Deliberately excluding elderly above the age of 49, Health Minister Gan Kim Yong demanded that old people would have to opt in and pay “premiums of more than S$1,000 for 10 years” if they want CareShield Life. The S$1.1 million-a-year PAP minister also suggested that those who are poor may choose not to participate:
“Older people who want to join CareShield Life might have to pay premiums of more than $1,000 a year for 10 years. This is before government incentives and premium subsidies kick in… People aged 39 to 48 now who are on ElderShield400 in 2021 will automatically be switched to CareShield Life. They have two years to opt out with no penalty. Older people and those not on ElderShield have to opt in if they want CareShield Life coverage… For some, the incentives and subsidies will be meaningful and helpful, but older people may find it very difficult to participate. It is important for them to take into account their own financial resources and their care needs.”
Despite clearly excluding the elderly poor, PAP MP Chia Shi Lu weighed in on CareShield claiming that the premiums are “affordable for many”:
“Given the many incentives, subsidies and premium support, it would still be affordable for many in the older group.”
Most Singaporean elderly work in low income employment like cleaners, taking home less than S$900 a month after CPF tax deductions. This particular group that most needed the CareShield Life however will have to pay cash, at an estimated S$50 a month after subsidies, for the insurance. This payment excludes MediShield Life, CPF Annuity and indirect taxes.
The new disability insurance is mandatory for Singaporeans from age 30 to 48, and has been previously proven to be hugely profitable for the Singapore government. As of 2017, S$3.3 billion of premiums were collected and only S$133 million was disbursed. Singapore’s sovereign wealth fund companies, Temasek Holdings and GIC, manage the excess S$3 billion in insurance funds along with the national reserves and CPF funds. Managed by Prime Minister Lee Hsien Loong and his wife Ho Ching, who sat as GIC’s Chairman and Temasek Holdings’ CEO respectively, the companies profit by earning the excess above the coupon rate payable under special government bonds.
Although the government kept selling that the payout is higher, the premiums of CareShield Life is also 81% more expensive when compared to ElderShield. A 40 year old man will pay S$275 a year in premiums under CareShield Life, as compared to S$151.67 a year under ElderShield.