CLOSURE OF MEDISAVE ACCOUNT FOR THE ELDERLY

Mr Philip Tan Tee Yong asked the Minister for Health, in view of the fact that a Central Provident Fund member can utilize his Medisave account for the payment of medical bills of his parents and grandparents, whether he will consider (i) allowing an elderly person with children and/or grandchildren to withdraw all his moneys from his Medisave account, and (ii) exempting an elderly worker from contributing to his Medisave account even if he has less than $15,000.

Mr Yeo Cheow Tong (for the Minister for Health): Mr Speaker, Sir, a person reaching the age of 55 before the end of this month will only need to retain in his Medisave account a sum of $5,500 or his actual Medisave balance, whichever is the lower. He can withdraw the amount in excess of this $5,500.

It has been established that an average person can expect to be hospitalized a total of 59 days from the age of 55 to the time he dies. The bulk of these hospitalization days will be during the last six months of his life. This amount retained in the Medisave account will allow the elderly to look after their own hospitalization needs, and that of their spouse, thereby reducing the financial pressure on their children or grandchildren.

A Medisave account holder who continues working after the age of 55 will also continue his Medisave contributions. The amount in excess of the prevailing Medisave limit may be withdrawn once in every three years.

Mr Philip Tan Tee Yong: Sir, will the Minister of State consider that if the children are willing to defray the medical costs of their parents or grandparents, will the elderly person be allowed to withdraw all his funds?

Mr Yeo Cheow Tong: Mr Speaker, Sir, where the elderly have the means to support their own hospitalization needs, we should encourage them to do so without burdening their children, without increasing the financial pressure on their children. The amount at the moment retained in the Medisave balance of the elderly, ie, those people above 55 years old, is only $5,500. This will increase to $6,000 from 1st April. This amount, I can assure the House, will be barely adequate to look after his own hospitalization needs as well as that of his wife.

Mr Philip Tan Tee Yong: Sir, will the Minister of State not agree that if an elderly person has a house of his own, and when he passes away, the house will be bequeathed to the children or grandchildren? If that is the case, the children or grandchildren will benefit from the death of this elderly person. Is it not right for the elderly person now to enjoy the fruits of his labour while he is alive?

Mr Yeo Cheow Tong: Mr Speaker, Sir, if it is the objective of every parent to leave the minimum to his children when he dies, then I think we would have many of the elderly selling their house by the time they reach 55 years and take up rented accom- modation so that they can enjoy the fruits of their investment.

Dr Augustine Tan: Does not the Minister of State agree with me that if the children of an elderly person have adequate or more than adequate funds in their Medisave and are willing to use those funds for this elderly person, and furthermore they are ready to give a written undertaking to that effect, then should he not therefore allow the elderly person to withdraw his or her own Medisave funds?

Mr Yeo Cheow Tong: Mr Speaker, Sir, I think it is important for us to get the aim of the Medisave Scheme in the right perspective. The aim of the Medisave Scheme is to ensure that every one has adequate funds to look after primarily his own hospitalization needs and his immediate dependants' needs. If his parents do have the ability, through their own Medisave funds, to look after their hospitalization needs, I think it is important for the parents to continue using their own funds, and relying on the children only when their own Medisave balances are used up. This will ensure that their children will, in turn, have adequate funds of their own because they must inevitably also reach the age of 55.

Dr Augustine Tan: Mr Speaker, Sir, is it not the greater aim to prevent the dependence upon the people at large, through taxation or increased taxation, to bear the cost of medical bills? But if the children of an elderly person have adequate Medisave funds and they are still relatively young and have future earnings to come and future balances to build up in their Medisave accounts, surely the Minister of State should consider favourably this particular request. And surely also he should consider the fact that while many old people under the present scheme will have adequate money in their Medisave accounts to finance the last few months of their lives here on earth, but at the same time they will be miserable and without food for the last few years of their lives.

Mr Yeo Cheow Tong: Mr Speaker, if the children have more than adequate Medisave balances, their excess will be paid into their Ordinary CPF account, thereby allowing it to be used for their own housing or investment needs. The children, if they are that well off, can easily provide for the daily needs of the parents, if that is the case. It is important for us to ensure that the elderly are able to look after themselves because in the years to come there will be a large number of elderly amongst us. As we have seen in the United States and in the United Kingdom and the other developed countries, the plight of the elderly is fairly serious. In fact, there was an article in the Newsweek magazine last week that highlighted the inability of the elderly in the US to afford proper medical care because of lack of funds. I think it is important for us to bear that in mind and to ensure that we do not get into that same situation in the next 20 or 30 years.

Mr Jeyaretnam: Mr Speaker, Sir, another supplementary question for the Minister of State about the aim of the Medisave. Will the Minister of State again quite candidly concede that one of the principal aims of Medisave was to ensure that Government would be able to recover the cost of medical treatment? Is he aware that very recently the Attorney-General has written a letter to a man who owes the hospital something like $300 and who is at present out of employment, threatening to bring proceedings if he did not pay up the $300?

Mr Yeo Cheow Tong: Mr Speaker, Sir, at the present moment our medical services are very, very heavily subsidized. If it is the intention of the Government, as it is, to reduce taxation and reduce the burden on business and on wage earners, then it is important that we are able to reduce these subsidies in years to come. However, whilst we are reducing the subsidies, the Government will still ensure, as I have stated many times in this Chamber, that the indigent and those who are unable to pay will still be given the appropriate level of medical care. That consideration must always be there. There is nothing wrong with the Government reducing the subsidy because the subsidy is still there and it is going to be still very substantial.

Mr Philip Tan Tee Yong: Question No. 6, Sir.

Mr Jeyaretnam: Mr Speaker, Sir, may I ask another supplementary question?

Mr Speaker: No, because the Member has already asked his Question. Mr Yeo.