Puzzled by insurer's payout for medical claimThe above was written by a disgruntled medical policyholder by the low payout of the medical bills by NTUC Income and this was published in the forum section on the Straits Times last month. Someone by the name of paufurhs has given an excellent breakdown of the medical bill on the ST forum and why the insurer reimburse only $240 back and this is explained below.RECENTLY, my wife was hospitalised at Mount Alvernia Hospital for four days. Her medical bill came up to $7,995.15.
She is insured under Income's IncomeShield Plan MA, but the total payout by Income was a shocking $240.
I called Income to find out how it arrived at that sum and was told that technically the $7,995.15 was classified as "room and board", hence limiting the claim.
The $7,995.15 included a renal screen, bed charges, clinical consumables and supply, diagnostic imaging services, equipment use, laboratory services, outside hospital services, pharmacy cost, resident medical officer fees, treatment fee and doctor attendance fee.
Given a deductible of $4,000 per policy year and 10 per cent co-insurance, any man in the street would expect an insurance payout of $3,595.63. But this is not the case.
My wife has faithfully paid her premium for the past 15 years without a single claim and this is what she gets in return. I am writing this so the public is made aware of such pitfalls in their medical insurance.
For big insurance companies to cite a technicality as an excuse not to make a decent payout is in no way fair. I urge the Consumers Association of Singapore and leaders in the insurance industry to look into this loose definition of "room and board".
In my opinion, given my wife's good record, Income should honour the $3,595.63 payout as a goodwill gesture.
Lastly, I would like to ask the Central Provident Fund Board why only $450 a day can be used from Medisave for hospitalisation.
Ong Kok Lam
In all "shield plans", regardless if it is CPF Medishield or the private shield plans from private insurance companies, "Room & Board" is broadly defined as expenses including meal charges, professional charges, investigations and other miscellaneous charges. In short, in includes any inpatient medical charges not relating to surgical expenses.This is not the first time I have seen this type of cases appearing on the ST forum. The one thing that is rather similar in these cases is that one thinks that as long they have a medical insurance plan such as Medishield, they are entitled to a stay in any type of wards in any hospitals and they expect a large part of the medical bills to be reimbursed back through the medical insurance plan. Unfortunately, this is not true. One has to match the correct plan with the correct class of ward. In this case, the Incomeshield Plan MA which was originally the Medishield Plus A, ran by the CPF Board, is geared towards the coverage of bills in an 'A' class ward and below in a restructured hospital and Mount Alvernia Hospital is a private hospital. Another point is that this plan is not an 'as charged' plan and thus there are limits to the claims for each category. As such, do make sure that you know what you are entitled to under the medical insurance plan which you have subscribed to and in the unfortunate event that you need to be admitted to a hospital, choose the correct class of ward and hospital.
In the gripe letter, and from the description of the expenses, it is very obvious none of the expenses are related to surgery, and so they fall under one category - "Room & Board".
For those who can't figure out how a $7K+ bill can only be entitled to only a $240 reimbursement amount, I breakdown the calculations.
All "shield plans" are integrated with CPF Medishield, thus forming a 2-tier medical insurance plan. During claims, the insurer will calculate which tier will reimburse the most of the expenses incurred, and pay out from that tier.
Incidentally, FYI, a part of the "shield plans'" premiums are paid to CPF Board for the respective Medishield tier.
The bill incurred under the alleged "Room & Board" category was $7,995.15
The limit of claim under the Incomeshield MA tier is $690 per day.
Since patient was warded for 4 days, the max. claimable amount is $2,760.
The established deductible under this tier is $4,000.
As the claimable amount is below the deductible, there will be no payout under this tier of coverage.
Move this $7,995.15 to the Medishield tier.
The limit of claim under the Medishield tier is $450 per day.
Since patient was warded for 4 days, the max. claimable amount is $1,800.
The established deductible under this tier is $1,500 (for B2 ward and above, and for claimable amount between $1,500 to $3,000).
Therefore, the sub-balance after deductible would be $300 ($1,800 - $1,500)
(At this point of calculation, the patient must already bear $7,695.15)
The established co-insurance under this tier is 20% (for B2 ward and above, and for claimable amount between $1,500 to $3,000), which is computed as $60.
Finally, the reimburseable amount under this Medishield tier is $240 ($300 - $60)
The patient bears $7,755.15 ($7,695.15 + $60)
Since the CPF Medisave Account can only be used to pay $450 per day for non-surgical inpatient bills, the patient can only use $1,800 from Medisave to pay for the hospital bill.
The remaining $5,955.15 has to be paid in cash.
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Thanx for your advice here. But it seems very complicated for a lay-man to understand. So any advice how we should choose the medical shield?
ReplyDeleteThe insurers have it all worked out. They hired mathematicians to do the sums, then hire language experts to word it nicely. Finally they hire agents to sell to you. It is in their interest to get the most from you and pay the least. So they design fanciful umbrellas with holes in the right places so any shit hits you right in the eye. How else can their CEOs be sipping red wine and getting a massage while sitting on some of the most expensive chairs your money can buy, thinking of the next exotic alaskan cruise using your money?
ReplyDeleteHi,
ReplyDeleteThe easiest way will be to approach an independent financial adviser or IFA in short as they will do a comparison on the shield plans available in the market and advise you on the most suitable plan. Some IFA firms available locally includes Promiseland and Providend. If we were to just look at the brochures offered by the insurance companies, it does not divulge the finer details of the shield plans which may be crucial.
Kay
I don't think so, Kay. You must be an IFA from one of those Promiselands you mentioned. They promise you what they get themselves. Why have another layer of bloodsuckers to suck you dry? The only one who will really take care of you is yourself. Have another layer of middlemen means havings another layer of risk and loss.
ReplyDeleteThere is a comparison of different shield plans offered by various insurance company in MOH website
ReplyDeletehttp://www.moh.gov.sg/mohcorp/uploadedFiles/Healthcare_Financing/Medishield/Comparison%20of%20IPs_wef%201%20Feb%202009.pdf
I believe that one must really do their homework before buying shield plans as it will really impact your cashflow should anything happen. You should also take into consideration various coverage you have before deciding which plan is best for you (Eg: company insurance)
Liang
Hi,
ReplyDeleteI do not work in the financial field. Of course it's true that no one will care the most about their own interest except themselves. However, not all of us have the interest to read up on financial and insurance stuff, not to mention the jargon that comes with it. In the case, it is better to rely on an IFA to advise you. Not any IFA will do but one that you trust and possess many years of experience. I don't suggest insurance agents because they are tied to the products of their companies that they are selling. Will an Prudential insurance agent recommend you to buy an NTUC Incomeshield plan even though it may be better or vice versa ? That proves my point.
Kay
Hi Liang,
ReplyDeleteThanks for the link. Company insurance are not portable usually thus I suggest that one don't take into account when they are doing their insurance planning. It will be prudent to understand and do their homework when it comes to private shield plans. There is a good discussion @ http://forums.sgfunds.com/viewforum.php?f=40
Do not give up your gold at any cost. They will say 3 days to check authenticity of your gold that you bought from them - its ridiculous. Protect your capital.
ReplyDeleteGreat insurance
ReplyDelete