Coming in October: A ‘new ElderShield’, plus more flexibility in MediSave use.
Did you know that 1 in 2 healthy Singaporeans aged 65 could become severely disabled in their lifetime, and may end up requiring long-term medical care? Good thing then, that Singaporeans can soon look forward to greater cash support to help pay for long-term or disability care.
Come 1 October, we’ll see the launch of two new healthcare schemes –– CareShield Life and MediSave Care –– designed to provide monthly cash payouts to Singaporeans aged 30 and above who suffer from severe disability or as long as they require long-term care. This benefit is available for life.
CareShield Life will be replacing the existing ElderShield scheme, whereas MediSave Care introduces a new option for individuals to use their MediSave balance.
Here’s a detailed breakdown of these two new schemes.
CareShield Life: A bigger, better Eldershield
Calling CareShield Life a bigger and better ElderShield isn’t just hyperbole. It is literally true in three important ways.
|Monthly cash payout||$600 to $1,200||$300 to $400|
|Payout duration||As long as severe disability is present or long-term care is required.|
Coverage is for life.
|5 to 6 years|
|Premiums paid via||MediSave||MediSave|
Right out of the gate, CareShield Life offers higher payouts, providing cash of between $600 and $1,200 each month.
In comparison. ElderShield pays either $300 per month for up to 5 years, or $400 per month for up to 6 years, depending on which plan you enrol in.
CareShield Life also lasts longer, offering coverage for life. Meanwhile, ElderShield payouts only last 6 years at the most.
Thirdly, CareShield Life has a lower auto-inclusion from age 30 onwards, and covers pre-existing disabilities. ElderShield coverage only starts from age 40 onwards.
More inclusive long-term disability support scheme
With these changes, CareShield Life can be seen to be a more inclusive support scheme catered to Singaporeans with severe disabilities or those who require long-term care.
By lowering the auto-inclusion age to 30, persons with disabilities can receive financial assistance earlier in life. It also helps the scheme stay affordable, as premiums are now paid starting from age 30 (instead of age 40, in the case of ElderShield).
More importantly, CareShield Life is automatically extended to all eligible Singaporeans, regardless of pre-existing medical conditions and disability.
Pay premiums until age 67 for higher monthly payouts
CareShield Life offers monthly payouts that increase as you continue paying premiums, so the further you go without making a claim, the higher payout you can eventually receive (should you need it).
It works like this. When you are auto-enrolled at 30 years old, you will start paying premiums for CareShield Life, until you hit age 67. If, during this period, you decide to make a claim for long-term care, you won’t have to make any more premium payments.
If you make the claim at age 30, you’ll receive $600 per month. This payout increases for each year you continue to pay premiums, reaching $1,200 per month if you make a claim at age 67. If you make your claim at any age between 30 and 67, your monthly payout will be correspondingly adjusted.
At present, premiums and payouts for CareShield Life are pegged to grow by around 2% per annum for the next 5 years, with adjustments to be made as the need arises.
Auto-enrolment for those born in 1980 onwards
|Cohort||Inclusion in CareShield Life||Notes|
|Born between 1980 to 1990||Automatic||1 October 2020, or upon turning 30|
|Born in 1990 or after||Automatic||Upon turning 30|
|Born in 1979 or earlier||Opt-in||End-2021, must not be severely disabled|
|Born between 1970 and 1979||Automatic||End-2021, must be on ElderShield 400, must not be severely disabled|
May opt-out to remain on ElderShield before end-2023.
All Singaporeans born in 1980 to 1990 will be automatically enrolled on 1 October this year, or upon turning 30.
For those born in 1990 or after (making you 30 or younger this year), you will be automatically enrolled when you turn 30.
For those born in 1979 or earlier, CareShield Life is optional. However, if by end 2021, you are not suffering from severe disability, you may apply to switch over from ElderShield to CareShield Life. There is no age limit for this conversion.
And for those born between 1970 and 1979, who are on ElderShield 400 and not severely disabled, you will also be automatically enrolled. However, you may opt out of CareShield Life (thereby remaining on ElderShield) before end-2023 should you so wish.
MediSave Care: Cash booster for long-term care
CareShield Life is a big step in the right direction, and will no doubt help many disabled families cope with necessary medical costs. But what if you need just that tiny little bit more cash to make ends meet?
From 1 October onwards, Singaporeans and Permanent Residents with long-term care can help fund their budget using their MediSave savings.
Under the new MediSave Care scheme, Singaporeans with severe disability may withdraw up to $200 per month from their MediSave accounts as a cash supplement.
However, there must be a minimum balance of $5,000 in MediSave so as to ensure premiums for MediShield Life, hospitalisations and other crucial medical costs remain covered.
Individuals who do not have enough MediSave savings may tap on their spouse’s MediSave account for the cash supplement.
Refer to the table below to see how much MediSave Care cash you may withdraw.
|MediSave Account Balance (at point of withdrawal)||MediSave Care monthly withdrawal|
|$20,000 and above||$200|
|$15,000 and above||$150|
|$10,000 and above||$100|
|$5,000 and above||$50|
By Alevin Chan
An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.
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