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The rising cost of long-term care: what you need to know

The rising cost of long-term care: what you need to know

  • 07 October 2023
  • By OCBC Wealth Advisory
  • 10 mins read

If you are worried about job loss due to an illness or disability, you are not alone. In Singapore, two-thirds of the workforce share your sentiment but less than half choose to take action1.

Unfortunately, widespread misconceptions, like the idea that disability insurance is expensive and convoluted have led many to put disability coverage on hold or not consider it altogether.

There are instances where individuals are unable to practice their previous profession that requires specific skills – chefs, surgeons or athletes – due to an illness or disability. For example, a surgeon suffering from Parkinson’s Disease will not be able to perform an operation with shaky hands.

People with disabilities or chronic illnesses may encounter additional barriers in their search for new employment2 which makes it even more challenging for them. Without a steady income, paying for the necessary medical and living expenses can become a financial burden to their loved ones.

The popular perception is that disabilities mainly affect the elderly and those in high-risk occupations or those who work in hazardous environments. However, this is far from the truth. Disability can happen to anyone at any time.

Young people3 may experience mild to moderate disabilities due to trauma, a stroke or an accident which may leave them unable to take care of themselves.

Figure 1: Disability increases the need for long-term care and medical treatment as people with disabilities are more likely to have a moderate to severe disability and chronic illness.

of Singaporeans aged 7 to 18 have a disability
of Singaporeans aged 18 to 49 have a disability
of Singaporeans aged 50 and above have a disability
of Singaporeans have more than one disability type
of Singaporeans have a moderate to severe disability
have a chronic disease (e.g. heart disease, diabetes, stroke and asthma)
have a mental health condition

Source: Understanding the quality of life of adults with disabilities, National Council of Social Service (as of 31 January 2023).

Depending on the severity of the disability, some people may need long-term care4. Patients with disabilities may require sophisticated medical needs, assistance with daily life activities, specialised equipment, therapies and services.

Long-term care can be quite expensive and often not fully covered by health insurance. Singaporeans can expect to spend at least S$2,000 per month5 for basic long-term care, including medical escort and transport, home therapy, home personal care and an untrained domestic helper.

Aside from the financial burden, many family members often find themselves having to take time off from work to provide care for their loved one. It can be physically and emotionally exhausting for the caregiver when it is done over an extended period.

Family members may eventually turn to engaging a trained helper, nurse or nursing care services. A nursing home in Singapore will typically cost between S$2,000 and S$3,6006 per month. Even the most financially prepared family may find it difficult to provide long-term care for their loved one due to the significant financial burden and the struggle to figure out how to meet their loved one’s needs.

Figure 2: The cost of long-term care services can add up to be a significant expense.

  • Cost
Includes Cost  
Type of service
Home care
Day care
Stay-in care
Includes Cost  
  • Meals on wheels
  • Home medical
  • Home therapy
  • Home nursing
  • Home personal care
  • Hospice home care
  • Medical escort and transport
  • From S$4.90 per meal
  • From S$180 per visit
  • From S$125 per visit
  • From S$80 per visit
  • About S$24.50 per hour
  • From S$100 per visit
  • From S$40 per round trip
  • Community rehabilitation centre
  • From S$70 per rehabilitation session
  • Community hospital
  • Nursing home
  • From S$1,200 per month

Source: Care Services, Agency for Integrated Care (retrieved on 31 January 2023)

Fortunately, the Singapore government’s CareShield Life can address some of the long-term care concerns for Singaporeans and Permanent Residents.

CareShield Life is a compulsory national long-term care insurance scheme which provides basic financial support. People who become severely disabled4 will receive a monthly payout starting at S$600 per month and increasing at 2% per year7. If an individual is unable to perform at least three Activities of Daily Living (ADL), it can help to defray some of the costs associated with long-term care.

Figure 3: Being unable to perform any of these Activities of Daily Living (ADLs) can significantly affect one’s quality of life

  • Dressing
  • Feeding
  • Toileting
  • Walking or Moving Around
  • Transferring
Washing The ability to wash in the bath or shower (including getting into and out of the bath or shower) or do a sponge/bed bath.
Dressing The ability to put on, take off, secure and unfasten all garments and as appropriate, any braces, artificial limbs or other surgical or medical appliances.
Feeding The ability to feed oneself food after it has been prepared and made available.
Toileting The ability to use the toilet or manage bowel and bladder function through the use of protective undergarments such as diapers or surgical appliances if appropriate.
Walking or Moving Around The ability to move indoors from room to room on level surfaces.
Transferring The ability to move from a bed to upright chair or wheelchair, and vice versa.
Walking or Moving Around

Source: Are you 30-40? Know all about CareShield Life, Central Provident Fund (retrieved on 31 January 2023).

Due to an ageing population, medical advancements and increasing operating costs, healthcare costs in Singapore have been rising annually. This implies that you should prepare yourself in advance for any unfortunate events.

Having an adequate insurance coverage is important as it can help you to continue to meet your financial goals and maintain your financial wellness. Most importantly, it gives you and your family a peace of mind should the unthinkable happens. To fill the financial gaps, you can consider upgrading your CareShield Life coverage with private plans that can enhance your benefits or offer caregiver benefits.

Discover more articles about financial planning for all ages.

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