CareShield Life and Long Term Care Bill – Speech by Png Eng Huat

(Delivered in Parliament on 2 September 2019)

Mr Speaker, anyone who has aged parents or loved ones to look after would know that providing long term care for the elderly, especially those who need help with activities of daily living, is a very daunting task.

In a small family environment, the burden of care for the elderly would fall squarely on one or two members of household.  For a family with no children, such burden would exacerbate rapidly when the couple grows old, and neither one of them is able to care for one or the other.

At our Meet-the-People Session, we would have heard stories of the struggles and challenges faced by our residents in looking after the elderly, while trying to raise a family of their own and having to make ends meet all at the same time.

We heard in this chamber last year that this government intends to focus on building an inclusive society where no Singaporean, young or old, healthy or sick, gets left behind.  The CareShield Life and Long-Term Care Bill is a step in that direction.

In the debate on the motion on ElderShield and CareShield Life in the middle of 2018, the Workers’ Party MPs spoke in support for the rationale to strengthen our social safety net for the long-term care needs of Singaporeans.  CareShield Life, as the Minister had stated then, would be a basic protection scheme for Singaporeans against severe disability during their old age, and the scheme would be inclusive, affordable and sustainable.

On the point of inclusivity, I would like to ask the Minister what would happen to the fate of Singaporeans who are currently disabled, mild or severe, when CareShield Life kicks in.

Under Clause 6 Subsection (4)(b) of the proposed bill, the CPF Board may determine that an individual who is severely disabled currently may be covered under CareShield Life, but only if the individual satisfies such conditions as may be determined by the Minister in any particular case where the Minister considers appropriate.  Such case by case basis assessment at the sole discretion of the Minister does not provide any assurance that CareShield Life is going to be inclusive for Singaporeans who need the basic protection most.  And what about Singaporeans who are unable to do 1 or 2 out or 3 activities of daily living currently?  Would they be able to enrol into CareShield Life or to be assisted by Elderfund only as highlighted by the Minister earlier?

Sir, there are also Singaporeans who withdrew from ElderShield not by choice but by the fact that they had nothing left in their Medisave accounts to service the premiums and they had no ability to pay the premiums in cash.  I happy to note that the Minister will find ways to enrol these vulnerable Singaporeans into CareShield Life since the scheme is going to be made compulsory for all over time.

Next, on the point of affordability, I would like to ask the Minister to share with the House on the impact of the introduction of CareShield Life on the adequacy of the Medisave accounts for future cohort of Singaporeans who would be enrolled into the compulsory scheme upon attaining the age of 30.

Take the case a young father who is servicing the MediShield Life premiums for his children and himself, and perhaps even his spouse, using his Medisave account.  Would this person have enough in his Medisave account to pay for CareShield Life as well or when the transitional subsidies for the scheme end?

The affordability of CareShield Life needs to be considered in context with MediShield Life, since both schemes are made compulsory for Singaporeans.  Is there any impact study done on the adequacy of the Medisave accounts of our young working class Singaporeans with the introduction of such mandatory insurance schemes?

On the same issue of affordability, may I ask the Minister again, are the premium calculations for Careshield Life heavily influenced by the MOH estimates that 1 in 2 Singaporeans aged 65 and above could become severely disabled in their lifetime?  If we were to strip away the international data from the MOH estimates, how would the percentage look like?

Sir, the international data cited by the Minister that 52% of Americans turning 65 in 2016 would develop a disability serious enough to require long-term care does not even apply in the context of CareShield Life as these people may not even qualify to claim under the scheme unless they cannot do 3 out of 6 activities of daily living.  Would the Minister not agree that using data that may not even trigger a claim under the proposed scheme to help calculate the corresponding premium to pay for an insured person would not be meaningful to begin with?

So in the interest of transparency on the affordability and sustainability of the scheme, would the Minister be able to publish a brief of the factors and assumptions made in the premium pricing model for CareShield Life?  The Senior Minister of State had mentioned some of these factors in passing in his speech on the subject last year.

Factors such as the disability mortality rate, recovery rate, disability incidence, and risk profile for various cohorts, to name a few, are important information for the public, not just to determine whether Singaporeans are being charged baseline premiums or way above it, but to spur them to make informed choices to live healthy.

Mr Speaker, this government should also see considerable savings in the administration cost for CareShield Life when it takes over the respective pool of insured persons from the 3 private Eldershield insurers.  What is the projected savings from this exercise and did the ministry work this savings into the premium calculations?  And what would be the projected profit and loss for the CareShield Life scheme under the sole administration of the CPF Board assisted by AIC?

Although this is a not-for-profit insurance scheme, it does not mean that there would be no profit generated.  I am sure the ministry would have crunched the numbers in the run-up to the introduction of CareShield Life.  It is in the public interest that the ministry should release such information.  I am also sure the ministry can easily illustrate the technical details of the actuarial model for CareShield Life in simple graphics or something easy for the general public to digest.

Thank you.