You will be able to explain when your MediSave can pay for a family member's healthcare or premiums.
After her mother's fall, Linda paid the MediSave part of the bill from her own account. It felt like the obvious thing to do. Her mother's MediSave was low, Linda's was full, and the hospital form had a box for a family member's account. Only later did she wonder how often she would be ticking that box over the next ten years, and why her brother had never been asked.
Your MediSave can help pay for your family's healthcare. That is one of its most useful features, and also one of the easiest ways to empty it without noticing.
MediSave can pay approved medical bills for your immediate family members. That generally includes your spouse, your children, your parents and your grandparents, and the rules set out which other relatives qualify and under what conditions. The same withdrawal limits from lesson 5.1, What MediSave pays for, and the withdrawal limits, apply whichever account pays.
It can also pay some insurance premiums for family members, such as MediShield Life and the MediSave-payable part of an Integrated Shield plan, again within the yearly limits. The list of eligible family members can differ between bills and premiums, so check the specific use on the CPF Board website before you rely on it.
When a family member is admitted to hospital, the hospital's financial counsellor can tell you which accounts can be used and in what order. Usually the patient's own MediSave is used first, then a family member's if they agree.
Every dollar you spend from your MediSave on someone else is a dollar not there for your own later needs. While you work, contributions refill the account, so the cost can feel invisible. In your sixties and beyond, when contributions stop and your own premiums rise, the money you spent earlier is money your account no longer has.
With made-up figures, here is what Linda's commitment could look like. If she pays S$1,200 a year of her mother's premiums and about S$1,000 a year of bills from her MediSave, that is S$2,200 a year. Over ten years it adds up to S$22,000. If that money had stayed in her MediSave earning an example rate of 5%, not the current rate, it would have grown to about S$27,671.36. That is the real size of her ten-year gift to her mother's healthcare.
Linda's MediSave is at the Basic Healthcare Sum, so in practice the payments switch off part of her overflow, as lesson 1.3 described. Each dollar spent on her mother is refilled by a contribution that would otherwise have gone to her Special Account. The cost lands on her retirement savings rather than her MediSave balance, but it lands all the same.
None of this means Linda shouldn't help. It means she should know the number and choose it, rather than discover it.
In many families, a parent's healthcare falls on whoever is nearest, earns the most or answers the phone first. With MediSave, it often falls on whoever has the fullest account. That can be fair, but it is rarely discussed, and resentment builds when one sibling's retirement savings quietly carry a parent's costs for years.
A short conversation early helps. Before a parent's needs grow, agree among siblings who pays which premiums and how bills will be split, whether from MediSave or cash. Write it down in a message everyone has seen. Agree to review it if a parent's health changes or someone's circumstances do. If one sibling's MediSave carries more, others might cover more of the cash part, or top up that sibling's account, or their parent's.
Linda spoke to her brother. They agreed that she would keep paying their mother's premiums from her MediSave, and he would pay the cash part of any hospital bill and their mother's rider. They also agreed that if their mother needed long-term care, they would sit down again before anyone paid anything.
Think about who might draw on your MediSave in the next ten years. For people in their thirties, it is often a spouse and young children, whose bills are usually smaller and partly covered by their own accounts. For people in their forties and fifties, it is often parents, whose needs tend to be larger and longer. Some people face both at once.
List the family members who might need your MediSave over the next ten years. For each, estimate roughly how much it might pay each year, for premiums and for bills, so you have figures to carry into your yearly MediSave list in lesson 5.4.
Write which family members might draw on your MediSave in the next ten years and roughly how much.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).