Private healthcare insurers urged to relook overly generous products: MOH

Need for balance in providing protection and encouraging prudent consumption

- Yap Wei Qiang Correspondent

Private healthcare insurance is in its current unsustainable state due to excessive competition that has gone wrong, said Minister of State for Health Rahayu Mahzam.

Insurers, private hospitals and providers have got themselves tied up in a knot, resulting in escalating private hospital bills, rising insurance premiums, and more safeguards introduced to the claims process.

To start untying this knot, the Ministry of Health (MOH) has urged the insurance industry to relook its overly generous policy design, such as minimal rider co-payment - the proportion of bills to be paid by the policyholder.

"Insurers will need to balance between providing assurance and protection, and encouraging prudent consumption and servicing," she said in Parliament on Sept 24.

Ms Rahayu said the current state was not caused by collusion or anti-competitive behaviour, which would have led to supernormal profits by market players, at the expense of consumers.

Instead, Integrated Shield Plan (IP) insurers are either making losses or barely breaking even on their health portfolios.

An IP is a private medical insurance plan, offered by seven private insurers here, which provides additional coverage on top of the national MediShield Life scheme.