Careshield Life payouts to double from 2% to 4%, with Gov’t pledging additional $570M to subsidise higher premiums
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SINGAPORE: The government announced today (Aug 27) that it has accepted the CareShield Life Council’s recommendations from its 2025 review, which include higher payouts under the national long-term care insurance scheme and enhanced government support to ease the impact of premium increases.
The Ministry of Health (MOH) said in a press statement that the changes aim to ensure CareShield Life continues to support Singaporeans in meeting their basic long-term care needs should they develop severe disability. The enhancements will be rolled out progressively from January 2026.
As part of the review, the council recommended doubling the annual growth rate of CareShield Life payouts from 2% to 4%, while keeping eligibility criteria unchanged.
This means that by 2030, a policyholder making a claim will receive $806 a month, up from the $731 that would have been paid out under the previous growth rate.
The council noted that this adjustment takes into account rising long-term care costs driven by inflation, manpower, and technology needs, while ensuring premiums remain affordable.
To sustain higher payouts, premiums will increase. However, the council recommended measures to moderate the impact. First, underwriting criteria for older individuals born in 1979 and earlier will be reinstated, as originally planned.
When CareShield Life was first introduced, enrolment incentives and a grace period were extended to encourage participation, even for those with mild or moderate disability. With take-up rates having declined by 90% since 2021, the Council said reinstating criteria would keep the scheme fair and sustainable.
Second, transitional premium support will be introduced to phase in increases gradually. Annual premiums would have risen by an average of $126 in 2026, growing at 4% each year thereafter without these measures, according to MOH. With government support, increases will be moderated to about $38 a year on average between 2026 and 2030, and capped at $75.
Low- to middle-income Singaporeans will face even smaller increases due to means-tested subsidies. MOH stressed that all premiums will remain fully payable via MediSave, and no one will lose CareShield Life coverage due to an inability to pay.
To cushion policyholders, the government said it will provide more than $570 million in additional premium support over the next five years. This includes $440 million in broad-based transitional support for all affected policyholders, more than $130 million in means-tested support for lower- and middle-income households, and an expansion of the Additional Premium Support scheme for those unable to afford premiums even after subsidies.
The council also recommended that the government improve the claims process.
From 2026, individuals assessed for severe disability under CareShield Life will also be automatically assessed for related schemes such as the Home Caregiving Grant, reducing the need for multiple applications. The government said it will continue to look for ways to ease the administrative burden on care recipients and their families.
In accepting the recommendations, MOH said the review struck “an appropriate balance” between providing greater protection for Singaporeans with severe disability and keeping premiums affordable. The enhanced payouts and premium framework will apply from 2026 to 2030, after which another review will be conducted to ensure the scheme remains meaningful and sustainable.