ELDERSHIELD SCHEME (Review)

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ELDERSHIELD SCHEME:

(Review): 6.

Mdm Halimah Yacob asked the Minister for Health whether the Ministry has any plans to review the ElderShield Scheme to make it a more effective disability insurance scheme.

7.

Mdm Halimah Yacob asked the Minister for Health (a) how many Singaporeans are covered under the ElderShield scheme; (b) how many have benefited from this scheme since its inception; (c) why does it take three months to process a claim for payment under the scheme; and (d) what is the rationale for making an insured person pay for the fees of the doctor certifying the insured's eligibility for payment under the scheme.

The Minister for Health (Mr Khaw Boon Wan): Sir, with your permission, I will take Question Nos. 6 and 7 together.

Mr Speaker: Yes.

Mr Khaw Boon Wan: Sir, ElderShield was launched in June 2002, three years ago. Currently, there are more than 700,000 policyholders. So far, 1,200 policyholders have benefited from ElderShield.

Processing of claims takes about three months. This is referred to as the deferment period, a standard feature practised by the industry, to help sieve out claims which may be due to a short-term injury.

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ElderShield requires claimants to pay for the medical assessment. This is another common industry feature to cut out frivolous claims. As it is important to have objective criteria to ensure fairness and consistency in the claims process, ElderShield claimants need an independent assessment from a doctor who is trained to assess disabilities.

Mdm Halimah asked if I would be reviewing the ElderShield scheme. I remember Mr Gan Kim Yong asked me a similar question a year ago. The current ElderShield scheme comes with a binding five-year contract with the two insurers. The contract will end in 2007. Once the implementation of the MediShield reforms is well underway, I will start to review the ElderShield scheme.

Dr Lily Neo (Jalan Besar): Sir, may I ask the Minister how does he address the issue of the poor elderly who cannot afford the premiums of the ElderShield due to their age group, and yet are the ones who are most in need of ElderShield payout should the need arise? Are there avenues to help this group? Does our present system tilt towards the heavy demand on nursing homes for the dependent elderly should there be a review to ensure better use of resources and avoid unnecessary institutional care?

Mr Khaw Boon Wan: Sir, I think my predecessor, Minister Lim Hng Kiang, took care of that. When he introduced ElderShield, he also introduced IDAPE, which is precisely to look after Singaporeans who are excluded from ElderShield because they have pre-existing disabilities or because of lack of financial means or being outside of the age group.

As to the general question about how do we take care of the poor and the

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elderly in nursing homes or in the acute hospitals, all the Health Ministers before me, and myself and future

Ministers, address this problem by making sure that we have proper safety nets in place. And I have on previous occasions elaborated on that. There are multiple layers to those safety nets, and provided everyone plays their part, nobody needs to worry that they will be excluded, whether it is from acute care or nursing care, if they are poor.

Mdm Halimah Yacob: Sir, the number of 1,200 out of 700,000 policyholders only benefiting from ElderShield seems to indicate a very small number. Is there any particular reason why the number is so small? Is there some way in which this policy, before it is ultimately reviewed in the year 2007, can be made more effective from now up to the period of review?

The Minister explained that three months is the standard policy in the insurance industry for processing of claims and it is also a standard policy that the claimant has to pay for the fee for certification by the doctor. That may be so for the private sector insurance industry. But for a national scheme or public scheme, used by those who cannot afford the private scheme, the rules should be made more flexible. Therefore, can the three months' processing time be reduced? Also, can the insurance company or the plan absorb the certification fee by the doctor?

Mr Khaw Boon Wan: Sir, honestly, I have no idea yet whether 1,200 out of 700,000 by year two is small. In due course, when I have gone into the details of this scheme, and particularly after taken into account experience overseas, I will be able to make a better judgement by then. The problem is this. This is a long-term disability insurance scheme and it started off by taking in only people

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without pre-existing disabilities. So the number of successful claims will build up. Once you are disabled, you add to the number cumulatively. Those who were already disabled at the time of the launch of the scheme were automatically excluded. So I am not surprised that the numbers will be small at the initial stage. But whether this is actuarially too small or too big, I will be able to make a better judgement after I have gone into the details of the review.

As to the question on the three months' claim process and also the assessment fee, as I said, these are fairly standard industry procedures. I have looked at other similar insurance plans overseas - Japan, US, UK - they set an even longer claim period, some as long as six months. So I thought three months seem reasonable, but we will certainly take the comments into account when we review this. As to whether the fee is affordable, it is only $25, which I think ought to be fairly affordable for most claimants, if not all.

Dr Lily Neo: Mr Speaker, Sir, may I say that, if a person - I am just talking about ElderShield - is unable to perform the three activities of daily living of washing/dressing, feeding, toileting, and has problems of mobility and transferring even with the aid of special equipment and always requiring the physical assistance of another person throughout the entire activity, it would be unlikely for him to get better with time, and, in fact, he would be likely to get worse. Therefore, is it not inhumane to withdraw the ElderShield payout after five years irrespectively, and is the $300 per month too meagre an amount for survival for such a person?

Mr Khaw Boon Wan: Sir, I have read from the Hansard a similar debate in this House between Dr Neo and my predecessor precisely on these two points. I

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suppose I could rehash, repeat or re-broadcast Minister Lim Hng Kiang's reply. But let me take a second look at it again. It is clearly on my workplan for next year - the review of ElderShield. I took my time on this because partly I felt that the MediShield reform is much more urgent. And, really, I am already losing sleep over MediShield, and I cannot afford to lose further sleep over ElderShield. It is something that I will study carefully next year.

I remember Minister Lim Hng Kiang's reply to both questions, which is, not in so many words, that "there is no free lunch". If you want better payouts, the premiums will be larger. If you want less premiums, then the payouts will have to be shrunk. Anyway, let us take a look, now that we have two-and-a-half years of claim data and another 12 months, three-and-a-half years of claim data, we can better judge whether the policy has been over-priced, in which case it will be a nice problem, as it is a matter of extending the benefits or reducing the premium. If the review were to come to a conclusion that the premiums are not enough, we will have a bigger problem. But I think I will rather keep my options open at this stage.