Rising cost of health care

Many people are worried about the rising cost of health care. The insurance agent tell them that the solution is to buy private shield insurance. This is bad advice, especially for people who have a tight budget and do not have sufficient savings for their retirement.

My reasons are explained in several FAQs that can be found in my website, www.tankinlian.com/ask.aspx. You can search for them by using the keyword "Shield" or "health".

The insurance agents tend to exaggerate the need frequency and high cost of medical treatment to get people to buy private shield. Here are the reasons why you should avoid spending this money:

• Young people have a low incidence of serious illness
• If it happens, they can be treated at a low cost in a subsidized ward or will be paid by the employer
• By buying private shield, you have to pay a higher premium and a higher co-payment for treatment
• There is the risk of the claim under private shield being rejected due to non-disclosure or exclusion. You can read a few stories of rejected claims in my website. 

The cost of health care can increase 5 to 15 times for older people. If the buy private shield, the cost can be 2.5 to 4 times of Medishield. To keep the cost at a more manageable level, the elderly people insure under Medishield and pay a lower premium and a lower co-payment when they are hospitalised.

Private shield should only be bought by people who are wealthy and have more than enough savings for their retirement, and want to have the choice of their own doctor, and do not mind paying a higher premium and higher co-payments.

Tan Kin Lian