Making people pay for their own healthcare by taking health insurance will further increase the disparity in access to healthcare and erode social solidarity, says Jeyakumar Devaraj.
PSM is quite perturbed by the deputy health minister’s announcement on 5 August that the Pakatan Harapan government is thinking of rolling out a new health insurance scheme to help meet the costs of providing healthcare to the Malaysian population.
Dr Lee Boon Chye was quoted (MalayMail) as saying, “We are thinking of minimum coverage of between RM10,000 and RM20,000 per family per year.”
“For those who feel that the coverage isn’t enough, they can still top up on their own or even buy private health insurance.”
PSM feels that this is the wrong way to go about addressing rising healthcare costs. The requirement to set aside money to buy health insurance will be an additional strain on B40 families, who are already struggling to make ends meet.
According to comparehero.my and theedgemarkets.com, 20% of Malaysian families had household incomes of less than RM3,000 in October 2016, while another 20% had household incomes of between RM3,000 and RM3,900 per month. These families would find the additional RM100-RM200 that they would require to put aside each month for health insurance a strain on their pockets.
The phrase “for those who feel that the coverage isn’t enough” is ominous. What happens to those who cannot afford to pay more than the minimum RM1,000 per year? Is their health coverage going to be less intensive than those who opt to pay more? Would it be – “Sorry, Sir, for people like you on the minimal insurance plan its only medical treatment for coronary artery disease. Angioplasty is for those on the augmented insurance plan”?
There is already a two-tier healthcare system in place in Malaysia now. The richer third of the population can get almost immediate treatment at well-staffed private hospitals in the country. The rest of the population have to queue at the specialist-depleted government hospitals and wait for their turn.
The richer third of Malaysians can get an angiogram done within 24 hours of going to a private hospital while the poorer two-thirds might have to wait for three months just to get to see the cardiologist in the public hospital! That is now, and some of them actually die of their condition before specialist intervention can be arranged. Will this get even worse when the insurance system is put in place?
The PH government has to consider other ways of meeting the costs of providing healthcare to the population. The first would be to review the way in which all forms of supplies are procured. Is the Ministry of Health getting its ringgit’s worth? How many of the contracts to buy equipment, food, furniture, etc are unfairly marked up so that certain crony companies can make a quick buck?
Please take a good look at this phenomenon that we believe is quite widespread. Such contracts should be renegotiated or terminated. We could save quite a sum here.
Then we have the outsourcing of support services to three huge private companies. Laundry, housekeeping, clinical waste disposal, and the maintenance of equipment and buildings have all been outsourced since the mid 1990s. The cost of these services went up three-fold in 1997, the year after they were outsourced! Are the terms of the contracts reasonable or is the health ringgit being funnelled into the bank accounts of politically well-connected companies? Can these contracts be terminated?
Next, the way the government is building new hospitals and clinics has to be critically reviewed. Now they are being contracted out for RM500m or more per hospital, and ever so often we hear of leaking roofs, operating theatres which cannot be used, blocked drainage systems, fungus afflictions and other problems arising from shoddy workmanship, and there are interminable delays. Are the people getting their money’s worth? Shouldn’t the Ministry of Health set up an in-house engineering department that can build all such structures so that the expertise can be cultivated and the outlay be reduced to the actual construction costs of the projects?
The procurement of medicines is another issue that has to be reviewed. Is Pharmaniaga giving us a fair deal or are certain categories of medicines being marked up excessively? Would it be better if we were to switch back to the General Medical Store system that was operational till 1993, when the procurement of medicines was privatised (to a subsidiary of Renong)? This needs an impartial and objective review. We need to ascertain that every ringgit allocated to the Ministry of Health is being used optimally to provide health services to the public.
The issue of patents for medicines has also got to be looked into. Is Malaysia too acquiescent in this matter? The criteria used by India and South Africa in approving patents for new medicines are much more stringent that what is being practised in Malaysia. Why are we so lax? Because we want to prove to the American and EU investors that we are business-friendly? We need to review our stance on intellectual property rights and the granting of patents for medicines; otherwise several categories of effective treatment will be unaffordable to most Malaysians.
The health minister did say (The Star online, 25 May 2018) that he would push for the health budget to be increased from its present 2.2% of GDP to 3.5%. PSM fully supports this initiative for it is one very effective way of sharing the wealth of this country with the poorer half of our population.
Malaysia is currently caught in a low-wage paradigm. Our intention to increase the minimum wage rate has to be tempered by the fact that the lower wages in several countries in Asean might lead to a relocation of manufacturing industries to these countries if we push up our minimum wage too fast.
Though there might be constraints to our intention of raising minimum wages, we can still share the wealth of the nation with the poorer half of our population by augmenting the “social wage”. A subsidised high quality public healthcare system is an important component of the social wage. It saves people the expense of buying health insurance or of paying for private care.
Government planners must also take into account the fact that expenditure on health has many positive “externalities”. This means that apart from the immediate benefit of treating our sick more efficiently, a well-funded public healthcare system also brings other benefits to the nation such as an increase in productivity, enhanced social solidarity and a sense of belonging, and a reduction in delinquent behaviour, anti-social tendencies and “street anger”.
On the other hand, making people pay for their own healthcare by taking health insurance, further increasing the disparity in access to healthcare, will have negative externalities. It will generate insecurity, resentment and result in an erosion of social solidarity. PSM sincerely hopes that the PH government will abstain from moving in such a direction.