KUALA LUMPUR — Recouping losses after paying compensation awards granted by courts to victims of medical negligence cases is believed to be among factors driving the increase in private healthcare charges, a PKR lawmaker said.
Bayan Baru MP Sim Tze Tzin said this was based on feedback from several medical experts who have extensive experience in private hospitals that he and some MPs are engaging to uncover the reasons related to the spike in medical insurance premiums.
Besides hefty payouts for compensation charges medical negligence cases, the experts also cited a high number of “unnecessary admissions” into private hospitals, which also “overdid procedures”.
Sim did not name the experts spoken to but said they were also of the view that private hospitals also conducted unnecessary scans and screenings.
“There were also redundant MRI (magnetic resonance imaging), CT (computed tomography) and PET (positron emission tomography) scans and screenings (conducted by private healthcare institutes).
“(The experts also said that) private hospitals are seeking to increase their profits,” the government backbencher told a press conference in Parliament today.
He said over the past two weeks, PKR representatives had received 197 complaints from the public on high private hospital charges.
While Sim acknowledged that private hospitals are operated by profit-seeking companies, he highlighted that such institutions had recorded very encouraging profits in recent years.
For example, he said that KPJ Healthcare Group, which has 29 private hospitals in Malaysia as well as one each in Bangladesh and Thailand, recorded a gross profit of 39.6% in 2019, with the figure growing to 41.9% last year.
While the group’s profits after tax were 8.6% in 2019, they managed to garner 7.9% in 2023.
IHH Healthcare Group, which has 18 hospitals locally, saw its profits after tax and minority interests increase drastically from 2.1% in 2020 to 14.1% last year.
Sim added that since lawmakers are not equipped with sufficient data or expertise, they cannot say for sure whether or not the profits generated by private hospitals here are closely linked with various complaints received on inflated medical premiums.
As such, he urged the Health Ministry and Bank Negara Malaysia (BNM) to form a joint taskforce comprising medical experts, actuarial scientists, public health policy experts and other relevant professionals.
The taskforce, he said, should investigate as well as determine policies and solutions that can benefit private hospitals, insurance companies and the rakyat.
“We also request that an independent body such as Parliament’s Public Accounts Committee conduct proceedings and a public hearing to investigate the reality of the situation,” he said.
“Our intention is not to find fault with any party or restrict profits gained by the private healthcare sector.
Instead, our goal is to urge the government to find solutions for the private healthcare ecosystem and sustainable private health financing so that the sector can develop healthily and sustainably,” he added.
He also disclosed that BNM will be briefing government backbenchers tomorrow on the recent hike in medical insurance premiums, saying: “Every time insurance companies have a (premium) price hike, they need to get approval from BNM.
“We want to understand how BNM makes such approvals and what criteria are considered.”
Sim had previously urged Bank Negara to investigate and review insurance companies that have issued notices of premium hikes ranging from 40% to 70% for the coming year.
He was responding to reports of the anticipated premium hikes, as stated in notices sent to consumers. The increases are attributed to rising medical costs in private hospitals. – December 9, 2024
