Should you downgrade your AIA Healthshield Gold Max or Essential rider?

If you have AIA Healthshield Gold Max Plan A as your integrated shield plan (IPS) with the AIA Max Essential A rider, the question to downgrade to save some premium must have been on your mind.

When the premium notice came in with the new premium rates, “Not higher premiums again!” must have pop up in your head.

You are not alone.

In the early years before the Medishield is revamped into Medishield Life in 2015 premiums were more affordable.

After a one year premium freeze imposed onto insurers, ALL the integrated shield plans offered (including that of AIA) started to increase their premium like clockwork! (shown below).

AIA has raised the AIA Healthshield Gold Max by 2-23% and in Jul 2017. The rider premium was increased by 18-54%. In Jul 2018, AIA raised the main plan again by another 9-25%.

Do you know how much you are really paying?

If you are currently in your 30s, you will be paying $861 to $1,125 yearly for the Healthshield gold max plan A and Essential A rider. Of this amount, the cash outlay is $640 to $839 after the medisave component.

If you are above age 40, you will need to top up with cash for the main plan alone. The rider can only be paid using cash from your own pocket.

You may want to use our Singapore first Integrated Shield Plan Premium Calculator to know how much you are paying per year!>>

As your age increases, so does your premium.

And premium must be paid every year for your coverage to be around.

Did you know that if you are age 35 in 2018, you are looking at paying $169,930 in total by the age of 75!

That amount alone can be used to pay for your down payment for a 1 bedroom condo!

By the way, did I say this is only based on the current premium in 2018 and it has not even including future inflation!

Do you want coverage to private hospitals?

If you do, you have to keep your AIA Healthshield Gold Max A.

This plan gives you up to $2m in yearly limit and up to 13months in pre/post coverage which is the highest in the industry!

Downgrading to Healthshield Gold Max B will reduce your yearly limit and is not a suitable for private hospital coverage. 

But there's another way to reduce your total premums. 

That is downgrade your rider to the AIA Max Essential A saver!

I've suggested it to friends who use the AIA medical plan. The coverage kind-of restricts you more to the AIA Quality Healthcare partner (AQHP) route.

The AIA Max Essential A Saver is at a fraction of the cost of 50% lesser as compared to its sibling the AIA Max Essential. The KEY difference is that you will need to pay for the deductible if the private doctor who is treating you is not on the AIA Quality Healthcare partner (AQHP).

What exactly is AIA Quality Healthcare partner (AQHP)

It is AIA's network of more than 180 private medical specialists across 26 medical disciplines.

You will need to request for a specialist appointment in 3 working days

Click here to find out more

In this system, AIA offers you a Payment-free hospital stay with their surgical bill pre-approval.

Question: What if I choose a private doctor that is not in the AIA Quality Healthcare partner (AQHP)?

In this context, the deductible of $3,500 will not be covered. What this means is that you must foot the first $3,500 of the bill and any bill less than $3,500 will have no reimbursements.

The diagram below explains how it works.

How much are you saving if you switch to AIA Essential A Saver?

If you are age 35, you will pay $585 for AIA Essential A Saver instead $1,125 for the more expensive AIA Essential A. That’s a whopping 48% saving!

The AIA's policy yearly limit and pre/post hospital benefits are the best when you are in the AIA Quality Healthcare partner (AQHP) system. There is quite a lot of benefits to lose by seeking a private doctor outside of this panel.

But if you really need to, this $3,500 deductible that will not be covered can likely be paid using your Medisave.

Furthermore, you don’t admit into the hospital every year (I hope not!). I have a different way to look at it. With the yearly savings of say $540, it can make up for that $3,500 deductible in just 6-7 years. Why stick to the Max A rider?

Question: If I downgrade rider, will I be subjected to the new MOH 5% co-payment?

No. A downgrade is not a new plan application. You can still get 100% of the bill covered.

Check here for the latest brochure.

In summary,

AIA Max Essential A Saver rider is a very good alternative to AIA Max Essential A and can save you considerable premium. 

For new applicants, a new variation of the Essential A Saver should be created soon to factor in the 5% co-payment but it is not out yet.


CLICK HERE TO CHECK ON AIA VITALITY

Last updated on December 25th, 2018 at 03:27 pm

The Financial Advocate

I am always fascinated in how parents approach financial issues in their daily lives. There is an overwhelming amount of information available and through this blog, I hope I can shed some light on financial matters concerning parents!

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