KUALA LUMPUR: The Galen Centre for Health and Social Policy has called for the set up of a Malaysia Competition Commission (MyCC)-like regulator to provide healthcare consumer protection to reduce medical inflation.
The MyCC was set up to enforce the Competition Act 2010 and works to safeguards the process of free and fair competition in commercial markets for the benefit of consumer welfare.
In a statement today, Galen Centre chief executive Azrul Mohd Khalib said a regulator, similar in role and powers to the MyCC, is urgently needed and should be established.
He added that the Private Healthcare Facilities and Services Act (PHFSA) 1998, which currently regulates only doctor and procedure fees, is likely inadequate for this purpose.
"As such, new legislation should be introduced to enact a Private Healthcare Commission. The commission could be mandated to independently review charges and fee increases.
"If the commission finds a rate increase to be unjustified, excessive, or unfairly discriminatory, it should be considered unreasonable, and would need to be subjected to review and publicly disclosed," he noted.
To ensure the commission's effectiveness, Azrul suggested that it may also be necessary to transfer the responsibility of regulating health insurance and takaful from BNM to this commission, ensuring greater relevance and harmonisation of policies.
He said currently, caps and thresholds on insurance premiums and hospital charges appear to be determined by the industry rather than regulated.
"The Galen Centre agrees to the need for responsible medical and health insurance usage, which would reduce the pressure on premium increases."
"If premium increases are necessary, they should be reasonable and justified.
"The Galen Centre has previously and continues to support a co-payment approach to healthcare, specifically within the context of adopting a national health insurance model.
"Co-payment in healthcare is important as it ensures the sustainability of the healthcare system," he noted.
Azrul said Galen Centre supports BNM interim measures on health insurance and takaful but notes they are only a temporary solution to healthcare inflation.
BNM earlier today announced interim measures to assist policyholders facing premium revisions for medical and health insurance, particularly supporting protections for those aged 60 and above.
Azrul believes that this is just a temporary measure and it is not intended to be a permanent solution to the problem of healthcare inflation in Malaysia.
"Unfortunately, it is the equivalent of kicking the can down the road for three years.
"The problem of double digit healthcare inflation continues to exist and grow, but for the moment, by capping yearly premium adjustments to less than 10 per cent, there is relief and a reprieve for many people who were trying to decide whether or not to continue with their individual or family insurance or takaful policies, especially if they are older and above the age of 60.
"The offer of reinstatement for those who have terminated their policies after repricing and not requiring additional underwriting to do so is particularly good and should be commended," he said.
Azrul also urged insurers and takaful operators (ITOs), through their agents, to fulfill their duty of care by reaching out to policyholders promptly and advising them to ensure informed decisions on how to proceed.
Furthermore, Azrul said while keeping premium increases under 10 per cent during this period can be seen as a win for consumers, it raises concerns about what will happen afterward, especially with healthcare inflation projected to rise to at least 15 per cent next year.
"Will this temporary delay result in an inevitable drastic increase later as the cost of claims continues to skyrocket beyond reasonable estimates?
"Insurance and takaful products are businesses which need to respond to ground realities such as the escalating cost of hospital charges which continue to be unregulated.
"Though this temporary measure by BNM is welcomed, the issue of private hospital charges needs to be addressed urgently and decisively," he said.