In July, Health Minister Ong Ye Kung said that private health insurers and private hospitals have “gotten themselves tied up in a knot, to the detriment of all stakeholders, including patients”.
The “knot” came about in big part due to insurance design, he said at the time. “Insurers know that policyholders are worried about incurring an unexpected huge hospital bill, so they launch insurance products that offer generous coverage to win customers and market share.”
These products include “as-charged” or no-limit coverage, as well as riders that will cover almost all costs.
In such cases, as insurers are footing almost the entire bill, there is the tendency to “use more than is necessary”, said Mr Ong then, calling it “human nature”.
According to MOH data, private hospital policyholders with riders are 1.4 times as likely to make a claim as those without riders, and their average claim size is also 1.4 times higher.
