Award-winning graphic novelist Sonny Liew baffles on how MediShield Life derives its payout for a patient’s surgical bill

Award-winning comic artist Sonny Liew recently expressed his confusion on his Facebook page (31 December) over how MediShield Life only paid S$4.50 for an elderly man’s S$4, 477 post-subsidy bill.

Mr Liew’s post was in response to an article published by The Straits Times on how the national insurance only paid Mr Seow Ban Yam S$4.50 for his cataract operation, while it was actually meant to cover 90 per cent of S$1, 477.

The article says that Mr Seow’s total bill was more than S$12,000 but the amount reduced after subsidy from the government.

“The government subsidy for the surgery was S$7, 559, leaving him with a bill of S$4, 477. Since MediShield Life requires people to pay for smaller bills, it does not cover the first S$3, 000 each year. After that was paid, the remaining amount was S$1, 477. Mr Seow’s understanding was that MediShield Life would foot 90 per cent of it. But the national insurance scheme has set claim limits for different set of procedures, based on surgical costs set by the MOH.”

The article went on further and explained that, “The procedure Mr Seow underwent has a cap of            S$2, 800 from MediShield Life, although the SNEC charged him S$4, 272 for it. Apart from the surgery, the insurance also covered the cost of his one-night stay and ‘consumables’ which totalled S$205. The Central Provident Fund Board said that the maximum reimbursable amount was S$3, 005. Since the first S$3, 000 each year has to be paid by the patient, that left S$5 of the bill that was claimable from insurance. MediShield Life paid 90 per cent of that, or S$4.50.”

Upon reading this article, Mr Liew find it rather confusing on how the insurance company came up with the amount that it should cover. He said that there are several different things mentioned that turned out to be rather confusing for him.

“MediShield Life is supposed to cover 90% of "the rest of the bill" (or according to the info box "90 per cent for the first $5,000 of subsidised bills"). This presumably should have meant 90% of the $1447 post-subsidy (more accurately, post-subsidy and post-Medisave) bill, ie: $1329.30,” he pointed out.

He continued, “The MediShield Life Scheme "set[s] limits for different types of procedures, based on a table of surgical costs set by the MOH (Ministry of Health)", and the one that Mr. Yam had has a $2800 cap. That suggests the $1329.30 would have been within the cap. CPF says the "maximum reimbursable amount" is $3005.”

For Mr Liew, the S$3, 005 mentioned by CPF seems to be the key to this rather perplexing story since this is the figure that determined the amount paid by the insurance company.

“$3,005 minus what Mr Yam paid via MediSave ($3000) is $5, so 90% of $5 is the $4.50 mentioned in the headline,” he wrote.

Puzzled over where the amount S$3, 005 came from, Mr Liew questioned “why would this figure minus the amount paid by MediSave be the basis of the MediShield Life payout, rather than the S1, 447 post-subsidy-plus-MediSave bill? Does anyone know?

However, thanks to two Facebook users named Daniel Ong and Kerry Cheah, Mr Liew finally solved the mystery. The amount S$3, 005 is actually derived by adding the claim cap limit (S$2, 800) and the ward fees (S$205). Therefore, the national insurance only covered 90 per cent of this amount.

Mr Liew said that it seems to be that it wasn’t clearly conveyed to Mr Yam that he was being charged S$1, 472 more than the upper bounds of benchmark pricing provided by the MOH.

He also thanked everyone for helping him understand these things a little better.

After sharing his post online, many netizens also opine that the system is too complicated for a layman to understand.

Meanwhile, Facebook user Harminder Singh says that the all these schemes should be removed and higher taxes to be charged and have free healthcare. He thinks that these schemes add "enormous costs to the healthcare system, and are a 'boondoggle' (or buffet) for various agencies and firms that can 'clip the ticket' for doing almost nothing of value."

On the other hand, John Cheong says that although MediSave and MediShield Life programs seem complicated, but they do "provide adequate cover for medical expenses most of the time if you are a subsidised patient - but most of these patients won't be telling you that they benefited from it." He went on to say that the "current system don't have a good way of managing outliers and pushes the additional costs to the patient."

However, he says that the government is worried of Singapore's rapidly ageing population and shrinking tax base which will create huge imbalances in Singapore's healthcare financing system in the future. This is why this complex issue will require significant considerations both in terms of strategic direction and practical implementations.