Article Search By: Pn. Marziati Md Din

Source : Berita Harian

 

 

The issue of medical insurance premium increases has become a hot topic plaguing Malaysians lately, especially following the interim measures announced by Bank Negara Malaysia (BNM) recently.

BNM's interim measures are a good start, but can only provide temporary relief to medical insurance policy holders. High prices of medical services in private hospitals and lack of transparency in medical charges continue to be a 'thorn in the flesh' for consumers.

This requires immediate and comprehensive 'surgery', particularly by the Ministry of Health (MOH). The data presented by BNM paint a rather worrying picture.

Medical cost inflation in Malaysia has recorded a double-digit rate for many years with an average of 15 percent per year. This rate is far above the global average of around 10 percent and Asia-Pacific (11 percent).

Since 2018, a significant increase in medical costs has been recorded and this trend is expected to continue in the coming year. The question is, why are medical costs in Malaysia so much higher than in other countries?

Is there an operational cost factor, medical technology, or is there an element of excessive profiteering imposed by certain parties? In addition to medical cost inflation, increased use of medical services, especially after the COVID-19 pandemic also contributed to the increase in costs.

Data shows an increase in the use of medical services, for example the number of health insurance and takaful claims increased from seven people for every 100 policies in 2020 to nine people today. This higher frequency of claims has put pressure on insurance and takaful companies to adjust premiums to ensure they are able to cover claims.

However, is this increase due to health awareness increasing among the community or are there other factors contributing to this increase, such as an increase in chronic diseases or environmental factors?

Among the biggest issues causing concern among consumers is the lack of transparency in medical charges in private hospitals.

Studies have shown a large difference between patients' bills using an insurance guaranty letter (GL) and those they pay themselves. For example, the cost of dengue treatment for a patient with GL is around RM4,978, while a patient without GL is only RM1,288.

This difference clearly shows the existence of unethical price discrimination practices. Transparency in medical charges is a fundamental right of patients and private hospitals should be held accountable to provide clear and understandable charge details.

In addition, there are complaints that private hospitals often charge high fees for essential items, for example rubber gloves or other medical equipment.

This component accounts for around 59 to 70 percent of the total medical bill, thereby burdening patients and increasing insurance premium rates.

Do these charges really reflect the true cost or is there an element of excessive mark-up? Transparency in every aspect of medical charges is important to build trust between patients and healthcare providers.

 

Not solve the core problem

 

As the regulator of insurance and takaful companies, BNM introduced interim measures to control premium increases. These measures include repricing medical and health insurance products to remain competitive.

However, this move is solely aimed at ensuring that insurance companies are able to cover the cost of claims, not to increase their profits. While this move provides some relief to consumers, it does not solve the core problem causing premium hikes.

A long-term solution requires the active involvement of the Ministry of Health in revamping the country's healthcare system. Among the initiatives started is the diagnosis-related payment model (DRG), which aims to control the cost of treatment through standard pricing based on diagnosis.

This step is important to ensure that private hospital charges are more transparent and affordable. However, the implementation of DRG needs to be expanded and strengthened so that its impact can be felt by all levels of society.

The Ministry of Health should also consider introducing new regulations to regulate components of hospital charges, including laboratory tests, scans and the use of medical equipment.

The lack of strict regulation only opens up space for arbitrary pricing practices by private hospitals. Legal amendments are needed to give the Ministry of Health the power to regulate the price of hospital services and supplies more comprehensively.

A solution to this issue requires close cooperation between all stakeholders, including private hospitals, government and insurance companies.

Private hospitals need to play an active role by supporting the implementation of DRGs and increasing transparency in the publication of treatment costs. The government can consider bulk purchases to reduce the cost of medical supplies and create a special fund to cover medical costs for the needy.

Insurance companies also need to be more proactive in offering innovative and affordable insurance products and improve operational efficiency to reduce overhead costs.

It is well known that the current law does not allow the Ministry of Health to regulate hospital charges, except for doctor consultation services. This is a weakness that needs to be addressed immediately. A legal amendment is needed to give additional powers to the Ministry of Health to regulate private hospital charges.

With this power, the Ministry of Health can set fair benchmarks for hospital charges, thereby facilitating enforcement and protecting consumer rights. A long-term solution requires a comprehensive approach involving the Ministry of Health, private hospitals and insurance companies.

Efforts to increase transparency, control medical costs and introduce new regulations are critical steps towards addressing this issue. Without a solution to the real cause of the problem, the increase in insurance premiums will continue to burden the people.

Therefore, all parties need to commit to finding a holistic and effective solution to ensure that the medical insurance system in Malaysia remains sustainable and affordable for all.

Date of Input: 27/12/2024 | Updated: 27/12/2024 | muhammad.isam