‘Local private hospital sector in a healthy state’

But what about the state of healthcare for ordinary Malaysians?

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A long queue waiting at the crowded Penang General Hospital - ANIL NETTO/FILE PHOTO

That was the subtitle of an article in StarBiz on 25 June 2021 that analysed GIC Pte Ltd’s RM750m purchase of a 16% stake in Sunway Healthcare.  

This article drew attention to Sunway Healthcare’s high implied enterprise value to earnings before interest, taxes, depreciation and amortisation (EV/EBITDA) ratio of 31.33 (compared to 19.08 for IHH).

The article attributes the high premium in the enterprise valuation to the strategic expansion plan that Sunway Healthcare announced recently. The plan is to build six new hospitals to increase bed capacity from 856 currently to 2,560. 

However, glaringly absent in this otherwise well-researched article was any analysis of the impact of the expansion of private hospital capacity on healthcare for ordinary Malaysians.

Most ordinary Malaysians have to depend on government hospitals if they develop a serious health problem.

Unfortunately, government hospitals, which now handle about 75% of in-patients in the country, are short of experienced specialists. Over 75% of doctors aged below 60 with at least 10 years’ experience as specialists are in the private sector.

The remaining 25% have their hands full taking care of the heavy patient load in the government sector, training house-doctors and specialist trainees, and handling the administrative duties of large departments.    

Our deployment of medical personnel in the country leaves much to be desired. First, we have a two-tier system of healthcare where there are delays in the treatment of patients with serious health issues in government hospitals. And second, the imparting of knowledge and experience to the younger generation of doctors is markedly impaired because 75% of the experienced specialists are not in contact with the young doctors in government service.

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The Socialist Party of Malaysia (PSM) has suggested several measures to stem the brain drain of doctors and paramedical staff to the private sector. The government should:

  • set up a separate service commission for medical staff and use the salary scale of the National Health Institute (IJN) as a template to develop better terms of renumeration for government health staff
  • borrow the concept of sabbaticals from universities and offer government specialists paid sabbaticals of three to six months every five years of specialist service. Specialists could use these sabbaticals to learn new techniques and procedures, thus enhancing the quality of medical services in the country
  • institute a moratorium on new private hospitals for the time being. New private hospitals worsen the brain drain by recruiting specialists and competent paramedical staff (eg operation theatre technicians, intensive care unit nurses and midwives) from the government sector. The depleted government sector is already buckling from the work pressure
  • increase the health allocation from the current 2.1% of gross domestic product (GDP) to 4% so that the government can build more government hospitals, employ more healthcare staff and implement a better pay scheme

Sadly, however, the political elite in this country seem to be unable to view the healthcare system holistically. They seem oblivious to the fact that the over-rapid development of the private sector undermines the public hospitals. This inability to view the healthcare system as interconnected has been true of both the Pakatan Harapan and Barisan Nasional governments.

“Kita jaga kita” (we’ve got each other’s back) is a lovely slogan. But it is of no help if it only remains a slogan. The Covid pandemic has affected Malaysians to varying degrees.

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The richest 10-20% of the population have actually seen an increase in their wealth as share prices rose over the past 18 months.

Workers in the formal private sector have been cushioned by wage subsidy schemes. Despite that, many of them have had to draw down their EPF savings markedly, leaving them vulnerable to financial insecurities in their later years.

The bottom 30% who are in the informal sector have fared the worst. Many of them have suffered a collapse in incomes, and they even have had to reduce food consumption after depleting whatever little savings they might have had.    

“Building back better” (another lovely slogan) would require that we implement measures that provide better support for those most adversely hit by the pandemic and lockdowns.

One thing we should do is to strengthen the government healthcare system which ordinary Malaysians depend on. To do that, we have to base our decisions regarding healthcare development in Malaysia on a proper understanding of the interconnections between the public and the private sectors.    

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