MediSave is the part of CPF set aside for healthcare. It pays your hospital bills, your MediShield Life premiums and a growing list of approved treatments — and it earns one of the highest interest rates in CPF, around 4% a year. The rule that surprises most people is the Basic Healthcare Sum: a yearly ceiling on how much MediSave can hold. Here is what MediSave covers, how the cap works, and where your money goes once it is full.
🏥 What MediSave can pay for
MediSave is for medical costs — your own and your immediate family’s. You can use it for hospital stays and day surgery, for your MediShield Life premiums and the MediSave-eligible portion of an Integrated Shield Plan, and for a range of approved outpatient treatments such as chronic-disease management, certain scans and recommended vaccinations. There are withdrawal limits for each type of treatment, by design — they keep MediSave lasting across your whole life rather than being drained by a single big bill.
💧 How it’s funded — and why ~4% matters
Part of every CPF contribution flows into MediSave, with a larger share directed there as you get older. The balance earns the same floor as the Special and Retirement Accounts — around 4% a year — plus the extra 1% CPF pays on the first $60,000 of your combined balances. That is well above the 2.5% your Ordinary Account earns, so money sitting in MediSave compounds at a healthy, risk-free rate while it waits to be needed. You can see how much of each contribution goes to MediSave at your age with the CPF contribution calculator.
🧱 The Basic Healthcare Sum (the cap)
MediSave is not unlimited. The Basic Healthcare Sum (BHS) is the most you can hold in the account — currently about $75,500, and raised at the start of each year to keep pace with healthcare costs. Once you turn 65, your BHS is fixed for the rest of your life at that year’s level. The aim is to make sure you set aside enough for healthcare in old age without locking away more than you need. (CPF publishes the exact BHS each January.)
🔁 What happens when MediSave is full
Hitting the BHS does not mean you lose contributions. Once MediSave is at the cap, any CPF that would have topped it up instead flows into your Special Account — or your Retirement Account if you are 55 or older — and, once that is at its limit too, into your Ordinary Account. So the money simply lands in another account, often one you can use more flexibly, rather than disappearing. For how OA, SA, MA and RA fit together, see CPF for beginners.
📊 A worked example
Suppose your MediSave reaches the $75,500 cap in March. For the rest of that year, the slice of your CPF contributions that would have gone to MediSave is redirected — to your Special or Retirement Account at ~4%, or your Ordinary Account at 2.5% if the others are full. You pay exactly the same total CPF; only the destination changes.
Meanwhile your full balance keeps earning interest: a $75,500 MediSave balance earns roughly $3,000 a year at ~4%. That interest can lift the balance above the cap, and that is allowed — it is only fresh contributions that overflow once you are at the BHS.
🧭 Putting it to use
You do not manage MediSave actively, but knowing the cap helps you plan: once you are near the BHS, extra CPF naturally strengthens your retirement accounts instead. To see how much of each contribution goes to MediSave at your age, try the CPF contribution calculator, and for the bigger picture run a Retirement Projection. New to CPF? Start with CPF for beginners.