You will be able to describe what CareShield Life and the national safety nets cover and what they leave to you.
Most people can picture a hospital stay: a few days in a ward, a bill, an insurance claim. Fewer picture the other kind of health cost, the one that does not end with a discharge. A parent who can no longer bathe or dress without help. A stroke that leaves someone needing a caregiver every day for years. If you have watched a family go through that, you know the costs are not one bill but a monthly outflow with no end date.
Lesson 7.2, Premiums rise with age, dealt with hospital insurance. This lesson covers long-term care, what the national schemes do about it, and what they leave to you.
CareShield Life is the national long-term care insurance scheme. It pays a monthly cash benefit to people who become severely disabled, generally meaning they cannot perform a set number of basic daily activities, such as washing, dressing or moving around, without help. The benefit continues for as long as the severe disability lasts, including for life.
Whether you are covered depends mainly on when you were born and your residency. Many younger Singapore Citizens and Permanent Residents are covered automatically, while older cohorts may have had the choice to join. Premiums can be paid from MediSave. The current eligibility rules, the definition of severe disability, the premium and the size of the monthly benefit are all on the CareShield Life website. Look up your own position rather than assuming.
For your plan, two facts matter. First, CareShield Life premiums are payable over a set period, and like other premiums they are a cost to include. Second, the benefit is a fixed monthly sum, not a promise to pay whatever care costs.
The scheme is designed to help with the cost of care, not to cover it fully. Care at home with a helper or a part-time caregiver, day care, or a place in a nursing home can each cost much more than the monthly benefit, depending on the level of care and where you receive it.
So a gap may remain, and it can last for years. A plan that assumes the benefit takes care of everything is likely to be short exactly when the household can least afford a surprise.
What fills the gap varies. For some people it is savings, which is one more reason to keep a margin in the long-term part of your number. Some buy private supplements to CareShield Life. Some rely on family. The right mix depends on your health, your family and what you would want, and the detail of supplements and long-term care planning sits in Insurance Decoded and Retirement & Estate.
Singapore has safety nets for people who cannot pay for care. MediFund is an endowment fund that helps needy patients with medical bills they cannot afford after subsidies, insurance and MediSave. Government subsidies for long-term care services are means-tested, so households with lower income and fewer assets receive more support.
These matter, and nobody should be ashamed to use them if they need to. But planning to rely on them is a different thing. Means-tested help is designed for people with limited resources, so someone with a financial independence portfolio may receive little of it. And relying on a safety net limits your choices: of provider, of setting, of whether you stay at home.
The question for your plan is not whether help exists. It is what you would do yourself, with your own resources, if you needed care.
Priya, 34, from the earlier modules, checks the CareShield Life website and finds that, given her age and citizenship, she is covered. She notes that its premiums come out of her MediSave for a set number of years.
Then she answers the harder question with made-up figures. If she needed long-term care at 70, she would want to stay in her flat with a part-time caregiver. The CareShield Life benefit would cover part of the cost. The rest would come from her portfolio, which by then only has to fill the gap above CPF LIFE. She decides to treat a care need as a reason to stop all flexible spending, which in her base is S$15,500 a year at today's prices, and to draw on the margin in her long-term figure if that is not enough.
She also writes a question for later: whether a private supplement is worth its premium for her. That belongs with an adviser and with Insurance Decoded rather than in this course.
Her answer is not perfect, but it is written down, and it connects the risk to a specific part of her plan.
Before the activity, look up your own CareShield Life status. Then think about the situation it describes honestly, because the activity asks what you would actually do.
Write down whether you are covered by CareShield Life and what you would do if you needed long-term care at 70.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).