Ministry of Health Eldershield Life is a bad idea
The govt requires all CPF members to buy Eldershield Life to provide payment of $300 or $400 when they are severely disabled and need to have nursing care.

Even Singaporeans who work overseas are required to buy this compulsory insurance on the assumption that they will return to live in Singapore during their old age.

This is a bad approach.

Why?

a) The premium for this compulsory insurance is high, relative to the actual claims. The insurance companies are making a large profit.

b) The monthly benefit of $300 to $400 is inadequate to pay for the nursing home expenses, which can amount to $2,500 a month, or more.

What is a better approach?

It is better for the govt to provide the premises free to the operators and to control the fees charged by the nursing homes. This can reduce the monthly cost by about half. This is just my estimate.

For elders who have to be taken care at home, the cost of home nursing care can be subsidized by the govt. 

The goal should be to reduce the cost by improving efficiency and maintaining a standard of quality. 

The cost incurred by the govt can come out of taxation. It will not be a large sum.

By requiring the CPF members to buy compulsory insurance in advance for this nursing care, the cost is increased by administration, marketing and profit margin.  This is good for the insurance industry but is at the expense of the public. It also increases the cost that is borne by the economy.

There is no point to spend so much money to operate an insurance scheme that does not really serve any purpose. This cost could be avoided.

Tan Kin Lian




 

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