Image/article credits: Straits Times dated 31 March 2023

 

Ministry of Manpower (MOM) is set to increase the medical insurance coverage for foreign workers, including domestic helpers, with an annual claim limit of at least $60,000, up from the current $15,000. The new requirement will take effect on 1 July 2023 (Stage 1) and will help employers cover larger bills and minimise their out-of-pocket expenses as medical costs rise.

Under the Employment of Foreign Manpower Act, employers are legally responsible for the cost of medical treatment for their migrant workers. As migrant workers do not enjoy medical subsidies and with medical costs expected to increase over time, the higher minimum coverage will provide employers greater peace of mind in paying for their workers’ medical expenses. Currently, more than 5% of foreign workers’ medical bills exceed the current coverage limit of $15,000, and this proportion is expected to rise.

Senior Minister of State for Manpower, Koh Poh Koon, revealed in Mar 2022 that an average of more than 1,000 employers face this issue each year. MOM estimates that more than 99% of bills for hospitalisation and surgical procedures will fall within the new coverage limit. The new rules will also require employers to co-pay 25% of claim amounts that go above the first $15,000.

Example:

Worker incurs $60,000 hospitalisation bill.

The employer will have to pay $11,250 which is 25% of $45,000 (after deducting $15,000).

The insurer will cover the other $48,750.

The new policy changes will be implemented in phases to give employers and insurers time to adjust to the cost impact. From 1 Jul 2025 (Stage 2), the following enhancements will be implemented:

  • Standardisation of allowable exclusion clauses
  • Introduction of age-differentiated premiums for workers below and above age 50
  • Requirement for insurers to reimburse hospitals directly upon the admissibility of the claim.

To help employers mitigate the impact of medical inflation and safeguard against their migrant worker’s medical liabilities, Allegiance works with reputable insurers to offer Foreign Worker Medical Insurance with various limits without co-payment, the highest limit being $100,000.