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Uniquely Singapore

Medishield – one of the most profitable in the world

Leong Sze Hian

I refer to the Committee of Supply debate in Parliament on the Ministry of Health (MOH).

In 2006, as a result of requiring all private insurers’ CPF Shield plans to incorporate MediShield, the number of MediShield policyholders grew from 1.26 million to 2.75 million in 1 year. Its loss ratio was only 53 per cent ($67 million paid out over $126 million premium collected in the first 10 months of 2006).

In this connection, MediShield’s loss and expense ratio improved to 40 per cent ($119 million claims and expenses over $297 million collection), according to CPF Board’s 2006 annual report. (CPF)

In my letter “Cap co-insurance so Class C patients pay less” (ST, Feb 11, 2005), I asked: “Now that MediShield Plus will be hived off to a private insurer, will the surplus accumulated be transferred to MediShield and, if so, what is the estimated amount?”

I also asked the question again 3 months later, in my letter “Hello, Anybody listening?” (BT, May 25, 2005).

If the surplus from MediShield Plus was say $500 million[1], the combined surplus for both MediShield and MediShield Plus may now be about $1.4 billion. (Medishield surplus is over $900 million.)

Medishield – most profitable in the world?

To the best of my knowledge, MediShield may be one of the most profitable medical insurance schemes in the world, even by private insurers’ benchmarks, which generally operate with a claims and expense ratio of about 80 to 90 per cent – compared to Medishield’s 40 per cent, as explained above.

In contrast to most other countries’ national health schemes, which generally operate with a deficit, funded through the Budget, and a “pay as you go” basis, Singapore’s is probably the exception, in accumulating increasing surpluses.

Whilst policyholders getting older are expected to have more claims, we should also take into consideration that premiums increase with age, and the pool of insureds keeps increasing, especially with the inclusion this year of all new-born children.

The ad-hoc top-ups to Medisave accounts may be consumed by increasing premiums, which despite warnings of possible deficits, have always resulted in increasing surpluses, whenever premiums are raised to enhance coverage.

I would like to suggest that the MOH’s actuarial projections be made public, together with a year-to-year accounting of loss and expense ratios, surpluses, and accumulated surpluses, so that the question of how much surpluses is enough may be studied and reviewed on an on-going basis.

Higher healthcare costs but subsidies remain at same level?

According to the Ministry of Health’s (MOH) web site, MOH has been absorbing GST in full for all subsidised patients in public hospitals and polyclinics since 1994. For example, in 2005, when the GST rate was 5 per cent, the Government paid for the full GST at a total of $28 million. Last year, when GST was raised to 7 per cent, government subsidies to offset GST increased to $39 million, continuing to benefit subsidised patients.

Do the above statistics mean that the amount of total subsidies was $560 million ($28m divided by 5 per cent) and $557 million ($39m divided by 7 per cent), in 2005 and 2007, respectively?

As I understand that hospital admissions, polyclinics, specialist outpatient clinics, A & E, attendances, and hospital occupancy rates, have all hit record highs, with significant increases from 2005 to 2007, why is it that the total subsidy amount appears to have remained about the same for 2005 and 2007- $560m and $557m respectively?

Have subsidies for subsidised patients increased in tandem with the increase in patients and higher healthcare costs?

GST contributed to healthcare inflation

In a letter to the Straits Times on January 31, 2008, both the Ministry of Health and the Ministry of Finance said:

“Subsidised patients do not bear any GST cost, as it is borne entirely by the Government. Hence, GST did not raise the cost of subsidised health-care services.”

I think this may not have adequately addressed the calls by members of parliament and members of the public, to exempt hospital fees, medicine and medical-related equipment from GST, because the bulk of healthcare spending is from non-subsidised, rather than subsidised services.

Therefore, the GST increase may have contributed to healthcare inflation hitting a high of 6.3 per cent in December, 2007.

If hospital fees were exempt from the GST, and MOH didn’t have to pay for the full GST at a total of $39 million in 2007, could some of this amount have been made available and even more subsidies given to needy patients?

With another $39 million, perhaps the two national health groups running the polyclinics wouldn’t have to announce recently that they have to start fund-raising activities to supplement some of the estimated $2.5 million required under the Medical Assistance Scheme, to enable needy patients who cannot afford to pay, to go to polyclinics, because Medifund cannot be used for polyclinics.

By the way, inflation has hit another high since 1982. According to the Department of Statistics’s (DOS) latest Consumer Price Index (CPI) report, Healthcare registered the second highest inflation of 7.4 % (housing was the highest at 9.9 %) among all items, for Jan – Feb 2008 over Jan – Feb 2007.

Inflation for the lowest 20 % of Households by income, was 1.3, 1.8 and 2.0 % for 2005, 2006 and 2007, respectively, compared to -0.1, 0.4 and 2.3 % for the highest 20 % income households.

With the implementation of Means Testing, Healthcare inflation for some may be even higher.

References:

(1) “MediShield’s financial status must be protected”, Straits Times, Feb 16, 2005

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Uniquely Singapore by Sze Hian features every Monday on TOC. 

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Indonesia

Miss Universe cuts ties with Indonesia chapter after harassment allegations

The Miss Universe Organization severs ties with Indonesia franchise due to harassment claims. Malaysia edition canceled.

Women allege body checks before pageant. Investigation launched. Safety prioritized.

Indonesia winner to compete in November finale. Height requirement controversy.

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WASHINGTON, UNITED STATES — The Miss Universe Organization has cut ties with its Indonesia franchise, it announced days after allegations of sexual harassment, and will cancel an upcoming Malaysia edition.

In the complaint, more than a half dozen women said all 30 finalists for Miss Universe Indonesia were unexpectedly asked to strip for a supposed body check for scars and cellulite two days before the pageant’s crowning ceremony in Jakarta.

Their lawyer said Tuesday that five of the women had their pictures taken.

“In light of what we have learned took place at Miss Universe Indonesia, it has become clear that this franchise has not lived up to our brand standards, ethics, or expectations,” the US-based Miss Universe Organization posted Saturday night on social media site X, formerly known as Twitter.

It said that it had “decided to terminate the relationship with its current franchise in Indonesia, PT Capella Swastika Karya, and its National Director, Poppy Capella.”

It thanked the contestants for their bravery in coming forward and added that “providing a safe place for women” was the organization’s priority.

Jakarta police spokesman Trunoyudo Wisnu Andiko said Tuesday that an investigation into the women’s complaint has been launched.

The Indonesia franchise also holds the license for Miss Universe Malaysia, where there will no longer be a competition this year, according to the New York-based parent organizer.

In a lengthy statement posted to Instagram, Indonesia franchise director Capella denied involvement in any body checks.

“I, as the National Director and as the owner of the Miss Universe Indonesia license, was not involved at all and have never known, ordered, requested or allowed anyone who played a role and participated in the process of organizing Miss Universe Indonesia 2023 to commit violence or sexual harassment through body checking,” she wrote.

She added that she is against “any form of violence or sexual harassment.”

The Jakarta competition was held from 29 July to 3 August to choose Indonesia’s representative to the 2023 Miss Universe contest, and was won by Fabienne Nicole Groeneveld.

Miss Universe said it would make arrangements for her to compete in the finale, scheduled for November in El Salvador.

This year’s Indonesia pageant also came under fire for announcing a “significant change in this (year’s) competition guidelines” with the elimination of its minimum height requirement after it had crowned a winner.

In its statement, the Miss Universe Organization said it wanted to “make it extremely clear that there are no measurements such as height, weight, or body dimensions required to join a Miss Universe pageant worldwide.”

— AFP

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Malaysia

A Perodua service centre in Kuantan, Malaysia went viral for its strict dress code, Perodua responds

A dress code for vehicle servicing? A Malaysian car brand’s service centre dress code signage has puzzled netizens, raising queries about the need for attire rules during a routine service.

The manufacturer responded with an official statement after a flurry of comments, seeking to clarify and apologize.

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MALAYSIA: A dress code signage positioned at a service centre belonging to a prominent Malaysian car brand has sparked bewilderment among Malaysian netizens, who question the necessity of adhering to attire guidelines for a simple vehicle servicing.

The signage explicitly delineates clothing items that are deemed unsuitable, including sleeveless tops, short skirts, abbreviated pants, and distressed jeans.

The car manufacturer swiftly found itself flooded with comments from both inquisitive and irked Malaysian netizens. This surge in online activity prompted the company to issue an official statement aimed at clarifying the situation and extending an apology.

In a post that gained significant traction on the social media platform, politician Quek Tai Seong of Pahang State, Malaysia, shared an image to Facebook on Monday (7 Aug).

The image showcased a dress code sign prominently displayed at a Perodua Service Centre in Kuantan. Within the post, Quek posed the question: “Is this dress code applicable nationwide, or is it specific to this branch?”

The signage reads, “All customers dealing with Perodua Service Kuantan 1, Semambu, are requested to dress modestly and appropriately.”

Adding visual clarity to these guidelines, the sign features illustrative graphics that explicitly outline clothing items deemed unacceptable, including sleeveless tops, short skirts, short pants, and ripped jeans.

Delineating the specifics of the dress code, the signage stipulates that male visitors are expected to don shirts accompanied by neckties, opt for long pants, and wear closed shoes.

Conversely, female visitors are advised to don long-sleeved shirts, full-length skirts, and closed-toe footwear.

Perodua’s dress code sparks online uproar

Following the rapid spread of the post, Perodua’s official Facebook page found itself inundated with comments from both intrigued and frustrated Malaysian netizens, all seeking clarifications about the newly surfaced dress code policy.

Amidst the flurry of comments, numerous incensed netizens posed pointed questions such as, “What is the rationale behind the introduction of such regulations by the management? We demand an explanation.”

Another netizen expressed their dissatisfaction, arguing against the necessity of the rule and urging Perodua to take inspiration from the practices of other 4S (Sales, Service, Spare Parts, and Survey) automotive dealerships.

A concerned Facebook user chimed in, advocating for a more lenient stance, asserting that attempting to dictate customers’ clothing choices might not be in the company’s best interest.

Someone also commented in an angry tone, “Oi what is this? Going there for car service, not interview or working, right.”

As the discourse unfolded, it became evident that while some inquiries carried genuine weight, others chose to inject humor into the situation, playfully remarking, “If I wanted to buy a Myvi, I should buy or rent a formal attire first.”

“I sell economy rice at a hawker centre, I have never worn a long sleeve shirt and a tie… I guess I will not buy a Perodua car then.”

“I guess they will not serve those who wear short pants.”

Perodua addresses dress code controversy

As reported by Chinese media outlet Sin Chew Daily News, the manager of Kuantan’s Perodua Service Centre had acknowledged that the images on the dress code signage were misleading.

In response, the manager divulged that discussions had transpired with the head office, leading to the prompt removal of the signage to prevent any further misconceptions.

The manager clarifies, “We do encourage visitors to adhere to the dress etiquette, but we won’t go to the extent of restricting their choice of attire.”

He also revealed that currently, no complaints have been directly received from the public.

However, feedback from certain customers was relayed through Perodua’s agents.

Perodua also released an official statement by chief operating officer JK Rozman Jaffar on Wednesday (9 Aug) regarding the dress code on their official Facebook page.

The statement stated the dress code etiquette is not aligned with their official guidelines and they are currently conducting an official investigation on the matter followed by corrective measures to avoid the same incident from happening.

Perodua also extends its apologies for any inconvenience caused.

 

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