The recent outcry about soaring health insurance premiums prompted Bank Negara to introduce a staggered premium increase plan.
While this move softens the blow, policyholders must still brace for higher payments. It begs the question: can we have our cake and eat it too?
Private healthcare expenses have climbed sharply, often reaching staggering levels as evidenced by public grievances.
Private hospitals defend these increases, citing rising costs of equipment and supplies — a justification that many find unconvincing. For those grappling with inflation, these explanations come across as tone-deaf.
A case in point is the narrative about the rise in non-communicable disease (NCD) patients.
Critics argue that logic also dictates that an increase in NCDs means more business for hospitals, and they can offer lower prices due to an increase in case volume. But that hasn't been the case.
In response to the backlash, the government, in collaboration with insurance and takaful operators and private hospitals, pledged RM60 million to accelerate healthcare reforms.
While this initiative provides a glimmer of hope, its implementation remains under scrutiny.
To address pricing concerns, Bank Negara has proposed the diagnosis-related group (DRG) payment model and the publication of common procedure costs.
The DRG system standardises charges based on diagnosis and treatment, aiming to curb profiteering and ensure fair pricing.
Some observers believe the DRG model could be even more effective if paired with a national healthcare financing scheme funded by a tax on private hospitals reaping astronomical profits.
However, its success hinges on vigilant oversight by regulators, necessitating coordinated efforts by Bank Negara, the Health Ministry and the Malaysian Medical Council.
A recent case highlights the urgency for reform. A seasoned insurance executive was left reeling after receiving a 13-page bill totalling RM18,837.55 for a hernia operation in Kuala Lumpur.
The invoice, itemising 95 charges in 13 categories, underscores the need for price transparency and oversight.
Private hospitals argue that rising costs stem from expensive imports of medical equipment and pharmaceuticals, as Malay-sia lacks local manufacturers.
They emphasise that Malaysia remains one of the most affordable private healthcare providers in Asean, with 90 per cent of patients able to afford the fees.
However, critics argue that inflationary pressures cannot fully explain skyrocketing profits reported by Malaysia's top hospital groups.
In 2023, private hospitals generated RM27.73 billion in revenue, up from RM24.56 billion in 2022.
Two networks commanded 25.6 per cent of the market share, with combined revenues reaching RM7.1 billion. Net profits soared by 58 per cent and 90 per cent, respectively.
These figures, which are available from Bursa Malaysia, cast doubt on claims of cost-driven pricing increases, suggesting profiteering may be at play.
The lack of price transparency has disempowered patients, who are unable to make informed decisions about their care.
Skilled insurance advisers can bridge this gap, advocating fair pricing and guiding clients toward affordable healthcare options.
While Malaysia's private hospitals continue to boost their world-class facilities and attract top medical talent, it's crucial to strike a balance if they are to continue to be star attractions among foreign medical tourists and domestic patients who can afford their fees.
Overregulation could stifle growth and innovation, but profiteering risks alienating patients and eroding trust.
Ultimately, reforms must prioritise transparency, affordability and accountability to ensure sustainable growth in Malaysia's healthcare sector, without killing the goose that lays the golden egg. Let's not bark up the wrong tree.
* The writer is a former Bernama chief executive officer and editor-in-chief