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If Your Hospitalization Plan Is Getting Too Expensive...

Updated: Dec 17, 2019

In recent years, you have likely received letters from your insurer that your next year's premiums will be increasing.

The fact that they need to increase and change certain terms and conditions was mainly because most insurers are losing money in this segment.

Some of my friends had feedback to me, I did not make any claims in the past few years, why should I be penalized for it?

I don't have a direct answer to the question.

These changes were due to the over-consumption of medical services given that many people are on full hospitalization coverage.

Some folks took advantage of the full coverage and started the "buffet syndrome". This became a slippery slope for the industry. As a result, with effect from Mar 2018, the industry had shifted from a full hospitalization coverage to a co-payment structure.

Wait, does that mean I will be affected by this new change?

As of now, if you already have an integrated shield plan with rider that covers your full medical bill, you do not have to worry about the new changes.

However, chances are, you may come to point where you find the premiums are so exorbitant that it makes more sense to choose a co-payment rider.

Depending on the company you are with and your current age band, the cost savings could be between 30 to 50%.

The premiums are too expensive, what are the different options available?

Before I go into the details, here comes the standard disclaimer:

I do not represent any company to write this article. This article is not meant for you to switch, change, stop your existing shield plan. This article is meant for educational purposes only. Kindly do your due diligence prior to making any changes. Once you change your shield plan, there is no turning back. You could potentially lose your full coverage. So please, speak with your advisor before making any changes.

And with that out of the way, I would like to share some hacks to get over this plight. :)

#Hack_1: Downgrade from full to partial coverage

For most companies, they have implemented what the industry calls a partial rider.

This is very similar to the new rider where there is a co-payment involved. Most co-payment riders require the patient to pay a 5% co-payment. This amount is generally capped at $3,000.

As such, with this feature, most people feel safer knowing there is a cap to the medical bill.

However, do note that some companies have added some variables to this partial rider.

The cap of $3,000 only applies if the patient goes to the respective insurer's panel doctors.

Then comes the next question, what happens if I'm being treated by a non-panel doctor?

That would, again, be dependent on the insurer you are with.

Some companies will not cover your co-insurance & deductibles.

(If you are new to the jargon, you may visit here for details.)

Some companies require you to get a pre-authorization (regardless if it is panel or non-panel).

And if it's non-panel, most companies will likely have additional fees imposed. The fee could range between $1,000 to $2,000.

Here's Example 1 to simplify the above.

Mr T was down with a heart attack. He was admitted to the nearest hospital for an emergency operation.

Thankfully, Mr T survived and was discharged. The bill came up to $100,000.

If the treating doctor is from the company's panel listing, Mr T would need to pay 5% ($5,000) cap at $3,000.

On the other hand, if Mr T was treated by a non-panel doctor, he would need to pay 5% ($5,000) and $2,000 (additional fees). That would be $7,000 in total.


The simple act of downgrading from full to partial rider could have a significant cost savings of 30 - 50%. Cumulate this across a few decades, this amount could be substantial.


You will need to seek treatment from the insurer's panel doctors. Should you choose to go with other doctors, then the co-payment portion potentially could be huge. Still, the overall cost savings may offset this huge co-payment when the time comes.

#Hack_2: Downgrade to a lower tier plan

If you are on private coverage, you may want to consider a government coverage plan. If you are covered up to the government "A" ward, then the next level coverage will be up to the government "B1" ward.

Some of you may worry that you can no longer consult private doctors. The short answer is you still can. You just need to pay the pro-ration factor.

Another example to illustrate the point.

Example 2: Mr T decided to downgrade from private to government coverage. The pro-ration factor is 65% for his insurer.

This means that the $100,000 bill, the insurer would pay 65% while the remaining amount, Mr T would need to fork out.

If he goes to a government hospital, the bill would be 100% covered by his insurer.


Similar to Hack 1, the cost savings could be as high as 70%. Likewise, if you snowball this amount across multiple years, this amount could be astronomical.


The waiting queue in a government hospital could be pretty long. I had heard of cases where it took weeks or months to fix an appointment with a specialist. Not to mention, you may be assigned to a junior doctor who may not have sufficient experience to treat you.

Additional note

For government coverage, there is no need to worry about the panel or non-panel variables. Oh, all government doctors are considered panel doctors.


As of now, based on what I can foresee, it is only a matter of time before most people will switch from full coverage to the new co-payment structure.

Hence, instead of brooding and lamenting that the industry is unfair to you, it makes more sense to move forward with the trend and get used to the co-payment environment.

And if I haven't already stressed this enough, any change to your full coverage is a one-way ticket. So please please, do consider all options and discuss with your advisors first before making any changes.

Should you require a second opinion, you can consider reaching me here.

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