Life Scheme Bill. I would, however, like to raise my concerns over several issues on this Bill.

This Bill provides and requires the timely payment of premiums coupled with penalties for late payments. The annual premiums can range from only $130 for those who are young to as much as $1,530 for those who are older than 90, and, although there are Additional Premium Support and various subsidies available for the less well-off, there is still a likelihood for some needy folks to default on premium payments. They, especially the older people with high premiums to pay, will then fall through the cracks of the Scheme. The Ministry of Health (MOH) must spare no effort in assisting them in such instances. Those with depleted Medisave balances in spite of Government top-ups are vulnerable. This group may have exhausted their Medisave due to their multiple medical needs either through private clinics or Government hospitals. May I ask the Minister whether Medifund can, if necessary, be used to pay for the premiums of those in dire need?

Madam, may I ask whether MOH is intending to exempt Permanent Residents (PRs) who are residing abroad from paying MediShield premiums? If so, would MOH not consider this as unfair to the others, considering that these residents may choose to truly reside permanently here later in their lives when their need for medical care will be greater? They will have full use of the MediShield Life Scheme without having to pay premiums that were normally due.

Mdm Speaker, it is likely that the majority of Singaporeans will not require intense use of hospitals or claim the use of MediShield when they are younger and usually healthier. The prevalence of chronic conditions and the incidence of serious illnesses rise with advancing age, resulting in more frequent need of inpatient hospital services and care. This is especially true in the last few years of life when a final illness very often requires one or more hospital stays. This is the period when the cost of medical care will be at its highest and it is for this eventuality that people take up health insurance. It seems that non-premium-paying PRs residing overseas will be taxing our system if they choose to come back when their medical needs are at the highest. In fact, this Bill may encourage them to do so because, after all, we do have a high standard of medical care and, of course, with this Bill, we will also have MediShield Life Scheme. Since MediShield Life is a universal policy, there should not be preferential treatment for PRs with premium-paying exemptions. It would be better to give the non-resident PRs the choice to be in the MediShield Life Scheme or to withdraw from it completely. If they withdraw and are not paying the premiums anymore, they cannot expect to be covered under MediShield Life ever.

Under the Bill, it is an offence to knowingly provide false or misleading information or omit material information. Individuals convicted of such offences may face up to $5,000 fine or 12 months' imprisonment or both and additionally be required to pay penalties pegged to the amount of premiums undercharged or benefits or claims overpaid. Madam, my concern is for those who may have omitted in declaring due to lapses in memory or lack of information. For instance, he or she may have had a "minor" operation for a then "non-serious" condition 10 or even 15 years earlier, which he or she had forgotten. There are also situations when patients were shielded from the real diagnosis of their diseases, especially cancer, from their loved ones and leaving them unaware of their own conditions. They would have then declared incorrectly rather than trying to withhold medical information.

Those with pre-existing conditions need to pay 30% more of corresponding MediShield Life premiums for 10 years. This Bill gives the CPF Board the power to access medical records of patients, presumably, from the health records of Government institutions. What about those who do not visit Government hospitals and may have medical records only with private hospitals or hospitals overseas? Even for those with local medical records, the records may not be comprehensive enough to capture all their conditions, especially when they have multiple medical illnesses being treated by various and multiple doctors. In this respect, what scheme is in place to ensure the capture of relevant medical records? This is an important factor to ensure the equitability of MediShield Life for its viability and sustainability in the long term.

As in any insurance scheme, its long-term sustainability is paramount. The young subscribers will expect to have the proclaimed benefits of MediShield Life when the time comes for them to tap on it. May I ask the Minister how far is the planning for this MediShield Life? Will it be good for at least two or three generations of Singaporeans? Although the Government is putting in $4 billion into the Scheme presently, we cannot expect this subsidy to be perpetual as it has to depend on good economic growth. Therefore, will MediShield Life be robust enough, taking into consideration our fast-ageing population, for the future when we will have exponential risks for medical care? Has MOH done any postulations to chart the sustainability of MediShield Life with the ever-increasing expectations of our people and the increasing availability and costs of new medical technologies? Should some basic tenets not be in place from the beginning to address these concerns on sustainability of MediShield Life? In car insurance, there is a "no claims bonus" component; what similar scheme can there be for MediShield Life?

Mdm Speaker, I have always been an advocate of preventive medicine and I feel that there should be some incentives built into MediShield Life towards encouraging the tenet of "prevention is better than cure" and for people to take the route of "it is better to keep fit and healthy rather than to depend on the use of MediShield Life".

4.14 pm

Mr Baey Yam Keng (Tampines): Mdm Speaker, the MediShield Life Scheme has been well-received and is enjoying widespread support. Universal coverage for life based on cost sharing and risk pooling is welcomed for the peace of mind it provides.

Madam, understanding and remembering the details of one's health insurance will not be easy. In fact, it is probably easier for most of us to do our taxes, partly because it is something we do once every year. Insurance claims, on the other hand, are much less frequent and occur during stressful periods. As MediShield Life affects all Singaporeans, it is very important that we help everyone understand the mechanics of the Scheme. How we communicate this national insurance scheme is very important.

The Pioneer Generation (PG) Package has taught us many valuable lessons in this regard – how to minimise misunderstandings, how to communicate most effectively using various languages and dialects, how to utilise different platforms to reach different groups, particularly the vulnerable ones and so on.

But compared to the PG Package, MediShield Life affects a much larger group of people as well as subsequent cohorts. Every Singaporean will be covered from birth. It will be something that our next generation will be born with. As a baby, a child, an adolescent or even a young adult, one may not be fully aware of what MediShield Life is, what it covers, the rationale of risk pooling, because it is the parents who will pay the premiums and make the claims. Over time, there will be refinements to the Scheme, premiums will be adjusted. Public education, hence, must be ongoing, continuous and as in advertising jargon, "as sticky as possible". While setting the right policies in place is important, I would like the Minister to share how the Government intends to keep the public abreast of updates and changes over succeeding generations of MediShield Life members.

Next, I would like to seek clarifications regarding premium payments for young adults. The Government provides every Singaporean newborn with a Medisave grant of $3,000 which can be used to pay for his premiums. Using the MediShield Life premium for high income in 2019, the total premiums from birth to age 21 would be $2,795. Most likely, the amount would be higher as premiums would likely increase over the next 21 years. This amount will almost exhaust the $3,000 Government grant at age 21, provided that the grant is not already utilised for other medical expenses.

At this age, most young adults are still not financially independent. With the Ministry of Education's (MOE) target to provide 40% of each cohort a chance to study at local Government universities, many will still be studying or serving National Service (NS). Others may still be looking for jobs. In addition, there are others who are unable or unwilling to work. How are they going to pay for the premiums if they do not have CPF contributions? How will the Government recover the premiums? Will the premiums be automatically deducted from their parents' accounts? How about children who are living off their parents financially without valid reasons? How does the Ministry intend to balance the interest of the child, parent, the state and other MediShield Life members?

The other question I have is regarding instances where a policyholder becomes hospitalised after defaulting on his payment and the Government is in the process of recovering the outstanding premiums. During this gap period, is the policyholder still covered under MediShield Life?

Finally, a clarification for our Pioneers. The Pioneer Generation (PG) receives annual Medisave top-ups of $200 to $800 depending on their birth cohort. Some of them had expressed their concerns that the annual top-ups are fixed but the premiums would increase with every succeeding age cohort.

We have given assurance that PG members above 80 years old last year do not have to pay cash for their MediShield Life premium. Indeed, an 81-year-old PG member this year can use the annual Medisave top-up of $800 to pay for the subsidised annual premium of $566, with a balance of $234 to spare. However, a 61-year-old PG member already has to pay an additional $289 on their annual Medisave top-up of $200 for the $489 subsidised annual premiums. However, when they turn 80 years old, their premium would go up to $566, assuming the premiums do not increase, but their Medisave top-up remains the same at $200.

As these PG members get older and typically more financially dependent, their burden becomes heavier with MediShield Life. So, on their behalf, I would like to seek the Minister's reassurance that they will remain covered under MediShield Life. With that, I support the Bill.

4.19 pm

Ms Ellen Lee (Sembawang): Mdm Speaker, I will be speaking in Mandarin.

( In Mandarin ) : [Please refer to Vernacular Speech.] Mdm Speaker, MediShield Life is a scheme which will benefit all Singaporeans, including those who are not able to buy insurance because of pre-existing conditions. This Scheme is based on the concept of everyone working together on something that can benefit all.

Community grassroots leaders told me that some residents had reservations on the Scheme, especially with regard to the premiums. We all know that since the financial crisis, the recovery of the global economy has been slow, and our economy faces many challenges. Many people are uncertain about their job and future income, especially the lower-income workers whose qualifications are not high and computer knowledge is limited. The affordability of the premiums has brought about a great deal of pressure on them.

Although the Government has given the assurance that premiums will not increase for five years and the Government will not raise taxes to cover the subsidies given, some people feel that as inflation is unpredictable and work is becoming more and more uncertain, the cost of living will definitely go up. The cost of looking after the sick and elderly at home and children's education makes people worry that after five years, they will not be able to afford the premiums. Some people say frankly that after paying the monthly mortgage and other expenses, there is no cash left in their pockets. And if they need to pay the premiums in cash, there would be a problem.

On the other hand, some people ask, "If I do not have health problems and do not need to use the medical insurance to pay for the hospital bill, is it not a waste of money to join the Scheme?" Those who hold this view feel that they should have the right to decide on how to make use of their surplus funds and to invest in products with reasonable returns. Perhaps they believe that the premiums paid over the long term can be used for commercial investments to obtain better returns and they do not need to rely on the insurance scheme to look after their health.

These doubts do not just come from one single age group. There are some young people as well as older people who do not quite agree with the basic concept of this Scheme. So, we need to educate our people that only when everyone participates in the Scheme can we achieve the ideal effects of this unique public policy.

Our people should realise that the premiums will depend on the number of people insured and the structure of the population will have to be taken into account when calculating this complex formula. If you want everyone to benefit, we then have to involve all Singaporeans. As a part of our country, we should put our collective interests in the first place. We should not be so calculating and penny-pinching for our personal interests. The success of Singapore is built on a clean and efficient Government and Singaporeans should cast a vote of confidence in the reasonableness and sustainability of the policy.

The Government will continue to pay attention to the low income and the disadvantaged, as it has always been doing. I support this Bill wholeheartedly.

4.24 pm

Assoc Prof Fatimah Lateef (Marine Parade): Madam, the MediShield Life Scheme Bill is a bold move on the part of the Government. It is a major undertaking with a progressive, long-term vision for the management of healthcare cost.

I have a few points to bring up. First, MediShield Life is about being as inclusive as we can. Those with existing medical conditions, who have found it a challenge to get insurance coverage, now have an avenue to assist them. The front loading of 30% for the first 10 years is a reasonable amount compared to what such patients with end-stage renal failure, diabetes mellitus and its whole range of complications and those on chemotherapy, for example, will be utilising in the long term for healthcare cost, now that the ceiling for claims has also been removed.

My interaction with such patients has generated expressions of relief, thus far, these have also been some of the major concerns for this group of patients. But can the Ministry of Health (MOH) also let us understand a bit better about the existing medical conditions that will be covered? For example, mental illnesses, congenital diseases and palliative care as well as long-term care. Some of these questions have been raised by people who fall into these categories.

Madam, with reference to Part 2, section 4, subsection 3 on premiums, can I clarify on the definition of "parent"? In the context of, for example, a single lady who is not legally married but has decided to have a child of her own, what will her status be and responsibility to that child? The same clarification would also be needed to understand her role and responsibility when it comes to "refund" under section 4, subsection 5 and the definition of "child", as in the Bill, as it currently stands, the definition provided does not really encompass this definition.

Also, can the Minister please explain in a situation where we have an adult child more than 21 years of age who has mild mental sub-normality but is not registered as a disabled person and, of course, is not working as well, who is being looked after by his parents, who will be responsible for the premiums and who will pay when he is 21? What happens if his parents are in the low-income category? What will also happen if his parents pass on?

Next, pertaining to data confidentiality, will the additional, non-medical personnel who will be handling personal information such as healthcare-related information, salary and so on be required to sign an undertaking or agreement? This may now include more staff in the administrative office as well as other clerical staff.

For the Additional Premium Support, I assume this will be means-tested. Can the Minister please clarify if support will be disbursed as per the current sliding scale already in use and in existence in our restructured hospitals and Government institutions? If it is different, then we will have to brief the staff.

Can I also find out if we can have some frontline booths set up at our Government institutions, which is similar to the ones that we set up for our Pioneer Generation Package to assist with clarifications and explanations, especially in the initial period post-implementation?

For the premium subsidies, those who are already in contact with the public healthcare system would likely have their information available and updated. Does this mean that the subsidies will then be automatic? How about those who have never been in contact with the public health system or have only sought treatment at private institutions? Will they have to apply for the subsidies? And if so, what would be the application process?

For those who are still employed and their companies offer portable medical benefits, how and can these ride on the MediShield Life Scheme? Will there be some steps that they will have to go through, for example, notifying the CPF Board or MOH?

On the formation of the Council, can I confirm that members appointed will also need to sign a confidentiality agreement in view of the type of information they will be handling and have access to? Also, how many members will be on the Council? And I do hope it will comprise of the relevant and appropriate representatives.

On the penalty for late payment, can I ask the Minister for an explanation of how "the total amount of penalties imposed on the premiums and interest for an insurance period must not exceed 17% of the total amount" was arrived at? Also, what is the definition of "an insurance period"? Is it a year?

Pertaining to the action to be taken against those who do not pay their premiums or default, when exactly will the action be taken? It does not seem cost effective to me for us to go after those who default on one or perhaps two premium payments, as the cost of the proceedings may be significantly more than the total cost of the premiums owed to the CPF Board.

On Integrated Shield Plans, where many are actually looking forward to the announcements, when can we expect the details to be out and what is the Ministry's view on the use of "risk loaded" policies?

Madam, currently, HIV and AIDS patients can use their Medisave accounts for payments but not MediShield. With MediShield Life, will we see some liberalisation in this area? I ask this with respect to those who acquired this not due to lifestyle reasons but perhaps from blood transfusion or in the case of maternal to child transmission, out of no fault of their own. Perhaps the Ministry can consider this on a case-by-case basis.

Finally, for Singaporeans living overseas and they will, too, be covered by this compulsory Scheme. I would caution that we have to monitor the numbers who would suddenly come back to get treatment here because of the MediShield Life Scheme, for example. I am not sure what numbers we are talking about.

Madam, in Malay, please.

( In Malay ) : [Please refer to Vernacular Speech.] The MediShield Life Scheme will bring many benefits to Singaporeans with its wider and better coverage.

It can firstly be used to pay hospital bills with its higher claim limits; secondly, it functions with the absence of lifetime claim limits for more types of illnesses; and thirdly, it can be used to pay for the cost of treatments like chemotherapy, dialysis and others.

If we look at it, this is very important, especially to the Malay community, where firstly, many do not have any other insurance plans. Secondly, many also have chronic diseases, for instance, the proportion of diabetes, hypertension, stroke and heart disease is very high in Singapore. All these increase the risk of our Malay community having damaged kidneys and other diseases. Thirdly, many also are within the low-wage and low-income group.

For most Singaporeans, the premiums for MediShield Life can be sufficiently funded by their Medisave. This includes the Medisave top-ups by the Government and subsidies for the needy. There are also benefits and subsidies for the Pioneer Generation (PG). For those with difficulties paying premiums, the Additional Premium Support can also be considered.

For the first four years, the transitional subsidy will also be provided.

Therefore, I would like to urge the community to find out in detail about the benefits that they can get from the MediShield Life Scheme. If there are dialogue sessions, please attend it with your family and neighbours to understand it together. For those who are better off, ask yourself, if you have MediShield Life now which covers bills for Class B2 and C wards, would you still need to get Integrated Shield Plans? Or can that money be used for other payments that have priority in your life? For those who are younger, think also about how this scheme can support your healthcare costs up to your golden years.

Make use of this Scheme reasonably. Just because there will be MediShield Life, I hope that we will not see more people going to the hospital for conditions that do not require inpatient treatment.

( In English ): I hope MOH will continue to monitor the Scheme closely, including the administrative costs for such universal health coverage for our entire population. It is expected to rise. The sustainability of the Scheme is also important and critical because as we move along, our population will age and certainly the number of economically active people will drop. These are some of the challenges that we may face in the coming years.

Mdm Speaker, the most important assurance is that the Government will keep cost and the premiums affordable, and those who require assistance will be assisted. That is as good a promise any scheme can ever provide a population. I support the Bill.

4.34 pm

The Minister of State for Health (Dr Lam Pin Min): Mdm Speaker, I am happy to hear the warm support from Members for the universal coverage and protection that MediShield Life will provide to all Singaporeans. Universal coverage is a key feature of MediShield Life and is a big step forward in providing greater assurance and coverage for all, for life, including those with pre-existing conditions. Let me elaborate on Ministry of Health's (MOH) approach to this.

When MediShield Life is introduced at the end of this year, universal coverage for all Singaporeans will become a reality. Under MediShield Life, insurance coverage will be extended to those who are currently uninsured or are excluded from coverage today due to pre-existing conditions. No Singaporean will be left out of MediShield Life.

With universal coverage, there will be higher costs for MediShield Life due to the higher expected claims from those with pre-existing conditions. This is estimated to a total of $1.1 billion over the first five years of MediShield Life. The MediShield Life Review Committee had recommended the following approach towards bringing in those with pre-existing conditions under MediShield Life which was accepted by the Government.

First, to ease the shift to MediShield Life and ensure that the premiums impact is manageable for all other Singaporeans, the Government will bear the bulk of the higher costs of universal coverage at an estimated $850 million over the next five years.

Individuals with pre-existing conditions will also bear part of the costs by paying Additional Premiums of 30% over 10 years to reflect their higher risks.

Lastly, all Singaporeans will co-share a small part of the costs as part of their premiums. This is in line with the philosophy of greater collective responsibility and reflects each person's contributions towards an inclusive society.

This approach that we will be taking to move towards universal coverage under MediShield Life strikes a balance between shared responsibility and inclusivity while keeping premiums manageable.

Some Members, including Mr Zaqy Mohamad, have asked whether the Additional Premiums of 30% over a 10-year period for those with serious pre-existing conditions would impose too heavy a burden on these individuals. I would like to explain that the MediShield Life Review Committee had made their recommendation on this issue only after serious and in-depth consideration of the extensive feedback from members of the public. The Additional Premiums strike a balance between reflecting the higher risks of those with pre-existing conditions while at the same time avoiding placing too much financial burden on them. In fact, to fully reflect the costs of their higher risks, individuals with serious pre-existing conditions would have to pay a lot more than 30% if it were not for the Government bearing the bulk of these costs.

Ms Denise Phua and Ms Lee Li Lian have asked if the Additional Premiums would continue to be required after 10 years. I wish to confirm that individuals, subject to Additional Premiums, will only need to pay these for 10 years. Following which, they will pay the same standard premiums as the rest in their age group regardless of their health condition at that time.

Most of these individuals with pre-existing conditions would not be able to purchase insurance from private insurers and would have been bearing high medical costs without any insurance protection over the past years. With MediShield Life, they can now be covered for life and receive help with their large medical bills. Many of them have told us how relieved they are that they can finally be protected and that they do not mind paying the Additional Premiums for the assurance of the peace of mind for life. Likewise, Assoc Prof Fatimah Lateef has also shared that her patients are looking forward to MediShield Life as they can now receive help with some of their large medical bills.

Let me share an example with the House. Mr Ong, 48 years old, suffers from end-stage renal disease. He does not have any insurance coverage. Currently, he pays about $700 every month for his dialysis treatment using Medisave and cash, which is a significant drain on his Medisave and cash savings. With MediShield Life, he will be able to claim up to $1,200 per month for his dialysis treatments and related drugs, or up to $14,400 per year. In comparison, the Additional Premiums that Mr Ong will need to pay for the year, before taking into account any Government subsidies that he is eligible for, is about $130 per year. Mr Ong will also benefit from MediShield Life coverage should he be hospitalised in future.

For Singaporeans who need help with their MediShield Life premiums, including the Additional Premiums, they can benefit from the MediShield Life subsidies that the Government will provide. These include Transitional Subsidies for all Singapore Citizens, Pioneer Generation Subsidies and Premium Subsidies for the low-to-middle income. For the needy who face difficulties in paying premiums even after subsidies, the Government will provide Additional Premium Support.

A few Members have raised questions about which serious pre-existing conditions will require Additional Premiums. MOH is currently reviewing the list of serious pre-existing conditions, with specialist advice from clinicians. More details on the serious pre-existing conditions that will result in Additional Premiums will be made known at a later date. There will also be separate notifications to individual policyholders who are required to pay the Additional Premiums.

I wish to emphasise Minister's point that we will take a fair and compassionate approach in the assessment for Additional Premiums. Our focus would be on the more serious conditions which require intensive medical intervention to treat or manage or have high risk of future complications or recurrence and therefore may require prolonged treatment. These conditions will result in much higher costs and risks to the scheme and should rightly incur Additional Premiums.

We have heard the concerns of members of public on whether they will be required to pay Additional Premiums even if their medical conditions are minor. These concerns could have arisen due to their previous experiences in purchasing private insurance plans.

I would like to highlight again that the MediShield Life approach for identifying serious pre-existing conditions will be different from and more compassionate than the approach used by private insurance schemes. For example, under MediShield Life, serious pre-existing conditions that may be subjected to Additional Premiums include stroke, cancer, kidney failure and heart diseases, just to name a few. Today, Singaporeans with these conditions will not even be accepted for coverage by a private insurer. On the other hand, less severe conditions such as pre-cancer, well-managed hypertension and diabetes with no complications will not be subjected to Additional Premiums as they generally have no long-term treatment impact.

Ms Chia Yong Yong asked if the rate of the Additional Premiums would vary according to the type of pre-existing conditions. There is only one rate – 30% for 10 years, and this will apply to those with the identified serious pre-existing conditions so that we keep the approach simple. Those who are assessed to be without these conditions will not need to pay the Additional Premiums.

Ms Denise Phua asked whether developmental disorders such as Down Syndrome and autism will incur Additional Premiums. I would like to reassure Ms Denise Phua that developmental disorders which do not result in higher risks of future complications or recurrence that require prolonged hospitalisation or expensive outpatient treatments will not attract Additional Premiums. In other words, the mere existence of autism on its own is not the basis for imposing Additional Premiums. However, if the person with autism also has a serious medical condition requiring prolonged hospitalisation or treatment such as dialysis, then Additional Premiums will apply on account of the serious medical condition.

With regard to Assoc Prof Fatimah Lateef's question on whether HIV/AIDS patients will be covered under MediShield Life, these patients will be covered under MediShield Life, subject to the MediShield Life benefit coverage for hospitalisation and selected outpatient treatments. As with other serious pre-existing conditions, those who were diagnosed with HIV/AIDS prior to the start of their insurance coverage will have to pay Additional Premiums.

I also wish to provide the strong assurance to Er Dr Lee Bee Wah and her residents that Singaporeans who are currently insured under MediShield or an Integrated Shield Plan and developed medical conditions only after their insurance coverage started will not need to pay any Additional Premiums. For example, if you have been covered by MediShield since you were born and developed cancer this year, you will not have to pay Additional Premiums when MediShield Life starts.

Many Members sought clarifications on the powers to access health records and financial information of patients. To minimise inconvenience to Singaporeans, the process of identifying individuals with pre-existing conditions will be made as convenient as possible so that Singaporeans need not undergo separate medical assessments or produce medical records. As shared by Minister Gan, the assessment will be carried out using existing medical information in Government administrative databases. These databases include the ones used to process various types of claims submitted by both private and public medical institutions. With these checks, the vast majority of Singaporeans will not have to step forward to undergo further health assessment or produce their own medical reports, as queried by Dr Lily Neo. For those whose medical records will be accessed under this approach, they will not need to undertake any statutory Health Declarations.

For those who feel uncomfortable with the Government accessing their medical information, they may decline access to their medical information. More details on how to do so will be released at a later date. However, as we will not be able to ascertain if such individuals have a pre-existing condition, therefore, to be fair to other policyholders, they will need to pay the Additional Premiums under MediShield Life. Should they change their mind, they can either allow access to their medical information, step forward to submit the necessary documentary proof like medical reports or submit statutory Health Declarations, as suggested by Mr Gerald Giam, for review and assessment. However, we also note that, as highlighted by Dr Lily Neo, some individuals could find it difficult to ensure that the relevant medical information is fully and correctly reflected within the Health Declarations.

In response to Ms Chia Yong Yong's question, for those required to pay Additional Premiums and who wish to step forward to seek a review of their health condition and Additional Premiums, for example if their health has improved significantly, they do have the option to do so. These individuals may have to undergo additional checks or request for updated medical reports from their doctor.

Madam, I will now speak briefly about Integrated Shield Plans.

About 60% of Singaporeans today purchase additional benefits and coverage through Integrated Shield Plans (IPs). We understand that many IP policyholders are not clear about how MediShield Life will affect them. Some are concerned that they will need to pay "double premiums" when MediShield Life is introduced.

We need to explain to IP policyholders that their Integrated Shield Plans today such as AIA HealthShield, Aviva MyShield, NTUC IncomeShield, Prudential PruShield or GE SupremeHealth already come with a MediShield component. An IP is made up of two parts – the MediShield component run by the CPF Board and the top-up component run by private insurers. The top-up component provides the additional benefits and coverage, for example, for Class B1 or A and private hospitals' hospitalisation. There is no duplication between MediShield and the IP top-up components today. You do not need to pay double. An IP policyholder pays one total premiums payment to his private insurer and the insurer will pass the MediShield portion of the premiums to the CPF Board to manage.

When MediShield Life is implemented, the MediShield tier in the IP will be replaced by MediShield Life. All IP policyholders will be covered by MediShield Life with no duplication with their current IP coverage. They will enjoy MediShield Life coverage for life as well as coverage for any pre-existing conditions, even if these conditions were excluded from their IP coverage. IP policyholders will therefore have greater peace of mind as they will continue to be fully covered by MediShield Life, even if they have exclusions on their IPs or decide to drop out from their IP plans later. To Ms Lee Li Lian's question, I wish to clarify that if IPs impose exclusion on an individual, this will not result in the imposition of Additional Premiums for MediShield Life if he had not been suffering from serious pre-existing conditions at the time that he joins MediShield Life.

Assoc Prof Fatimah Lateef has asked specifically about IPs and when MOH will share more details about developments in the industry arising from the Review Committee's recommendations. MOH is working with the insurers on various initiatives and more details will be shared when they are ready.

The Review Committee recommended that the Government allows private insurers to manage those with pre-existing conditions differently, including allowing for risk-loading. MOH will allow the insurers to risk-load policyholders with pre-existing conditions. We recognise that some policyholders may prefer to pay higher IP top-up premiums for the peace of mind that they are also covered for their pre-existing conditions by their IPs. We are working with the insurers to develop an appropriate framework. More details will be shared when they are ready.

Er Dr Lee Bee Wah had a question on whether the insured have to pay for medical reports that are required for the submission of claims to the private insurance company. Most IPs absorb costs of medical reports needed to make claims. However, as the private insurers would have differing practices, we encourage members of the public to check back with their IP providers whether there is a need to pay for the medical reports.

Many Singaporeans with IPs have sought our advice whether they should drop their higher coverage now that MediShield Life is available. This is a personal decision that each of you has to make for yourselves. However, I can offer three questions that can help to guide you in your decision-making. First, do you want to choose your own doctor or require an air-conditioned ward if you are hospitalised? If so, you may wish to consider an IP. Second, do you prefer to seek treatment at a private hospital or would a public hospital be sufficient? This would determine the type of plan you should buy. And thirdly, the consideration is that of affordability. Are you able to afford IP premiums in the long term, as IP premiums do rise significantly with age?

Madam, with universal MediShield Life, every citizen plays an important role in contributing to our national risk pool and benefiting from the lifelong coverage. This will further strengthen our social safety nets as we move towards building a more inclusive and compassionate society together. Mdm Speaker, I support the Bill.

4.51 pm

Mr Alex Yam (Chua Chu Kang): Mdm Speaker, as the 20th speaker of a very important Bill like MediShield Life, I run the risk of repeating everything that the hon Members before me have already mentioned. However, there are key points that bear repeating, so I do beg the indulgence of the House.

MediShield Life has loomed large on the landscape for some time. This is perhaps one of the rare pieces of legislation where the recommendations and publicity have been ongoing for more than six months since the adoption of the recommendations by the Government on 27 June 2014. I think it signifies two things: one, the importance that the Government places on this particular Bill, as well as the complexities of implementing it.

It is a Bill that is at once straightforward in its aim to provide comprehensive healthcare coverage for all Singaporeans, thus the tagline "Better Protection, For Life, For All." At the same time, the details are not that easily understood, much like any other insurance scheme that we have.

I first applaud the effort by the Ministry to really put out good quality publicity to engage especially those the Scheme aims to benefit most first – our Pioneers, the lower income, the uninsured and uninsurable.

Secondly, I think it is important to recognise that as a start, the Government is putting in an immense amount of effort to ensure that subsidies to lower- and middle-income families will mean two out of every three Singaporeans and permanent residents (PRs) will already benefit from universal coverage at lower premiums.

The burden of costs is also addressed through the Transitional Subsidies for premiums over the next four years, thus taking much out of the sting of suddenly having to pay for much higher premiums overnight.

The Bill does not make for easy reading. There is much information to digest and to get right. But credit must go to those drafting it for being as comprehensive as possible. I remember a particular section of the Bill that even mentions those whose birthdays fall on 29 February. That is the amount of details that the Committee that drafted this Bill had gone into.

There are a few areas, however, that I hope to seek clarification on. These are namely (i) premiums; (ii) the Integrated Shield Plans (IPs) that Dr Lam Pin Min has just mentioned; (iii) preventing artificial demand and supply; (iv) safeguards on privacy and (v) effective implementation.

First on premiums. Much has been said on premiums as well as the various subsidies put in place to soften the impact upon implementation of MediShield Life. Look at all the charts. I believe we can all be heartened that the subsidies do go a long way towards making it affordable.

However, I would like to seek the Minister's opinion on the possibility of further segmenting one group for Additional Subsidies, and this would be those in the one- to 20-year-old age group. At the moment, dependants below 21 years of age from lower-income families are grouped together with everyone up to 40 years of age. While the premium payable is lower, the current subsidy is pegged at 25% which is the same for working adults and everyone who has a young family. Even if we were to take the premium after subsidy as being $60 annually, this works out to $1,200 over 20 years which, though payable from the initial Medisave grant, is almost half of the $3,000 provided.

Therefore, I suggest that the subsidy level for those aged one to 20 be raised. Other people who would fall through the cracks and this has been mentioned by a number of hon Members earlier would include stay-at-home mothers, single elderly and those with disabilities including mental illnesses.

Another part of the premiums that I would like to enquire on has to do with Singaporeans who are living overseas or are intending to leave the country. The Scheme has been designed as being compulsory; however, are there exceptions? Under what circumstances will specific exemptions be granted; that is to say that premiums will not be required to be paid? And if the exemption is granted, can the person who has applied for this exemption plead for reinstatement into the Scheme and when will this be made possible?

More importantly, what is the basis for granting absolute exemptions if the Scheme is compulsory and for all? Because this will then detract from the mission of the Act to provide "Better Protection, For Life, For All".

Recovery of dues is also one area that I hope the Ministry will take a light touch on. The appointment of agents seems to call to mind debt collection agencies. As such, I do hope that this is the very, very last resort for the recovery of dues.

The second clarification is on Integrated Shield Plans (IPs). Dr Amy Khor, the Senior Minister of State for Health, in July 2014, announced that the Ministry is in talks with the Life Insurance Association and Dr Lam Pin Min has addressed this issue. The system of payment has been, of course, well addressed by the Ministry through various announcements and publicity but again, it bears repeating so that the record can be set straight.

While there are no lifetime limit differences for both MediShield Life as well as the IPs, there is a marked difference in the annual limits without even considering additional riders.

While the intention of MediShield Life will be to provide social equality in terms of healthcare affordability, we cannot ignore the fact that there may be perceptions of service gaps between those who opt for Class B2 and lower as well as perceptions that the quality and type of care may not be the same as those who are paying a premium.

I am glad that Dr Lam Pin Min has shared earlier that the details of the discussions with insurance providers will be made available soon. I do hope that the claim processes will ensure that better protection continues and does not translate into bothersome paperwork.

My third concern has to do with artificial supply and demand. As we already see with existing comprehensive insurance schemes both locally and overseas, there is an unfortunate conundrum that since you have already paid for something, you should use it more. For healthcare service providers, it may also encourage them that since this is being paid for by something else or someone else, the maximum value should be extracted from the Scheme.

This results in a buffet mentality in all sense of the word. One that patients may choose to go to the buffet line more often than actually required and for providers to charge a premium on ingredients and treatments since someone is already paying for the meal.

We have seen this to a certain extent with Community Health Assist Scheme (CHAS) as well as the Pioneer Generation (PG) Package. The Ministry and the Council will have to take a firm administrative look at how to avoid overburdening the healthcare system and the fund without compromising on the quality of care.

The fourth issue that has been touched on by many has to do with privacy. A sizeable chunk of the Bill is devoted to the disclosure of information, and I think there is a significant amount of public attention that has been focused on this. But it is somewhat unfortunate because it distracts from the huge amount of good that this Bill is trying to achieve.

I believe that there are already stringent checks in place to safeguard the privacy of information. Singaporeans have put their trust in the Government for the past 50 years. While a good apple keeps the doctor away, one bad apple in the system could undo all the goodwill accrued and the promises made will go to waste. I do urge the Ministry to look in-depth into the protection of privacy.

My last concern will have to do with effective implementation. Good intentions are easy, good implementation is hard. Take, for example, our CHAS as well as our PG Cards. Till today, there are still those who are not entirely sure which combination of cards to be used where and when. Concerted, sustained effort is required, especially for something even more complex than CHAS and PG which is the MediShield Life.

The setting up of a MediShield Life Council is most welcome. I urge that the Council be more than administrative in terms of reviewing premiums, but also serve as an appeals panel, much like that of the Pioneer Generation Appeals Committee so that those with special circumstances have a specific body to appeal to for consideration.

The success of MediShield Life requires all of us to take responsibility. It is a piece of legislation that will go a long way towards creating a more equitable society and one where no one is left behind – Better Protection, For Life, For All! Mdm Speaker, I support the Bill.

Mdm Speaker: Er Dr Lee Bee Wah.

5.01 pm

Er Dr Lee Bee Wah: Thank you, Mdm Speaker. I would like to seek clarification on Minister of State Dr Lam Pin Min's answer. I was asking about medical reports for those who claimed under universal MediShield Life, whether if there is a claim, do they have to pay for the medical report which some insurance companies may ask for? It is not those from the private companies. It is the universal MediShield Life.

Dr Lam Pin Min: I would like to thank the Member for the clarification. If the claim is under MediShield Life, then the CPF Board will undertake to pay for the medical report.

Mdm Speaker: Mr Hri Kumar.

5.01 pm

Mr Hri Kumar Nair (Bishan-Toa Payoh): Thank you, Mdm Speaker. This Bill goes into some detail of the MediShield Life Scheme – who will administer it, how the premiums will be recovered, how we will retrieve health information and so on. But while we go into the specifics, I think it is important that we remind ourselves the philosophy behind the Scheme, as that informs many of the provisions.

We are all familiar with existing social security schemes like CPF and Medisave. Essentially, these plans revolve around and depend on the individual. Each account holder is responsible for building up sums in his account to fund his own housing, retirement and healthcare needs. The individual takes care of himself.

MediShield Life is different. It is a lifeboat with all Singaporeans on board. There are no separate accounts. Everyone contributes and everyone benefits. For the lower-income, middle-income and the Pioneer Generation (PG) and pensioners, the Government pays the premiums, partially or even entirely. And for all of us, there are Transitional Subsidies. Some will of course benefit more than others. The elderly, those who are less well-off and those who incur higher medical costs may receive more than they contribute. But that is perfectly acceptable, because when it comes to healthcare, those who are more able should help others. We are in this together and it is not about who benefits more. I therefore fully support the principle of including every Singaporean in the Scheme, including those living abroad and those who may not require to be in on the Scheme. I likewise support having an effective and efficient system of ensuring that everyone contributes his or her share to the common pool does so and I hope the exemptions and exceptions will be few.

As we all contribute and share in the national risk pool, we should know how the Scheme operates and how it is funded. We certainly also have an interest in making sure that costs are reasonably contained. In this regard, I wish to make the following points and ask for the following clarifications.

First, the proposed section 4(2)(b) states that premiums payable by "other persons" may be deducted from an individual's Medisave account in circumstances to be prescribed by the Rules. It is unclear who these "other persons" are. So, the Rules will prescribe who "these persons" are and the circumstances which one's Medisave account will be debited to pay for the premiums for these "other persons". May I ask who these "other persons" are and who will be asked to pay? Further, will a person be entitled to object to such a deduction and if so, on what grounds?

Second, as the Scheme will already subsidise those who cannot afford to pay, there is understandably a need for a robust recovery mechanism to compel those who can afford to pay but fail to do so. Still, we should ensure that defaulters are not treated in an unduly harsh manner. I think that is the likely intention behind section 11, which provides that a demand note must first be served on the defaulter before further enforcement actions can be taken. However, it is not clear how much time a defaulter will have to remedy the situation. This can be contrasted with section 87 of the Income Tax Act, which states that if payment is not made within one month from the date of service of the demand note, the Comptroller may proceed to enforce payment. And I hope the Minister will address this point.

Third, section 15 allows the recovery body to sue for unpaid premiums. My concern is that this may not be a cost-effective way of recovering premiums. Given that monthly premiums will in most cases run into double digits, the outstanding premiums are not likely to be large, even if outstanding for some time. There is a real possibility that the cost of bringing proceedings will far exceed the sum owed.

I would like to ask the Minister what is the threshold amount owed before proceedings will be filed? And if the defaulter has no known assets, what then? I appreciate that the recovery body must, as a matter of principle and in fairness to everyone, take all reasonable steps to recover unpaid premiums. However, the purpose of recovery will be defeated should costs spiral beyond what is sensible.

Finally, Madam, a point on healthcare costs. Greater insurance coverage will be of limited help to Singaporeans should the cost of healthcare rise significantly as a result of this Scheme. What are the Government's plans to contain or manage healthcare costs in the years ahead?

A particular concern that arises in the context of insurance programmes is overconsumption. In the case of MediShield Life, the worry is that people will seek and doctors will prescribe, unnecessary treatment and medication. In particular, where doctors or medical centres profit from the sale of medicine or from procedures, there is every incentive to overprescribe or prescribe more expensive procedures and medicines. There will also be the need to administer this entire Scheme, which means more bureaucracy, more red tape and ultimately, more costs. Not only will this deplete the pool of funds, resources will be diverted from those who truly need them. So, I would like to ask what the Ministry intends to do to contain costs going forward.

Mdm Speaker: Ms Jessica Tan.

5.07 pm

Ms Jessica Tan Soon Neo (East Coast): Mdm Speaker, thank you for allowing me to speak on this Bill. Healthcare affects everyone. Young, old, rich or poor, healthcare is not something we can predict when we need it and neither can we predict the amount of expenses required.

MediShield Life will provide the benefits of healthcare protection for all Singaporeans and Permanent Residents (PRs) for life, regardless of our health status or our financial situation. It is a welcomed relief for those with pre-existing conditions that they will also be included in the Scheme. The Scheme requires that everyone co-shares in this risk pool. This is a big change both in mindset and approach as it requires all Singaporeans and permanent residents (PRs) to collectively participate and to share in enabling healthcare protection for all. The Bill sets out to establish the MediShield Life Scheme which enables this coverage for all to happen.

A permanent feature of the Scheme is the Government's support to Singaporeans with subsidies for lower- to middle-income and the Pioneer Generation (PG). To ease the shift to MediShield Life, there will be Transitional Subsidies over four years for all Singapore citizens. For Singapore citizens who are unable to afford the premiums even after the subsidies, the Government will provide Additional Premium Support.

This Bill sets out the delegation of powers to enable the administration, enforcement and facilitation of the disbursement of any grant, subsidy or benefit under the Scheme in relations to the persons concerned.

Madam, I support this Bill but would like to ask clarification from the Minister on several areas.

On the recovery of outstanding premiums, defaulters, penalty and offences. With the universality of the Scheme and the fact that it is compulsory, the Act provides the powers for the recovery of outstanding premiums, the prevention of defaulters from leaving Singapore, penalty and interest imposed for late payment of premiums. Defaulters will be liable to conviction of fine and imprisonment for leaving or attempting to leave Singapore without paying or furnishing security to the recovery body before leaving Singapore. These are wide powers and the consequences for the persons concerned for offences and default are severe.

As these responsibilities are not trivial and will impact every Singaporean and PR, I would like to ask the Minister what measures will be put in place to ensure that outstanding premiums do not build up or escalate? Will there be a process to ensure that if outstanding premiums are the result of a person's inability to afford the premiums due to their financial situation that there will be early intervention to provide the appropriate support? This will help prevent a situation of default or escalating amounts for outstanding premiums and the severity of penalties and offences. This problem could be further exacerbated when the persons concerned also have dependants whom they are required to pay premiums for.

As the Scheme applies to Singapore citizens as well as PRs, what measures will be in place if PRs are, for some reason, in financial difficulty when a sudden illness or financial situation happens in their families and they are unable to afford the premiums?

Obtaining and disclosure of confidential information. The Bill gives the CPF Board and authorised officers the powers to obtain and use confidential information of a person concerned for administration and enforcement of the Scheme. This access is required to allow the Board and authorised officers the ability to disburse or facilitate the disbursement of any grant, subsidy or benefit under the healthcare-related public scheme in relations to the persons concerned without having the onerous process of application and processing of applications for the Scheme and ensures that those who do qualify benefit from it.

While this may, at the onset, seem too intrusive, I do applaud the effort as it does simplify the process and will ensure that those who do qualify benefit from the various grants and subsidies without having to apply for them. Clause 29 subsections (1) and (4) set out the measures to ensure that the data is used for the purposes outlined in clause 27, subsections (1) and (2) and that data privacy is maintained for the persons concerned.

With the wide-ranging powers to obtain data without explicit consent, given the sensitive and personal information that is obtained, as this information pertains to personal health records as well as means data, I would like to ask the Minister what responsibilities will be required of the authorised bodies and persons who obtain and receive the data? What requirements will be in place for them to store, retain and dispose the data to ensure protection of the confidentiality of the data and that the data is only used and accessed for the purposes outlined in clause 27 subsections (1) and (2)? This is important for public trust, given the sensitivity of personal information obtained and the fact that the information is now shared and viewed in a holistic manner. Inappropriate access could compromise an individual and impact public trust.

Opting not to allow access to confidential data. The Bill does allow for persons concerned to opt out and to refuse access to the provision of health information for the purposes of clause 27 to assess whether premium loading for pre-existing conditions and or the provision of means information for the purposes of clause 28, to assess eligibility for any grant or subsidy of benefit from a relevant public scheme. By opting out, the person concerned will however not be eligible for income-related subsidies for their premiums nor can they automatically be considered to have a clean bill of health.

Both the Minister as well as Minister of State Dr Lam have clarified that a person who opts out can, for either of the instances, opt in at a later stage. Can the Minister clarify as to how this will be done? Will they be able to benefit from the applicable grants and subsidies? And if so, how will this be assessed? Will it be backdated or pro-rated from the date of application?

For Singaporeans living overseas, how will premiums be calculated and determined? What happens when there is a situation of outstanding payments? Can the Minister clarify how this will be handled?

Madam, in conclusion, I would like to say that healthcare and healthcare affordability matter to all Singaporeans. This Bill facilitates the establishment of the MediShield Life Scheme to enable collective responsibility of all Singaporeans and the sustainability of the Scheme. As the Minister has outlined in his speech, the Scheme sets out to strengthen the collective responsibility of Singaporeans and the Scheme also sets the tone of the inclusive society that we want to build in Singapore. What is most important now is that it be executed well and that we ensure that all Singaporeans benefit from this healthcare coverage. Madam, I support the Bill.

Mdm Speaker: Ms Chia Yong Yong, do you wish to make a clarification?

5.14 pm

Ms Chia Yong Yong: Thank you, Madam, I wish to seek clarification from the Minister of State. I think my earlier request for clarification in relation to the appeal was not just in circumstances where the condition has improved but also when the classification is made and the decision to impose premium loading is also made. At that point in time, is there a mechanism for an appeal to be lodged?

Dr Lam Pin Min: I would like to thank Ms Chia Yong Yong for the clarification. As long as the policyholder has been assessed through the various databases that, indeed, he or she is suffering from a serious pre-existing condition, then Additional Premiums will be imposed on the policyholder.

However, if the policyholder seriously feels that the imposition of the Additional Premium is not justified or for whatever reason or the condition would have changed for the better, then there would be an avenue for the policyholder to appeal for the imposition of the Additional Premiums to be re-looked at.

5.16 pm

The Senior Minister of State for Health (Dr Amy Khor Lean Suan): Mdm Speaker, MediShield Life marks a major milestone towards providing all Singaporeans – the young, the very old and those who are already ill – with protection against large medical bills for life. Universal coverage of this scope is a goal always lauded but challenging to attain, even in advanced economies. That Singapore is taking this huge step shows the Government's commitment to give Singaporeans greater peace of mind for their healthcare needs. Premiums will have to increase with the enhanced coverage. But Singaporeans can also be assured of the Government's commitment to help them with premiums through various subsidies.

I would now like to speak on how the Bill provides for convenient and easy access to MediShield Life Premium Subsidies. I will also elaborate on the Ministry's key communications and outreach efforts during this period leading up to the roll-out of MediShield Life towards the end of the year.

Mr Baey Yam Keng, Mr Zaqy Mohamad and Ms Jessica Tan mentioned the importance of communicating MediShield Life to all Singaporeans. Since this House unanimously supported the MediShield Life Review Committee's recommendations in July last year, the Ministry has stepped up its efforts to share with Singaporeans the benefits of MediShield Life. Through these outreach efforts, we learnt that getting Singaporeans to understand MediShield Life is not simple, because most of us do not think about hospital bills or health insurance until the day we fall ill.

We also learnt that using only the mass media to spread the word is not enough. The communications challenge is quite daunting. We have had to reach out through a mix of platforms, channels and languages, each with different tailored messages. Besides print, radio, TV and social media platforms, we also shared on MediShield Life at the People's Association's (PA) and Agency for Integrated Care's (AIC) grassroots events and dialogue sessions. Thus far, we organised or participated in more than 35 dialogues and community events reaching out to more than 7,000 residents just through the grassroots events. Some of the common concerns raised during these sessions were the affordability of MediShield Life premiums and rising healthcare costs over time, misunderstandings about duplication between MediShield Life and private insurance, the mandatory nature of MediShield Life and duplication of coverage between MediShield Life and pensions benefits or other employer-provided healthcare insurance.

We sought to address some of these concerns and clarify misperceptions through explanations at dialogues by putting up FAQs on our MediShield Life website and through the mass media. And I agree with the Member Mr Alex Yam that our communications and outreach efforts will have to be comprehensive and sustained over time.

Alongside the Ministry's outreach efforts, many advisors and grassroots leaders have been actively engaging their residents. I would like to take the opportunity to thank them for their efforts. We have received good feedback from Members that these efforts have helped their constituents better understand how MediShield Life and health insurance work and how MediShield Life can better protect them when they suffer from serious illness.

While Singaporeans understand that MediShield Life offers better benefits than the current MediShield, some have asked whether they will benefit from MediShield Life if they have already bought a private Integrated Shield Plan. As Minister of State Dr Lam had noted earlier, some even have the mistaken view that they will have to pay for two policies – their Integrated Shield Plans (IPs) and MediShield Life. This is clearly not the case and I think it is a point that bears repeating.

So, let me try to explain it again in this way: MediShield, as it is today, forms the Foundation of all IPs and the IPs, the enhanced portion, ride on this foundation to provide additional coverage targeting the Class B1 or A wards or private hospitals. When MediShield Life is launched, it will become the new foundation. So, MediShield Life, plus the top-up portion, forms one Integrated Plan and a single premium is paid. To use everyday language, MediShield Life is like plain Milo, which is tasty enough for most people. IPs are like Milo Dinosaur or Milo Godzilla, which tastes even richer than Milo but will definitely cost more.

Mdm Speaker, perhaps, I should not be giving high-cholesterol illustrations in talking about healthcare issues but I believe Members get the picture. Let me also clarify that IP policyholders will also be eligible for MediShield Life subsidies if they meet the criteria.

Over the next few months, the Ministry of Health (MOH) will continue with our outreach and engagement efforts to explain and clarify the benefits of MediShield Life. In particular, we will focus our communications and outreach on the steps Singaporeans need to take to make sure the Government is able to give them the right amount of Premium Subsidies that they are eligible for under MediShield Life. Let me elaborate on these.

As Minister Gan said, Premium Subsidies are a permanent, key feature of the MediShield Life Scheme. In their report, the MediShield Life Review Committee (MLRC) also recommended that the process of applying for subsidies should be simple and convenient so that eligible Singaporeans and PRs can access these subsidies easily. We have, however, heard feedback from some Members that their constituents have asked how to start applying for these subsidies. Some were worried that they might miss out on subsidies if they missed the deadline or did not know where to get the application form.

When the MLRC conducted its focus groups last year, we also heard concerns about the process of applying for healthcare subsidy schemes – some elderly Singaporeans commented that it is paiseh, or feel embarrassed, to get their children's signatures for the application because they were busy working!

Mr Gerald Giam had asked if the MediShield Life subsidies will be provided in a convenient and hassle-free manner. I would like to assure Members that MOH intends to extend MediShield Life subsidies to all eligible Singaporeans as conveniently as possible.

How will we do this? Firstly, all Pioneers will receive special Pioneer Generation Subsidies. There is no need to apply. They will get it automatically. Secondly, for Transitional Subsidies which the Government will give all Singaporeans who experience an increase in net premiums, again, there is no need to apply. Everyone who is eligible gets it automatically. So, to use a Hokkien phrase, it is bao jiak, or sure to eat, or to be more exact, bao gia, or sure take, in these two instances.

Thirdly, for the Premium Subsidies for lower- to middle-income households, Singaporeans will also not need to apply. Instead, MOH will tap on existing records in Government databases to determine how much subsidies each Singaporean should receive. We have decided on such an approach of facilitated eligibility checks to ensure that the MediShield Life Premium Subsidies can reach as many eligible Singaporeans as possible.

We are aware that there are Singaporeans who may not know how to apply for the subsidies. So, by doing this facilitated eligibility checks, we ensure that low-income and vulnerable Singaporeans do not miss out on MediShield Life subsidies. We will kickstart the exercise in a few months' time, so that the Premium Subsidies can be computed in time for the roll-out of MediShield Life at the end of the year.

These facilitated eligibility checks will be done back-end using the latest information available to the Government, which include NRIC addresses for us to determine who lives in the same residences, their income and property ownership information. The first key step is to work out "estimated households" by grouping those with the same NRIC address as part of the same household and excluding any tenants that have been declared to HDB. We will then use these "estimated households" and their corresponding income information to calculate the household's eligibility for MediShield Life Premium Subsidies.

However, for some Singaporeans, these "estimated households" may not reflect their actual household composition. This is because existing Government data is only accurate if they have been updated by Singaporeans. For example, we only know the latest address on your NRIC and would not know if you have moved if you do not tell us! To help us know your latest household structure, we will need Singaporeans to do two simple things. So, I shall simply call it "Two-steps to get it right".

Number one, update your address in your NRIC. We urge all citizens and PRs to update your NRIC address. If you have other people living in your household such as tenants in your HDB flats, please update your tenant records with HDB. MOH will need your address information to be up to date as we will use these records to estimate who your household members are.

Number two, check the letter that MOH will be sending to all households in a few months' time. So, please do not throw away any letter from MOH. The letter will provide more information on how to confirm your "estimated" household composition or make changes if necessary.

For most Singaporeans, if their latest address is reflected in Government records including NRIC records, it will be easy to confirm their household composition with a few quick clicks online. For those who are unable to access the Internet, they can also check the information through phone hotlines. Finally, those who need help with the process in person, they can also head to selected community touchpoints, for example Citizen Connect Centres.

To ensure that Singaporeans are aware of what they need to do to get the right Premium Subsidies, MOH will be publishing advertisements – in the print media, television and radio, and in the heartlands – to raise awareness and inform Singaporeans of the simple steps that they need to take. This mass media publicity will be timed to coincide with the letters households will receive. So, please do not rush to the nearest Citizen Connect Centre now.

We also recognise that the human touch is needed to reach out to more Singaporeans. We intend to organise briefing sessions with the People's Association, Grassroots Organisations and conduct roadshows to help spread the message. More details will be made available later.

After the facilitated eligibility checks are completed around the middle of the year, MOH will determine the amount of subsidy that each Singaporean should receive before the launch of MediShield Life.

The Senior Minister of State for Health (Dr Amy Khor Lean Suan): I would also like to address the concerns raised on privacy of income data. In order to determine eligibility for MediShield Life Premium Subsidies, income information is needed to calculate each household's per capita income, similar to what we do for other healthcare subsidy schemes like CHAS. We will only be accessing information already existing in the Government's database and not your bank accounts.

To safeguard and protect income information, the MediShield Life Scheme Bill only allows persons authorised by the Minister to access such information. There are penalties in place against those who access the information without appropriate authorisation or consent. For those who do not wish to have their income information accessed, they can choose not to allow MOH access to the information for the facilitated eligibility checks.

But this will mean that we cannot determine their Premium Subsidies eligibility and they and their household members will not be able to benefit from the MediShield Life Premium Subsidies. Subsequently, if they change their mind and wish to enjoy the Premium Subsidies, they can apply manually anytime for the Premium Subsidies, but would have to submit their financial information in any case.

Finally, I will like to focus on a group of needy Singaporeans, those who cannot afford their remaining premiums even after the various subsidies are applied. Ms Denise Phua, Mr Gerald Giam and Ms Tin Pei Ling had also raised concerns that harsh recovery actions will be taken on those who are needy.

Some members of the public have been very worried after reading newspaper reports that some may be penalised or sued for not paying their premiums. There was even a headline that suggested you will end up in jail for not paying your premiums. I would like to assure Members that there is no jail for not paying your premiums. The jail term only applies if you are served with a travel restriction order, and you defy it and try to flee the country. In addition, we will make every effort to reach out to those who need help. Let me explain how we will do this.

Assoc Prof Fatimah Lateef asked about the touchpoints for Singaporeans who may need Additional Premium Support. We recognise that the group of needy Singaporeans have very diverse needs and profiles, and our messages might not reach them through the traditional mass media channels. For this group, we know from the experience of implementing the PG Package that face-to-face interaction and the human touch, especially communicating in the vernacular, is important.

Hence, there will be comprehensive efforts to reach out to such Singaporeans. For those who have missed premium payments, there will be multiple reminder letters, checks on whether another family member is able to assist them in paying the premiums as well as alerts on the availability of Additional Premium Support if they need it. There will also be direct outreach efforts by the Government. This process will help us determine those who are truly needy from those who can afford it but choose not to pay their premiums.

Mr Hri Kumar had asked about the actions to be taken against defaulters. For those who intentionally evade their premiums even though they have the means – some people say in Hokkien chao kwan, or socially irresponsible – the Minister for Health has explained the need for measures such as penalties on late premiums and recovery of arrears from employers and bank accounts. This is only fair to all those Singaporeans who have paid their premiums responsibly and on time.

Some Members have also asked if one will lose coverage due to non-payment. Let me repeat our promise that no Singaporean will lose their MediShield Life coverage due to the inability to pay nor will they be unfairly penalised for not paying their premiums if they truly cannot afford it.

To conclude, I would like to say that the MediShield Life Scheme Bill provides a sound legal and governance framework for the efficient administration of the MediShield Life Scheme. MOH will continue to reach out over the next few months to communicate the key aspects of this inclusive Scheme to all Singaporeans. With MediShield Life, Singaporeans can have better peace of mind for life. Mr Deputy Speaker, I support the Bill.

5.35 pm

Miss Penny Low (Pasir Ris-Punggol): Sir, I rise in support of the Bill on MediShield Life. As per my previous speech during the debate on MediShield Life, this Scheme is not just about dollars and cents, but it is about our people and it is also about our social ethos. It is only when we put people in the centre of this $4 billion proposal, that the "why" we advocate MediShield Life becomes clear.

The "why" is always because we want every fellow Singaporean and citizen to live with a sense of dignity and self-worth and to inculcate the value of self-help and mutual help along with the virtues of saving for rainy days, or 未雨绸缪. And this is, in fact, what makes Singapore. The MediShield Life is merely the "what" and "how" we do it. Therefore, this speech should be read with reference to my previous speech. For today, I will focus on the mechanism or the "what" of this Bill.

First, however, I recognise that this is a very complex scheme with many considerations, and it is quite a feat to pull it through within such a short timeframe. Once again, I would like to congratulate the team behind it, from the Minister to the Permanent Secretary, the MOH team and the committees behind it – well done! Ultimately, whether it is a good scheme or not depends on a few factors.

First, is the scheme fair? Does it have financial equity? Is it sustainable in the long term?

There are three features of the Scheme that stand out. The first is that it is automatic. Everyone is automatically included – no additional paper will be required. In other words, no Singaporean or permanent resident (PR) is left behind because they are ill-informed, illiterate or poor. By doing so, the increased risk pooling and risk protection, along with adequate social protection mechanisms like financial assistance that target subsidies to the low-income and the disadvantaged will ensure that no one is left behind.

Two, it is universal. Universal coverage should be lauded. I hear Minister of State Dr Lam and Senior Minister of State Dr Khor's explanations about the lien on sub-standard life, but I would like to appeal for more information and greater compassion. Many people with pre-existing illnesses tend to be from an older age group and because they cannot work full-time, many are also from the lower-income group living in smaller or rental flats. The 30% lien for 10 years can be a burden for them. In the spirit of mutual help, may I ask the Ministry how much would this cost per insured, if spread amongst the entire risk pool, or if absorbed by the Government? I think we can be more compassionate in this instance.

The third feature is that there are lower out-of-pocket expenses. Sudden bad health gives no notice. Hence, the shift in financing from post-payment to pre-funding and pre-payment will ensure that people do not need to worry about treatment and financing simultaneously, which can be disastrous. Many of our hardy Pioneers and elderly hid their bodily pains and health conditions from their children and refused treatment because they do not want to burden their family. This is not right. Our elderly have contributed to Singapore and deserve the best care in their old age. We need to take care of them. With MediShield Life and pre-payment, financial barriers are reduced. They will receive proper treatment while the ethos of saving for a rainy day is also being reinforced.

But there still remains quite a number of questions on people's minds, in particular, the long-term sustainability of the scheme. How do we cope with the rapid technological advancement that escalates costs of detection and early treatment? What happens when someone defaults on the payment? I hear some of the assurances given by the Minister of State but what are the definitive criteria and system in place to ensure that premiums are collected, and we weed out the irresponsible and free riders? How do we ensure, at the same time, that the needy are objectively and adequately taken care of? And, in addition, how much premiums will we have to pay over a lifetime? Is the amount in Medisave sufficient to cover these premiums? Is there a "minimum sum" we need to set aside by retirement age to ensure that we have enough to cover premiums during our retirement? Otherwise, is there a risk that we may use up our Medisave on deductibles or outpatient or Integrated Shield Plans and so on, thereby leaving insufficient funds for MediShield premiums in retirement or even before retirement?

I think more information on the overall costs and financing should be made available so that the man on the street understands the impact of health financing in their lifetime and the need to save more for the long term. Perhaps, MOH can help to improve financial literacy on health costs, help people to understand what is covered, what they need to be responsible for and what options they have to supplement their coverage and how the healthcare system is funded, for example, how many percentage is funded from taxes, from MediShield, from Medisave, so that there is transparency and sufficient knowledge to help people to budget and plan.

Mr Deputy Speaker, Sir, while self-help is pivotal, intra-family help should also be encouraged and facilitated. Cash top-ups and contributions to siblings, parents, grandparents and children's Medisave account should be made tax-deductible and this should be allowed for multiple account contributors simultaneously, and obviously also up to a certain ceiling. This would be in line with IRAS' recent amendment of the Parental Relief policy. By doing so, it not only ensures that those doing better can help those who are doing less well, it also strengthens the concept of a family being the basic unit of society and build a strong sense of collective responsibility and social capital.

If successfully implemented, MediShield Life will anchor itself on a pre-funding and pre-payment scheme, with increased risk pooling and risk protection. This would mean for those who desire more comprehensive protection, various riders could be offered as an option. Here, I repeat my call to do a lot more to encourage all employers to cover their staff through MediShield Life.

A second big area in evaluating a scheme is whether the scheme is efficient, effective and responsive in serving the people. I think any system, no matter how well-designed, will falter unless it is well communicated. Despite the advertisements and Government announcements, many are still unclear about what MediShield Life covers and some even question if they would ever use it. There is an urgent need for effective public communication to explain the nature and benefits of MediShield Life. I hear Senior Minister of State Dr Khor's assurance about roadshows and the various publicity plans that are in place.

I am heartened by that, but at the same time, I am going to suggest that perhaps, we could also try crowdsourcing video clips made by those who are concerned with it and those who have video or storytelling abilities, so that on one hand, they learn about it with their team and on the other hand, they are able to produce short watchable clips that will educate the public. And perhaps also set up interactive websites that feature case studies and financial calculators as well as brochures and leaflets that can be made available at public places like shopping centres, hawker centres, community clubs, clinics and hospitals. The truth is that for many people, they do not quite care about the details of insurance policies until disaster strikes. Hence, making these resources available permanently will help to alleviate any misconception of the scheme on an ongoing basis.

Above all, the messages should be clear. To the older Singaporeans, they should have the assurance that they will be taken care of in their old age, although they should be encouraged to continue to live a healthy lifestyle. To the younger generation, there is personal and collective responsibility in keeping future premiums low; that means maintain healthy lifestyle, do not abuse the healthcare system and still there is a need to put aside more for common illnesses, deductibles and co-insurance.

The third criterion is whether the Scheme improves the health status of the population, or simply put what is the final health outcome? Ultimately, the litmus test will be how and whether it improves the outcome of the population's health and our health system, how it aligns with the objectives of our overall national health system and how it keeps costs down.

MediShield Life cannot be a stand-alone scheme. Hence, together with other health reforms, questions like how it will change consumer health consumption behaviour should be asked. For example, how will the subsidies and coverage influence people's utilisation of health services? Will it reinforce inappropriate patterns of healthcare? For example, will it favour provision of high-tech, doctor-centred, hospital-oriented care and undermine the provision of preventive care?

Corollary, how will it incentivise the productivity and behaviour of providers? Third-party reimbursement systems may suffer the moral hazards of excessive or inappropriate consumption and high administrative costs.

Therefore, upstream design thinking should be translated into operational budgets, financial plans, monitor and evaluation systems. Extensive links with major stakeholders – employers, providers, government, support groups, non-governmental organisations (NGOs) and so on, should also be roped in to ensure that the final health outcome is an improved one.

Efforts should also be put into developing feasible networks to share health financing evidence, best practices, information, knowledge and comparative experiences. Of course, in the market, I think there are some valid concerns about data privacy – who gets to access them, how will it be used and how will it be properly protected. Apart from hefty fines, it will also be important for the Government to highlight the safeguards in place to prevent any abuse or hacking activity.

Downstream, collective responsibility is key. Unless we expect the Government to tighten claim restrictions when the time comes, we all have a part to play and we are in it together. Healthcare should be people-centric.

First, professional responsibility. Health professionals should be incentivised to return to high touch, not just high tech. Transactional relationships exert a toll on the healthcare system as patients suffer anxiety or uncertainties which could have been answered with just a few more minutes of question-and-answer (Q&A). Redesign the healthcare professionals' rewards system so that the "care" is put back in "healthcare".

I do not know if Shaman has real divine powers, but it is clear that by putting the patient in the centre and giving time to the treatment exerts a positive psychological or placebo effect that sometimes result in unexplained cure. The point is, spending more time with a patient helps, especially after hours and months of waiting for medical consultation.

Second, personal responsibility. Our health is ours and so is the cost. Besides consuming healthcare responsibly, we should also take care of our own personal health – something which only we ourselves can do for ourselves. This involves mindset and behavioural changes – starting from our diet to lifestyle habits. More greens, less processed foods and less binging, healthy doses of regular exercises can help keep the doctor away.

If it is hard to exercise alone at home, join exercise groups with certified instructors at every heartland. In my constituency, Punggol North, there are at least 20 of such groups embracing various forms of morning exercises every day and these are complimented by all different types of exercises in the evenings and on weekends.

Recently, I led a parliamentary delegation to Ecuador. I was very impressed to see that in Quito, the capital city, every Sunday, popular streets are closed and extensive areas are designated to encourage residents to jog, cycle and work out. And they do it en masse naturally. There was no particular campaign whatsoever at activity centres. It is just that everyone is encouraged to come out and exercise and keep healthy. It is quite a scene. I think it is something that we can learn from and adapt it to our own environment. Apart from giving the body a workout, such community groups offer the friendship, the sense of belonging and mutual emotional support that are critical to our psychological health. Often, it makes a big difference when a person has a sense of hope and knows that he or she is not facing the illness or a physical condition alone.

Therefore, I advocate the setting up of a health endowment fund, something which I mentioned in the last speech, and more aggressive programmes alongside MediShield Life reforms to encourage healthy living habits, build physical and psychological health and redesign our environment, or take advantage of our connected parkways, to focus on prevention rather than cure. Nobody wants to pay extra premiums to cover the irresponsible guy who does not bother about his health, so we need to get everyone in on this movement.

Reward the role models who could be our ordinary men and women in the heartlands, who live healthy and advocate it to their family members and neighbours. We should incentivise peer-to-peer influence and facilitate community platforms – which is critical for cultivating healthy habits and passing on factual health tips and, in doing so, also help us build up a social capital that in turn gives people a stronger sense of security and positively impact on their health.

These considerations should be part of the MediShield Life design so that it is holistic, it incentivises the desired behaviour and it improves the overall health outcome of our nation.

Mr Deputy Speaker, Sir, I am assured that our healthcare future is in good hands – so long as we all understand our collective responsibility to look out for each other, so long as we take personal responsibility in prevention and cure and so long as we continue to elect a capable and responsible Government – who has a compassionate heart with a level-headed and informed view of Singaporeans' longer-term needs. Sir, I support the Bill.

5.51 pm

Mr Ang Wei Neng (Jurong): Mr Deputy Speaker, Sir, MediShield Life is a game-changer. It will change the way how Singaporeans will benefit from our healthcare system. It may also change the way how medical professionals care for and charge patients.

For the first change, it is good news for many Singaporeans. I totally agree with Senior Minister of State Amy Khor that we need to communicate the benefits of MediShield Life to all Singaporeans. More so than the Pioneer Generation (PG) Package. One of my residents received his PG card from me personally soon after National Day last year. The PG card was wrapped in a very nice hamper, along with other PG gifts prepared and donated by my grassroots leaders. Before giving out the PG hamper, we also explained the benefits of the PG package in different languages to the audience.

However, this Pioneer did not open the PG hamper for months. Not just because the hamper was so nicely wrapped but more importantly due to his recent experience with the hospital. About a year ago, this Pioneer fainted on the road and was sent to a public hospital by an ambulance. He had to stay one night at the hospital for observation. When he was discharged from the hospital, his children had to pay a hefty medical bill on his behalf and he was frowned upon by his own children. Since then, he refused to seek any medical treatment for fear of incurring medical costs. It was not until our PG ambassador explained the PG package to him again on a one-to-one basis late last year did he have the courage to open the nicely wrapped PG gift hamper and use the PG card.

Similarly, many Singaporeans lament that they "can afford to die" but "cannot afford to fall sick". We have confidence that the MediShield Life will go a long way to change the narrative, but of course we have to communicate the benefits to all Singaporeans through various channels. This Sunday, for example, I will support Dr Amy Khor to have a dialogue with Jurong residents on MediShield Life in Mandarin. I hope that such efforts will continue and have to be sustainable.

As for how the medical professionals will change the way they treat the patients because of the universal insurance coverage that may cause cost escalation, I will not venture to offer any solution but leave it to fellow parliamentary colleagues who are doctors and the Ministry of Health (MOH) to work on it together.

Dr Amy Khor has earlier on touched on the issue of the definition of the number in households or address. I would like to seek a clarification. When a young couple has a newborn baby and decide to move back to their parents' flat, and assuming they also changed their address, will the newborn baby and the young couple be considered as part of their parents' household to compute the number of people in the household to qualify for the insurance premiums?

Next, I want to touch on Persons with Disability (PWDs). If the PWD is less than 21 years old, his parents are obliged to pay for his MediShield Life premiums as mentioned in clause 4 subsection 1c(ii). When the same PWD turns 21 and cannot work or accumulate enough savings in his CPF account, would his parents still be obliged to pay for his MediShield Life premiums? Would the Government consider paying the premiums of PWDs using the Additional Premium Support?

My second clarification is with regard to clause 15. Clause 15 of the Bill allows a recovery body to sue a person to recover his outstanding premiums. May I clarify with the Minister whether the Government will pay for the cost of the suit? Or will the Government use the MediShield Life fund to pay for the legal cost even though the person being sued eventually cannot afford to pay his outstanding premiums?

My suggestion is of course not to be heavy-handed when dealing with Singaporeans who cannot afford to pay the premiums, as mentioned in my speech on 8 July last year. And many hon Members have also alluded to this.

I note that clause 4 sub-section (2) allows for the CPF Board to deduct the MediShield Life premiums from a person's Medisave account. If his Medisave account does not have sufficient funds, the recovery body is entitled to recover the outstanding premium from the person's salary, bank account and so on. I would suggest that the Minister could consider recovering the outstanding premiums from the person's other accounts in his CPF such as the Ordinary Account, Special Account, Retirement Account or Special Retirement Account and so on, before appointing a defaulter's agent to recover the outstanding premium by other means. In this way, no Singaporean can claim that he has money in his CPF but cannot use it to pay the MediShield Life premiums and end up being sued by the Government. With this, I support the Bill.

5.57 pm

Mr Gan Thiam Poh (Pasir Ris-Punggol): Mr Deputy Speaker, I rise in support of the Bill. I am very happy with the implementation of a national insurance Scheme which will ensure that all Singaporeans are covered from birth to death. My residents feel the same. They feel particularly reassured by the coverage of pre-existing conditions and the removal of the lifetime claim limit. The increase of the annual claim limit from $70,000 to $100,000 is also welcomed as most bills will fall below this amount.

With compulsory universal coverage, payment defaults can have a serious impact on the sustainability of this Scheme. Hence, the Bill gives the Government wide-ranging powers to access personal information. These include the power to check a person's income with the Inland Revenue Authority of Singapore (IRAS) and his health status via hospital records without needing to get his permission.

However, there is a clause allowing those who find these checks too intrusive to deny access. Without the information, it is not possible for the Government to determine if they are eligible for income-determined Premium Subsidies or the standard premiums for those without pre-existing diseases. Therefore, such individuals will have to forfeit any potential Premium Subsidies and be levied the 30% additional premiums for 10 years, same as for those with pre-existing diseases.

I would like to seek clarification regarding information access. Will the Ministry be accessing one's credit record with the Credit Bureau and foreign bank accounts where information is protected under the Banking Secrecy Act? Despite all these checks, there is still a limitation to the access of full information of a person's assets beyond Singapore's jurisdiction.

Another potential problem is that while a person could be asset-rich, whether the assets are local or overseas, the assets may not be liquid. As a result, this person might be unduly penalised by his personal circumstances.

The MediShield Life Scheme also gives the Minister the same powers as the taxman for recovering unpaid premiums – such as deducting from salaries or from bank accounts. These measures are needed as they deal with those who can pay the premiums but fail to do so or refuse to do so, thus, increasing the load on other policyholders in order to ensure that it is fair and equitable to everyone under the Scheme.

Does it mean that any accrued premiums will get top-priority ranking during debt recovery compared to other creditors? Will the same powers enable the Minister to lodge a caveat or put a lien on personal realisable assets such as a HDB flat or private property for the recovery of unpaid premiums? Does this also mean that a defaulting policyholder will not get his professional licences renewed as is currently the case with Medisave? Will a policyholder be automatically included in the casinos' exclusion list? What will happen to those who are unable to work for medical reasons and those who are bankrupt? How will the Ministry assess these cases, especially for the ones heavily in debt? Most importantly, will their coverage remain intact in the interim?

Perhaps the Ministry can consider allowing a policyholder to pledge his or her immovable property, including HDB flats, for the payment of the premiums without needing cash top-ups. Will the Ministry consider granting non-claim bonus, like what is being done in the motor industry for the insured, if the person made an effort to stay healthy and has never claimed under the Scheme?

For this new Scheme, the coverage amount will be higher, co-payment will be lower and there will be no cap on the sum that a person can claim in his lifetime. As a result, premiums will be higher than those of the current MediShield scheme. I am glad to know that the Government has pledged $4 billion in aid over five years to ensure the new scheme stays affordable. Also, two in three people will get permanent subsidies of 15% to 50% on their premiums. Increasing employers' Medisave contributions by 1% and allowing contributions from spouses and siblings are also helpful. Those who still cannot afford the premiums will get additional help from the Government. For most people, the higher premiums can be covered fully by Medisave.

I also support the establishment of the MediShield Life Council to review the scheme periodically and recommend changes to ensure it continues to give effective protection to all citizens. Will the Ministry consider setting up another appeal panel to review all appeals including reviewing all medical claims by the medical practitioners to ensure that treatment is both appropriate and most cost effective? I hope the administrator of this Scheme must be compassionate – all cases of defaults are to be reviewed with the benefit of doubt given to the members or the policyholders and understanding. Penalty must always be the last resort for the affected. Let me continue in Mandarin.

( In Mandarin ) : [Please refer to Vernacular Speech.] Mr Deputy Speaker, looking after the people is the duty and responsibility of the Government, just like it is the duty and responsibility of the parents to look after the family. The Government cannot do nothing when someone is dying just as the doctor would do his best to save the patient's life so that the patient can recover quickly.

Singaporeans must also look after their own health and live a healthy lifestyle. When you fall sick, you are the one who will suffer; nobody can substitute your body and you will suffer the pain of any illness.

Because MediShield Life is for everybody, every one of us has the responsibility to ensure its sustainability. All Singaporeans must look after their own health and stay healthy. This will help reduce the amount and number of claims so that the premiums will remain affordable to the people in general.

The success of this Scheme will depend on everybody's support and sharing the cost together. For those who are financially hard-pressed, we have to make sure they receive assistance and support. We have to ensure that no one will be left without cover because of financial problems. We occasionally would hear people say "I do not even have enough money to eat, let alone buy insurance!" How will the Ministry further simplify the assistance model to help the needy Singaporeans? I think the Ministry can work through the Community Centres to help these people.

We can also encourage Singaporeans to be charitable and donate money to help those who cannot afford to pay their premiums. We have to build together a society which is full of compassion and care. Perhaps the Government can provide tax benefits and relief to encourage Singaporeans to help the disadvantaged pay their premiums. I support the Bill.

Mr Deputy Speaker: Minister Gan.

6.06 pm

The Minister for Health (Mr Gan Kim Yong): Mr Deputy Speaker, I thank the Members for their support for the MediShield Life Scheme and the Bill, and for their comments. I have also learnt something new at this Sitting – it is very dangerous to nod your head in the Parliament. I am, indeed, heartened by the strong interest in the Scheme as this is a very important universal mandatory Scheme that applies to all Singaporeans. For this reason, my round-up speech is likely to be longer than my Second Reading speech.

Members have reflected their concerns and sought clarifications on how this will affect various groups of Singaporeans, especially those who are more vulnerable. Their concerns have echoed the feedback we received from the members of the public over the past months and I thank Singaporeans for their contributions.

The MediShield Life Review Committee worked hard and listened hard to Singaporeans and came up with a comprehensive package of well thought-through recommendations, which garnered unanimous support from the Members last year. This MediShield Life Scheme Bill will allow us to carry through the Committee's recommendations.

I will address the Members' questions and requests as well as explain the thinking behind some of the provisions of the Bill and provide a better understanding of the Scheme.

Sir, I will address the issues that have been raised in the following three broad themes: (a) Towards a more inclusive society through MediShield Life; (b) Towards a More Caring and Progressive Society, meaning those who are needy will receive help and those who are able should do their part; and (c) Ensuring sustainability in our healthcare system.

First, on the inclusiveness of MediShield Life. I thank the Members' support for the Bill, and the support for universal coverage to ensure that no Singaporean is left behind to shoulder any unexpectedly high medical bills on his own. There are pockets of Singaporeans who may not fully appreciate the benefits of a universal scheme. Therefore, Ms Ellen Lee is right that there is a need to help Singaporeans understand what it means to have a universal Scheme and the spirit behind it and I seek Members' help to continue our outreach efforts and share about MediShield Life with grassroots leaders, community leaders and Singaporeans.

Ms Jessica Tan, Dr Lily Neo and Mr Alex Yam asked about whether some Singaporeans can be excluded from the MediShield Life Scheme, such as those who are residing overseas. Sir, all Singapore Citizens and permanent residents (PRs) are required to participate in the national risk pool even if they are overseas. They can also benefit from MediShield Life coverage any time they return to Singapore and seek medical treatment here, regardless of any changes in their health or life circumstances.

Companies offering portable medical benefits generally build on top of the MediShield Life layer and there is minimal duplication. For example, some may make additional contributions to employees' Medisave while some may purchase Integrated Shield Plans (IPs) for them. Assoc Prof Fatimah Lateef asked about how Singaporeans with portable medical benefits from their companies can also benefit from MediShield Life Scheme. It is for this reason that the Government encourages companies to move towards portable medical benefits and they are supported by incentives to do so. Employers who do not offer portable medical benefits can review the coverage and structure of their employer medical benefits to tap on and even build on top of MediShield Life or IPs.

MediShield Life will continue to cover them for life even when they leave the employment or retire. They need not worry about developing medical conditions that cannot be covered even if they are no longer employed.

In response to Mr Png Eng Huat's query on how pensioners can benefit from this Scheme, MediShield Life will provide additional benefits above and beyond that provided for under the pensioners' existing medical benefits. It will, however, not take away anything that they are already enjoying today. Therefore, I hope Mr Png is now clear about the benefits that the MediShield Life will provide.

The provisions of this Bill also reflect the overall philosophy of the MediShield Life Scheme in moving towards a more caring and inclusive society. Members in the House have shared concerns about the premium affordability, which were also brought up during the MediShield Life review. As I outlined in my Second Reading speech earlier, the Government has committed a large slate of measures and subsidies to help Singaporeans afford their premiums. Let me briefly recap these subsidies and address queries that the Members have raised.

First, there will be Premium Subsidies for the lower- to middle-income Singaporeans of up to $2,600 household monthly income per person. Premium Subsidies are a permanent feature of the Scheme, which means that Singaporeans will receive them for as long as they meet the criteria.

Second, there will be Pioneer Generation (PG) subsidies for all Pioneers. Ms Tin Pei Ling and Mr Baey Yam Keng expressed their concerns about Pioneers who may face difficulties with higher premiums over time. Sir, allow me to recap the rationale and assurance of the Pioneer Generation (PG) Package. The intention of the PG Package is to provide Pioneers with greater assurance so that they do not have to worry about their healthcare costs, including MediShield Life premiums, in their old age. The PG Subsidies for MediShield Life premiums are not based on means and apply equally to all Pioneers. To help with premium affordability, the subsidies increase with age, rising from 40% at age 65 to 60% at age 90. Together with the annual Medisave top-ups for Pioneers, premiums are highly affordable.

To Mrs Lina Chiam's suggestion, I would like to highlight that with the PG Subsidies and Medisave top-ups, Pioneers aged 80 and above will have their premiums fully covered. The Government also provides annual Medisave top-up to all eligible elderly Singapore Citizens aged 65 and above under the GST Voucher to support their medical needs. Younger Pioneers can tap on this to further offset MediShield Life premiums if needed. No one, especially our Pioneers, will lose their MediShield Life coverage due to the inability to pay for their premiums.

Third, there will be Additional Premium Support for Singaporeans, including Pioneers, who need further help with their premiums even after Premium Subsidies. We would like to assure Members like Ms Tin Pei Ling and Assoc Prof Fatimah Lateef that the Government will proactively reach out to Singaporeans, including Pioneers, who have insufficient Medisave balances and insufficient family support and assess if they need Additional Premium Support. In line with the principles of family support, eligibility criteria for Additional Premium Support will take reference from the principles of MediFund, to assist the needy with limited self and family support.

Mr Karthikeyan expressed concerns about individuals who are temporarily facing financial distress. I would like to assure Members that flexibility will be exercised for individuals who need help because of their unique or sudden unfortunate circumstances. Dr Amy Khor mentioned in her speech how we will work with relevant agencies and organisations to reach out to the genuinely needy to provide them with timely help. We will do what we can to ensure that those who need the help will get it.

In response to Ms Jessica Tan's query on what measures will be in place to help PRs who are facing financial difficulties and are unable to afford premiums, I would like to clarify that eligible PRs can also receive Premium Subsidies at half the subsidy rates for citizens.

Fourth, there will be Transitional Subsidies to help Singapore Citizens ease the transition from MediShield to MediShield Life in the initial four years. We announced last year that the Transitional Subsidies will offset the increase in payable premiums in the first four years of the Scheme, that is, after taking into account Premium Subsidies with subsidy rates of 80% in the first year, 60% in the second year, 40% in the third year and 20% in the fourth year. In the fifth year of MediShield Life, after Transitional Subsidies have been phased out, lower- to middle-income households will still continue to benefit from Premium Subsidies.

Dr Chia Shi-Lu has expressed concerns about transition and asked if we can provide greater help. This shift to MediShield Life is an important step and I am pleased to announce that, to further ease the transition, the Government will increase the Transitional Subsidies it will provide to Singapore Citizens for the first two years of the Scheme. In the first year, all citizens who face an increase in their net premiums will be subsidised 90% of the net increase in premiums, followed by 70% in the second year. This is higher than the earlier announced rate of 80% and 60% for the first and second year respectively. The Transitional Subsidy rate for the third and fourth years of the Scheme will remain at 40% and 20% respectively. What this means is that Singapore Citizens moving from MediShield to MediShield Life will pay only 10% of the net premium increase in the first year, or less than $3 per month, while enjoying significantly enhanced benefits under MediShield Life.

Many Members have asked questions about the facilitated eligibility checks and the safeguards in place to protect individuals' information.

Sir, allow me to briefly reiterate that MOH intends to extend MediShield Life subsidies to all eligible Singaporeans as conveniently as possible, especially subsidies for lower- to middle-income Singaporeans. The MediShield Life Scheme Bill provides the framework for this approach and enables us to provide subsidies to those who are vulnerable and may find it difficult to apply for subsidies themselves.

Dr Janil asked when individuals can opt in for the facilitated eligibility checks. They can apply any time and will take effect from the next policy renewal date.

Assoc Prof Fatimah Lateef, Mr Gerald Giam and Ms Jessica Tan voiced their concerns about safeguards in place to protect individuals' information. As shared earlier, stringent safeguards are in place to protect the information from unintended or inappropriate use.

First, only authorised persons will be allowed to access, use or disclose medical and financial information for the specified purposes. These purposes are set out clearly in clauses 26 to 28. They will be required to sign appropriate undertakings. Second, the Minister in charge of the agency that controls the information requested will have to approve the disclosure of that information and can impose appropriate terms and conditions.

Here, I wish to clarify with Mr Gerald Giam on his query on clause 30. Clause 30, in fact, relates to the power of the Minister concerned to impose appropriate terms and conditions in order to safeguard the information, such as stipulating access controls. It is not, as Mr Gerald Giam supposed, to give the Minister broad powers to approve access and disclosure of information. This is for the Minister who is in charge of the information, in addition to the Minister for Health who is in charge of MediShield Life. So, for example, if MOH requires the information from another Ministry, the Minister in charge of that Ministry has to approve before I can have access to the information.

Sir, in response to Mr Giam's query on cybersecurity standards, MOH and the CPF Board will continue to adhere to the Government's cyber security standards, and these standards include a range of internal processes and technical safeguards.

Third, clause 29 of the Bill makes it an offence for any person to access, use or disclose information about an individual obtained under Part 5 of the Bill without authorisation or the written consent of the individual concerned. Offenders may be punished with a fine of up to $5,000 or imprisonment of up to 12 months, or both. In response to Mr Alex Yam's query on the sufficiency of this punishment, this is in line with similar offences under the Pioneer Generation Fund Act.

In response to Mr Gan Thiam Poh's query on whether authorised persons will be allowed to check individual's credit records with banks, we would like to assure the Member that the eligibility checks for MediShield Life Premium Subsidies will only extend to existing income records within the Government databases. These will not be extended to private or commercial records, including any bank or credit card records.

Ms Chia Yong Yong asked about the handling of information by appointed insurers and the differences between section 59 of the CPF Act and clause 37(8) of the Bill. Under section 59 of the CPF Act, information is shared with insurers today to enable them to administer Integrated Shield Plans (IPs) for their policyholders and enable the use of Medisave for these plans. Clause 37(8) enables this sharing of information to continue. In addition, clause 37(8) tightens the scope of disclosure compared to section 59 of the CPF Act, where the Minister's approval is needed before information can be passed to insurers. All insurers remain bound to handle information securely on behalf of their policyholders under the Personal Data Protection Act, as should be the case for all information that they handle for all policyholders.

The Member also asked about the retention of section 56A in the CPF Act. The CPF Board previously administered plans that provided higher coverage than the basic MediShield. These plans were transferred to NTUC Income after a competitive tender in 2005. Section 56A needs to be retained to support this transfer, as well as to preserve continuing obligations on NTUC Income with regard to the transfer and certain subsections under section 56A that have continuing application.

While Members generally support having appropriate penalty and premiums recovery measures in place to ensure social responsibility in premiums payment, several have voiced their concerns on whether sufficient efforts will be done to help Singaporeans pay premiums, so that the measures will not be unfairly imposed on those who intend to pay but either cannot afford to or simply forget to do so. I would like to assure Members that we will make premiums payment as convenient for all Singaporeans as possible by putting in place a comprehensive framework of measures. This is also to ensure that penalty and premiums recovery measures are only targeted at those who have the means but wilfully refuse to respond to payments for extended periods of time.

The premiums payment framework will involve the following measures.

First, we will facilitate payment of premiums by other immediate family members, such as parents and spouses, so that they can use their Medisave to pay for their loved one's premiums. Mr Hri Kumar has asked about the reference to premiums payable by "other persons" in clause 4(2)(b) of the Bill, and if an individual can object to the deduction of another person's premiums from his Medisave account. We would like to clarify that, today, Medisave may be used to pay for health insurance premiums for yourself and your immediate family members such as your spouse, children and parents. Clause 4(2)(b) supports this process. When we facilitate the payment of premiums by any of these family members through Medisave, the family member will be notified before his Medisave monies are deducted, and he may elect to cancel this arrangement if he wishes to do so.

In the case of children below age 21, parents are liable for the premiums of their children. They will be required to pay for their children's outstanding premiums, through deductions from their Medisave accounts, or other means.

Assoc Prof Fatimah Lateef asked about the definition of "parent" in clauses 4(3) and 5(5) of the Bill in the context of a single lady who is not legally married but has decided to have a child of her own. I wish to clarify that in the situation described by Assoc Prof Fatimah Lateef, the single lady will be responsible for the child's premiums as the parent of the child. I would like to add that citizen babies born on or after 26 Aug 2012 will receive a $3,000 Medisave grant under the Marriage and Parenthood Package, which can be used to help pay for their premiums.

Mr Baey Yam Keng was concerned that this Medisave grant would not be sufficient to cover the premiums incurred by a young adult in his initial years when he may not yet have the financial means to pay. I would like to assure the Member that immediate family members, including parents of the young adult, are allowed to help pay for his premiums if he runs out of Medisave balances. If the family is in trouble facing financial difficulties, Additional Premium Support will apply.

Second, for those who have missed premiums payments due to insufficient Medisave balances or family support, notices and reminders will be sent to give them sufficient time to respond or make arrangements to pay.

Third, for those who need further help with their premiums even after Premium Subsidies and Transitional Subsidies, the Additional Premium Support is available to help them.

Assoc Prof Fatimah Lateef and Ms Chia Yong Yong were concerned that adults who are mentally incapacitated may face difficulty paying premiums and even more so if they come from low-income families. Sir, while adults are liable for their premiums, for those who are unable to pay, we will encourage and facilitate family support and for their immediate family members to pay for their premiums. For low-income needy families who are unable to afford premiums even after all the Premium Subsidies, we will make Additional Premium Support available to them.

While the Government will do our best to help the needy, including the elderly referred to by Er Dr Lee Bee Wah, afford their premiums, all Singaporeans should play their part to ensure that their Medisave accounts have sufficient balances for premiums payment and respond to notices for alternative payment arrangements and Additional Premium Support. If an individual repeatedly fails to pay premiums or respond despite multiple notices and reminders, we would have to impose penalty for late payment to be fair to the rest of the Singaporeans who pay their premiums on time.

Let me emphasise that the premiums recovery framework and penalty are directed at a small group of freeloaders who are wilful defaulters and do not contribute their share, even though they can afford to. They will continue to be covered under MediShield Life and their debts will be unfairly shouldered by those who have paid their share responsibly. Appropriate premium recovery measures and penalty will have to be in place to deter freeloaders. In response to Mrs Lina Chiam's concerns about the recovery bodies that would be engaged to collect outstanding premiums, I would like to clarify that we will be appointing the IRAS and the CPF Board as recovery bodies, as I mentioned earlier. There will be no involvement of "loan sharks".

Assoc Prof Fatimah Lateef and Mr Hri Kumar reminded us about the need to be mindful of the cost and effectiveness of various recovery measures when recovering premiums from wilful defaulters. We would like to assure Members that the various premiums recovery measures will not be imposed mechanically but will be done with discretion and flexibility. We will seek direction on this from the MediShield Life Council when it is formed.

Er Dr Lee Bee Wah was concerned that recovering outstanding premiums from joint monies might not be fair to the other party who jointly owns the monies. Clauses 13(4) and 13(7) allow an owner of the joint monies to surface their objections regarding the amount to be deducted from the joint monies.

Mr Ang Wei Neng suggested recovering premiums not just from Medisave Account, but also from the Ordinary and Special Accounts. Monies in the CPF Ordinary and Special Accounts are set aside to help with other daily living needs in retirement and we will not tap the protected monies in these accounts. I am sure the Minister for Manpower will also not agree. However, we wish to clarify that the premiums can be deducted from any CPF monies that are withdrawn as cash.

Several Members have shared their concern on the potential for the overconsumption of medical treatment under MediShield Life and the sustainability of MediShield Life and Government subsidies. These are important concerns and I thank the Members for raising them. To manage overconsumption and over-provision of treatment, MediShield Life retains deductible and co-payment components to safeguard against the "buffet syndrome". We will continue to carefully monitor claims.

Ensuring the provision of cost-effective and sustainable care is a larger journey that involves more than MediShield Life. We can do more with everyone's help. All of us – patients, healthcare providers, insurers, family members – need to do our part. For example, healthcare providers should provide care that is appropriate and not over-prescribe tests or medication and help to guide patients in making wise and cost-effective treatment choices. More expensive does not mean better, as highlighted by Dr Lim Wee Kiak. The CPF Board and private insurers need to continue to carefully monitor claims for inappropriate or excessive treatment. Most importantly, all of us can encourage each other to make healthy choices, such as eating healthily, wisely and exercising regularly.

Dr Lily Neo has suggested building some incentives akin to the No-Claim Bonus into MediShield Life Scheme to encourage Singaporeans to stay healthy. This was also raised by those who participated in the MediShield Life review. The MediShield Life Review Committee weighed the pros and cons and decided that there are better ways to promote healthy lifestyles. They were concerned that with incentives like the No-Claim Bonus, patients might delay treatment to maintain their No-Claim Bonus, which could result in serious consequences. Moreover, the need for medical treatment may not always be avoided even when good care is taken, such as when accidents occur or for congenital conditions. Introducing incentives in the Scheme may unduly penalise these patients even when it is no fault of theirs.

The Ministry will also play its part. We encourage patients and doctors to bear in mind cost-effectiveness even as they seek out newer treatments. We work with clinicians to develop clinical protocols and guidelines. This is to encourage cost-effective treatment of patients and choice of drugs. Hospitals are required by law to provide financial counselling at the point of admission to help patients make informed decisions.

Many have also spoken about the sustainability of the Scheme and of the subsidies. It is important that the MediShield Life Fund is sustainable and therefore it must strike a careful balance between benefits and premium affordability.

The Government has, in fact, committed to support the Premium Subsidies for the lower- and middle-income. We will continue to be prudent in managing our resources to ensure that the Government is able to sustain these subsidies.

Members have also asked about the benefits of the Scheme, such as whether claims can be paid for self-inflicted injuries or whether benefits can be extended to new areas. MediShield Life does not cover self-inflicted injuries so as not to encourage such behaviour. But if the injuries arose from mental illness, as mentioned by Ms Chia, we will review their coverage on a case-by-case basis.

Some asked about the need for Integrated Shield Plans (IPs). The Minister of State has suggested three key factors to consider. I would encourage Singaporeans to consider carefully whether you really need the IP and whether you are prepared to pay the higher premiums, not just when you are young but also when you are old. Miss Penny Low has also cautioned against overspending on IPs, and as a result, depleting Medisave. With the substantial enhancements, MediShield Life will be adequate for the vast majority of Singaporeans. Therefore, consider very carefully when you think about IPs.

Dr Lim Wee Kiak suggested that the MediShield Life Scheme also covers palliative care, medication, outpatient mental treatment and preventive dental and eye screenings. The Member is among many who hope for MediShield Life to include additional benefits. We have already taken a significant step from MediShield with the benefits proposed by the MediShield Life Review Committee last year. We will continue to review how we can improve MediShield Life in the future but there is a need to balance premium affordability and benefit coverage. In the meantime, there are also other forms of subsidies, such as those under the Community Health Assist Scheme (CHAS), which can help Singaporeans with other healthcare expenses.

Sir, let me conclude. Many Singaporeans who took part in Our Singapore Conversation and the focus group discussions hosted by the MediShield Life Review Committee supported having a universal national healthcare insurance scheme, not just for the benefits and assurance that it brings to those who are covered but also for the ideal behind such a national Scheme – that all Singaporeans will come together as a nation to build this healthcare safety net so that no one is left behind.

The debate on this Bill has largely focused on the how and the what of the MediShield Life Scheme – how do we carry through the recommendations of the MediShield Life Review Committee and what each of us have to do for the Scheme to work well. It is also important for us to revisit the why – why did we embark on this national health insurance Scheme in the first place.

MediShield Life Scheme is the embodiment of Singaporeans' aspiration for a more inclusive, caring and progressive society. It is this aspiration that guided the development of this Scheme, how we make it easier to extend help to the vulnerable and the needy, why we include those with pre-existing conditions, how we ensure those who are able will pay their premiums and the reason for wrapping up the debate in these themes.

The Government will do our best to support all Singaporeans in this significant shift to MediShield Life and the Bill is designed with this in mind. We are facilitating premium payments and eligibility checks for subsidies so that the vulnerable groups among us will receive timely help with minimal hassle. We seek Singaporeans' understanding and help to work with us in extending the support for those who are less well-off amongst us. Individuals should continue to play their part to uphold this collective responsibility that many have pledged their support for, which include leading healthy lifestyles and making wise healthcare decisions. This will go a long way in ensuring that premiums will remain affordable for everyone.

I would like to reiterate that this Bill goes beyond providing the legislative framework for the operation of a national Scheme. It is a Bill that provides many firsts in the Government's efforts to help Singaporeans fulfil their aspiration. Like many first steps, there will be lessons to learn from and things to improve on. We will work with Singaporeans to bring the Scheme closer to our vision as we move forward. If there are hiccups along the way, I am sure there will be, please bear with us and we will do our best to fix them as quickly as we can. Sir, our common aspiration is clear, and the journey towards it has begun. I would like to urge the Members of the House to give your support to the MediShield Life Scheme Bill and join us in this journey towards a more inclusive, caring and progressive society. Sir, I beg to move.

Mr Deputy Speaker: Dr Lily Neo, you have a clarification; not another speech, please.

6.37 pm

Dr Lily Neo: Thank you, Deputy Speaker. I would like to seek one clarification. May I ask the Minister how big is this Premium Support Fund and should this become depleted, will those in dire need tap on the MediShield Fund down the road?

Mr Gan Kim Yong: We have provided certain budgets based on our estimates but, again, this is a new Scheme, and we will allow the Scheme to roll out. And I am sure the Minister for Finance is very supportive and, if need be, I will have to go to the Minister for Finance to beg for more money to help us ensure that all Singaporeans, whether they are from low income or middle income, will all be able to afford the premiums under MediShield Life.

Mr Deputy Speaker: Mrs Lina Chiam.

Mrs Lina Chiam: Thank you, Deputy Speaker. I would like to seek a clarification from the Minister. In my speech, I mentioned that the CPF Board is allowed to engage legalised debt collectors to collect the outstanding premium payments. Did I hear the Minister say "loan sharks"?

Mr Gan Kim Yong: I beg your pardon. So, if they are legalised, then they are legalised and they ought to operate properly. But primarily, we intend to appoint the CPF Board as well as the Inland Revenue Authority of Singapore (IRAS) to be our agents.

Mr Deputy Speaker: Miss Penny Low.

Miss Penny Low: Thank you, Deputy Speaker. Clarification, Sir. The Minister mentioned that MediShield premium payments can be paid for by immediate family members. I laud that, but my question was whether it will allow siblings, the more well-to-do siblings, to pay for the less well-to-do siblings and also whether multiple account payees could contribute to one single account. Obviously, that would be up to a certain ceiling per year.

Mr Gan Kim Yong: These are very exceptional circumstances because we also want to make sure that even as you tap on other members' accounts, you do not deplete the Medisave balance of the other members. So, we will encourage members who have difficulties to appeal to CPF and we will consider, on a case-by-case basis, to allow them to do so.

Mr Deputy Speaker: Last clarification, Miss Low.

Miss Penny Low: Just a further clarification on that. I do not mean just from the Medisave account but also cash top-ups, whether they could also be given some form of tax exemption, like the case of topping up for parental CPF accounts.

Mr Gan Kim Yong Mr Gan Kim Yong: Sir, I believe there are already existing incentives for tax benefits for CPF top-ups and some of the top-ups will go into Medisave. We will explore whether we have other incentives to encourage people to top up purely for Medisave. This is probably something we can look at going forward.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. – [ Mr Gan Kim Yong ].

Bill considered in Committee; reported without amendment; read a Third time and passed.