All you need to know about the new integrated shield riders

With full riders that cover the entire co-payment in Integrated Shield (IP) riders resulting in 60 per cent higher medical bills, the Ministry of Health (MOH) announced a new requirement for IP riders in 2018. This will require insurers to incorporate a co-payment feature in new Integrated Shield riders, thus removing the option of a full rider with zero co-payment.¹

While this requirement was announced in 2018, insurers were given time to work out the new riders and transit their policyholders to the new riders. Therefore, from 1 April 2021 all policyholders will be transited to the new IP riders. In this article, we highlight the three main changes to NTUC Income’s Enhanced Incomeshield rider and how this will affect you as a policyholder.

(See "Are Integrated Shield Plans Necessary?")

#1 Co-payment is now necessary even with a rider

One of the main changes to Income’s Enhanced Incomeshield is the rider. From 1 April 2021, all Plus and Assist riders from NTUC Income will no longer be available for policy renewals. Instead, individuals who are still on the old Plus and Assist riders will have their riders automatically switched to the new Deluxe Care and Classic Care rider respectively.

Previously, individuals with the Plus rider were able to obtain full coverage against hospital bills with no co-payment required. However, going forward this will no longer be available. Instead, policyholders will have to pay out-of-pocket expenses of at least 5 per cent of their hospital bill.

For those who were previously on Assist rider, they will automatically be switched to Income’s Classic Care rider with the same 10 per cent co-payment required for their hospital bill.

(See "Our honest opinions about CareShield Life and its supplements")

#2 Panel and non-panel treatment

Another new feature is the introduction of panel and non-panel doctors. Under the new riders, policyholders will be eligible for a co-payment cap of up to $3,000 per policy year if they seek treatment from the insurer’s panel healthcare providers. While there will still be a 5 or 10 per cent co-payment required, this cap will put a limit on the maximum out-of-pocket expenses required by the policyholder.

However, should policyholders choose to receive treatment at non-panel providers, there will not be a cap for co-payment. Non-panel charges of up to $2,000 per policy year will also apply for Classic Care rider.

Benefit payable from the new Deluxe Care and Assist Care riders:

This new feature is meant to encourage policyholders to receive treatment at panel providers. Doing so will limit their out-of-pocket expenses to no more than $3,000 per policy year for both Deluxe Care rider and Classic Care rider.

Do note that the main treatment must be provided by the panel provider in order for the claim to be considered as panel and have a co-payment limit. This also applies to pre/post hospitalisation treatment and special benefit claims.

(See "Don't Need A Full Critical Illness Plan? Here's Your Alternative")

#3 Hospital cash benefit

The hospital cash benefit refers to a fixed amount that the policyholder will receive if he is admitted to a ward that is lower than the ward his plan entitles him to. For example, a policyholder will receive this hospital cash benefit if he has a plan that covers for Class A ward but choose to stay at a Class B1/B2 ward. This is given on top of the policyholder’s existing medical benefits.

While both Plus and Assist riders used to offer this hospital cash benefit, this will no longer be available in the new Deluxe Care and Classic Care riders. Policyholders will therefore not be entitled to any additional cash benefits for choosing to stay in a lower class ward.

(See "Fixed or Renewable – Which is the better term insurance?")

What these changes mean to us

These changes to Income’s Enhanced Incomeshield riders are likely to result in higher out-of-pocket expenses for us. This is because full riders are no longer available with a minimum 5 per cent co-payment now required for our medical bills.

Additionally, policyholders are also encouraged to opt for panel clinics so as to enjoy less out of pocket expenses. This may impose some limitations on the flexibility to choose your own preferred doctor.

^{*Assuming coverage for Income Enhanced Preferred plan}

^{^Information shown are based on the private bill size of 2019 incurred claims for policyholders with NTUC Income’s Plus and Assist Riders.}

With changes to integrated shield riders, are these riders still worth obtaining? In our next article "Disappointed with the new integrated shield riders? This is what we think", we explore some alternatives for hospitalisation coverage.

If you would like to find out more about the changes or would like a second opinion on whether you should make any changes to your hospital plan, you may contact us here. At FSMOne, we also offer commission rebates for life insurance products, speak to our advisers if you would like to find out more.

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_{¹Source: https://www.moh.gov.sg/docs/librariesprovider5/pressroom/current-issues/cos-2018-media-factsheet---keeping-healthcare-costs-sustainable-for-all-singaporeans.pdf}