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The Malaysian Health Care System: A Review

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 The Malaysian Health Care System: A Review
Dr. David K. L. Quek, † MBBS (Mal), MRCP (UK), FRCP (London), FAMM (Mal), FACC (USA)
President-Elect, Malaysian Medical Association,
MMA House, 4th Floor, Jalan Pahang, 53000 Kuala Lumpur, MALAYSIA
Email: drquek@gmail.com

Abstract. Malaysia has a dual-tiered system of healthcare services: a government-led and funded public sector, and a thriving
private sector creating a dichotomous yet synergistic public-private model. As yet, we don’t have a unified system of universal
access to healthcare for every citizen. The public sector caters to the bulk of the population (~65%), but is served by just 45%
of all registered doctors, and even fewer specialists (25-30%). The heavily subsidised public sector is almost entirely borne by
budget allocations, with patients paying only nominal fees for access to both outpatients and hospitalisations. The private
sector on the other hand, has grown tremendously over the past 25 years. However, this two-tiered system with quite different
goals may be unsustainable in the longer term. There appears to be ambivalence as to whether to adopt a market-driven
healthcare system or to resort to single-payer National Health Service model where universal access to health care is
guaranteed. Closer partnership, collaboration and sharing of services and personnel may be the way forward. An integrated
system of medical information and expertise access may lead to greater cohesion and efficiency of healthcare services. More
cross-purchases of services should be facilitated where there are shortages. Information exchange can be made efficient
through the use of a unified system of health information portability mechanisms, while safeguarding and ensuring patient
confidentiality and privacy. Full integration of private-public healthcare sectors appears unlikely, but better partnership and
collaboration of services can be aspired to, where the best of each system can be harnessed for the healthcare betterment of
our citizens. We should aim for a more cost-effective system. A single or easily portable system of reimbursement should also
be considered.

Keywords: Malaysian Healthcare System, Healthcare Services Sharing, Public-Private Integration,

Corporatisation, Single Payer Initiative,

1. INTRODUCTION expected that the government guarantees a comprehensive

provider function at greatly subsidised rates or at token
sums—that taxes and other contributions should provide
Malaysia currently has a dichotomous public-private
adequately for most if not all its citizens, with the
system of health care services. From what was largely a
government taking up the shortfalls for unexpected costs
government-led and funded public service enterprise since
due to catastrophic or chronic ailments.
the time of independence, our healthcare service has over
On the other hand however, there appears to be a
the decades (since the 1980s), transformed into a buoyant
covert if unannounced shift in thinking that eventual
dual-tiered parallel system, with a sizable and thriving
corporatization of the public sector facilities and services
private sector. But, we have not approached a unified
should be allowed to unfold, where market forces dictates
system that is a declared national healthcare policy of
the price, extent and quality of the services offered. The
offering universal access to every citizen.
ultimate aim is that the government should play only a
There appears to be strong ambivalence as to whether
regulatory, monitoring and facilitator role to safeguard the
to fully tap into the free market system for healthcare
welfare of its citizens, while at the same time encouraging
provision and funding or to resort to a single payer publicly
growth of the less-bureaucratic, better-run and more
controlled system where universal healthcare access is
competitive private sector.2
assured. Some mix of these two disparate systems seems to
Thus, despite public dissent, over the past 20 years or
be in play at the current moment.
so, there have been sporadic if partially successful attempts
On the one hand, there has always been an
to privatize or corporatize various components of the public
overarching concern for the common citizen, especially the
health sector, e.g. the government’s drug procurement and
poorer segment of Malaysian society, where there is an
distribution centre (to UEM’s subsidiary Southern Task,
implied social contract and acknowledged ‘right’. There is
later renamed as Remedi Pharmaceuticals, then as
a deep-seated commitment of the Malaysian government to
Pharmaniaga); and the divestment of its support services
eradicate poverty and develop human capital.1 It is

________________________________________
† : Corresponding Author
(cleaning, linen, laundry, clinical waste management,
biomedical engineering maintenance) to Pantai Medivest,
Radicare and Faber Mediverse.3
Furthermore, there has been full and implicit
encouragement of the private sector to flourish with
differing modes of financing and capital injection.
Government-linked corporations (GLCs) such as the KPJ
(Kumpulan Pelaburan Johor) and Sime Darby groups and
latterly the Ministry of Finance investment arm, Khazanah,
have been pushed to become major players in modernizing
and extending the reach of the private health care services
in Malaysia and beyond.
A UNDP Human Development Report (2006)4 paper
determined that in 2005, the Malaysian government spent
just 2.2% of its gross domestic product as its contribution
to the public sector healthcare funding, while some 1.6% of
our health care expenditure came from the private sector.
The World Health Report 2006 stated that the Malaysian
government spends some 6.9% of its total expenditure, on
health care.5
Yet despite such a low level of national investment on
healthcare (just 3.8% of GDP), we have achieved quite
laudable health outcomes results. Our life expectancy at
birth has risen from 55.8 years and 58.2 years for men and
women, respectively in 1957, to 71.8 and 76.3 years,
respectively for 2006.6
The tax-funded public healthcare sector caters for the
bulk of the population (~65%), but is served by just about
45% of all registered doctors, and even fewer specialists
((25-30%).7 The cost of these services is almost entirely
borne by budget allocations from the central treasury, with
patients paying paltry nominal sums for access both to
outpatient clinics or admissions to hospitals. These are
offered at unrealistically cheap but clearly cost-effective if
heavily subsidised rates. However, this is questionably
sustainable in the longer term, if we allow market forces to
prevail.8
2. PUBLIC HEALTHCARE SECTOR
2.1 Rural Health Service
This is one of the largest sectors in the services
department whereby the government provides almost all
the infrastructure and the human resources. Doctors, nurses,
pharmacists, dentists and other allied healthcare workers
are employed and deployed by the Minister of Health to
various healthcare centres: from rural clinics to district
hospitals to tertiary specialist hospitals throughout the
country.
The distribution of these resources to various parts of
the nation is arguably based on the size, need and
population of the various districts and states. However, the
reality is that in the rural and more mountainous or remote
(less accessible river-bound or jungle/forest) regions, the
deployment of facilities as well as manpower is uneven and
there remains great disparity and inequitable distribution of
health care personnel, especially doctors.
Nevertheless, Malaysia boasts of having a healthcare
facility within every 5 km radius, which, renders especially
for the rural folk, relatively easy access to these clinics
whenever the need arises. However, not all are manned
with adequately trained staff—most are under the charge of
a jururawat desa (or rural health nurse), with sporadic
visits by a medical assistant or a doctor, ranging from
weekly to monthly schedules.3
Deployment of medical personnel to such rural sites
remains very unpopular with the better-trained and
educated staff, that views the remoteness of such postings,
unrewarding. There should be greater monetary and even
promotional/seniority incentives such as hardship
allowances or tax breaks, (such have been offered to
teachers) promised preferential selection for training and
development protocols and career development, to attract
more doctors and personnel to such areas.9
The MMA (Malaysian Medical Association), through
its Section Concerning House Officers, Medical Officers
and Specialists (SCHOMOS) has been arguing for more
structured deployment planning, such that even with these
incentives, there should be detailed contractual
undertakings that these personnel would be re-deployed to
bigger centres of their choice, (for clearer career
development programmes or pathway) once they have
completed their ‘hardship’ service in the interior.10
Failure to appreciate these doctors in particular, have
led to many younger doctors complaining that the
government is not concerned about their welfare and their
future. Thus after such remote postings which they view
with some discomfort, many are ready to throw in the towel
and leave once their service contracts in compulsory
service is over. By showing more concern and offering
more incentives, we may be able to hold on to more of our
public service staff, rather than losing them immediately
after these postings.
2.2 Tertiary Healthcare Services
Notwithstanding these problems, the past 5 decades
have seen the Malaysian healthcare structure remaining
quite well integrated. The rural health service provides
effective primary healthcare coverage, which is connected
to large hospitals in each state and the capital city through a
unique system of referral. For medical and surgical
emergencies, these are adequately provided for, with a
government-managed fleet of ambulances, including airlift
capacities for more interior remote sites.
Tertiary Care Hospitals have recently made its
presence felt in the Malaysian public healthcare sector,
beginning in the 1980s, with the expansion and
privatisation of the University of Malaya Specialist Centre
(Petaling Jaya), and the building of the Universiti
Kebangsaan Malaysia Medical Centre (Bandar Tun Razak,
Kuala Lumpur), and the renowned National Heart Institute
(Institut Jantung Negara, IJN), along Jalan Tun Razak.
These have provided excellent specialist care for several
highly specialized medical disciplines such as cardiology,
cardiothoracic surgery, nephrology, cancer care, neurology
and some infectious diseases. These however cater
predominantly to our Malaysian civil servants, pensioners
and their dependents (including many of our VVIPs), but
due to facility constraints, long waiting times are now the
norm.
In the past decade or so, several other public hospitals
with tertiary specialist facilities have been developed in
most major cities in the country, in Penang, Melaka, Johor
Bahru, Kuching, Serdang, Selayang, Ampang, Sungai
Buluh, Kota Bharu, Kuantan and Kota Kinabalu.
Although these have added to the capacity to cater to
the growing demands for tertiary specialist medical care,
the problems of understaffing and staff poaching continue.
We seem to be unable to adequately provide enough
manpower and skills development to sustain better than
average care at these centres.
Poor planning and maintenance has led to
infrastructure failures such as has been recently highlighted
in KK’s Queen Elizabeth General Hospital, where an entire
wing has been condemned, shutting down essential services
such as intensive care and surgical operating units. This ad
hoc approach has in the past few years, forced the heavy-
handed expensive purchase of the former Sabah Medical
Centre to be converted to the Likas’ Maternity Hospital.
Now, there are plans to purchase of the newer just
completed 171-bed SMC at Luyang, to replace the
condemned section of the main hospital in KK for the
public!11
2.3 Purchasing Private/Corporate Sector Expertise
Migration of trained staff especially medical
specialists to the private sector continues to bug the system,
which then causes the expert service to stall, because the
requisite expertise had been lost. In critically short-staffed
services such as neurosurgery, the public sector has to
occasionally buy the services of private neurosurgeons to
attend to their patients, especially during emergencies.
Currently, in Kota Kinabalu, Sabah, cardiology and
cardiac surgical services are purchased with weekly
rotations of specialists from the corporatized IJN, at hefty
prices. Also being a corporatized medical centre, the IJN
has been billing the government to take care of its public
servants, pensioners and referrals from its MOH hospitals
and clinics. This comes at a premium, with the government
reimbursing some RM 31.3 to 144.5 million per year, from
1993 through 2004, respectively, for these services.12
However, because of higher wages and better work
conditions/benefits, specialists at the IJN appear to have
less rapid turnover (3% annually), and thus enjoy greater
consistency and continuity of services.13 This also makes
continuing manpower and specialist training possible, too,
to enable it to maintain its reputation as a centre of
excellence. But obviously this comes at a higher cost—
perhaps this expenditure is more realistic in terms of
healthcare economics. This successful model has now made
it an object for takeover by a GLC, Sime Darby Bhd.2
So this model of public-private partnership appears to
be successful and beneficial and attempts have been made
to have it emulated. However, there have been serious
misgivings about this concept of healthcare reform because
of its wider socio-economic implications; the Coalition
Against Health Care Privatisation has been most vocal
against any development toward the passing of any extra
cost to the public.14,15, 16
2.4 Full Paying Patient
In 2005, another patient fee-paying system was
introduced i.e. Full Paying Patient (FPP) scheme, where
part of the fees were used for physicians’ reimbursement to
supplement their income/allowance. Thus, this scheme
provides those who are willing to pay more, quicker access
and shorter waiting times for elective surgeries and other
therapies. While this is one mechanism to recover some
costs for the healthcare system, it is only a minor fraction
of what the system truly costs. There has been great
unhappiness that this will only encourage queue jumping
from those who are well-to-do, and therefore penalise the
poor and less-financially endowed, and consumer pressure
groups have called for their abandonment.15,16
Still, the sporadic but unending attrition of losing
specialist to the private sector has long been the problem of
the public healthcare sector, and staff and expertise
retention is a perennial problem, which has yet to be
resolved or tackled sensibly and judiciously. Some 300
doctors and 50 specialists leave the public sector
annually.7,15, 16
3. PRIVATE HEALTHCARE SECTOR
The private sector on the other hand, has always
attracted both general and family physicians who had opted
out by opening individual clinics or by joining more
established group practices; while specialists join the
better-paying more personalised care practices in urban
private medical centres.
Private healthcare expansion began in earnest during
the Mahathir premiership in the 1980s, where private
hospital beds increased nearly 10-fold (from 1171 to 10405
between 1980 to 2003), and the private sector’s share of
hospital beds increased from 3.9-5.8% to 23.4-26.7%.17,18
On average over the years depending on the economic
circumstances, this private sector constitutes around 55% of
all registered doctors, who look after some 25% of the
population, most on a self-paying fee-for-service
arrangement, and increasingly through some third party
paying (e.g. health insurance) mechanisms.19
3.1 General Practitioner Clinics
Importantly nationwide, private clinics cater to most of
the fee-for-service self-paying public, which include:
private sector employees through panel doctor
contract/insurance arrangement; thus relieving the already
overloaded Ministry of Health’s public clinics. In general,
the choice for such private clinic consultations and
treatment is due to easier access, simpler registration and
appointment, and shorter waiting times. There is also
possibly greater continuity of care with better personal
attention from one’s own family physician or general
practitioner—i.e. superior personal touches and closer
encounters are the added values in private clinic visits,
despite greater fees for consultation and medicines, which
are frequently bundled together.
Some crossover of services however exists. Depending
on patients’ demands or choices, these generally
complement each other for the greater benefit of the
patients concerned. Dissatisfaction or uncertainty with
services from either sector has on many occasions led to
patients seeking second opinions and/or therapies from the
opposite sector, and vice-versa. Although there have been
counter-accusations of poor and/or unprofessional care, or
mismanagement issues, each sector does cater to the
differing demands and expectations of the public. In
economic terms there is some duplication of services, and
possibly over-utilisation and wastage of resources, but
patient choice is preserved as a right.
Thus, urban GP clinics provide easy care for common
ailments and simple trauma/injury management, at very
reasonable costs, especially for areas outside the main
capital city—Kuala Lumpur-Klang Valley, and
complement the public sector in helping alleviate the
patient crush on their severely overloaded outpatient
clinics.
However, of late, with the mushrooming of many GP
clinics in close proximity to one another, competition for
patients has become keener, and many clinics are simply
eking out a living, struggling to keep afloat. Some have
resorted to creative complementary alternative medicine or
aesthetic/beauty health care shifts to supplement or even
revamp their practices. Still the MMA continues to receive
complaints of there being too little work and income for a
sizable number of clinics in larger urban centres.
This underutilisation of many urban clinics is wasteful,
and could perhaps be one mechanism to help out the
overcrowded public sector outpatient clinics.
Redistributing public sector patients who sometimes
have to wait several hours, to a panel of urban or suburban
private clinics nearer their home, can be a real option for
better patient care and attention. A payment mechanism can
be worked out to address this purchasing of services, which
will generate a win-win scenario for all concerned.
However, logistics and bureaucratic red tape and
registration exercises have made this approach of sharing of
services impossible to carry out at the present moment.
3.2 Private Medical Centres & Hospitals
For more serious illness and injuries, hospital care
through well-equipped emergency departments (EDs) is
now the expected practice. These medical emergencies are
previously offered only at larger public sector general or
district hospitals. These days however, most private
medical centres boast of state-of-the-art emergency care at
more luxurious settings and costs. Personal and more
attentive specialist care are now demanded and offered at
many of these private EDs, where many orthopaedic
surgeons and neurosurgeons now practice privately.
However, private medical centres are not simply for
emergency and/or trauma care. Most are now developed as
competitive consumer-driven full-fledged healthcare
facilities to cater for the more discerning public who would
pay more to obtain perhaps better (perceptibly), more
personalised, faster (less or no waiting time) and possibly
more comfortable and/or luxurious medical care.
Health insurance or maintenance organisations have
also bought into this system to offer more premium benefits
to their clients, particularly those of the corporate world,
where risk-averse and delay-averse market-driven results
are expected. Executives and staff are offered contracted
quicker and direct access to possibly more expert
specialised care, with faster turnaround times and earlier
return to work expectations.
Of late, the entry of different national and transnational
capital flow into the private healthcare system has further
developed the service capacities of this sector. Healthcare
industry players such as the state-owned KPJ group (Johor
State Development Board), Parkway Holdings (Singapore-
based, American-invested), and latterly Khazanah National
Berhad (a Ministry of Finance Malaysian GLC) have
greatly influenced the direction and expansion of these
private services, while at the same time inflating the cost of
private health care services by offering more sophisticated
amenities and newer technology-driven expert care.
Together with the Association of Private Hospitals
(APHM), there has been a move to expand the services
toward attracting foreign medical tourists, which is targeted
to grow to 30% in 2008, and nearly 1 billion ringgit as of
2005.17,20
3.3 Private Healthcare Facilities and Services
Act/Regulations
Currently, the Private Health Care Facilities and
Services Act (PHCFSA)21 and Regulations (PHCFSR)22
have prodded the private sector to transform for the better,
purportedly for safeguarding the safety of patients. But
forced administrative micro-management, stiff fines and
restrictions have angered many private medical
practitioners.23 Many are unhappy with the highhanded
tone and manner of the regulations, inspections and
implementation, which have been construed as trying to
criminalise doctors.24 At least one physician had been jailed
for technical non-registration, and a few have been fined
heavily because of technical breaches of these new
regulations. Some clinics have been inspected with disdain
and rudeness.25
4. HEALTHCARE SPENDING & ACCESS
ISSUES2
Healthcare spending is still suboptimum in Malaysia,
the government spending just 6.9% of its total expenditure
on health care services (i.e. 2.2% of the GDP). In 2003,
Malaysians spend just USD 374 in total (Purchasing Power
Parity) per person per year on healthcare expenditure, with
the government contributing USD 218.5
This compares with USD 1156 for Singapore, USD
260 for Thailand, USD 2244 for Japan, USD 1074 for
South Korea, USD 2874 for Australia, USD 2389 for the
United Kingdom and USD 5711 for the United States of
America.5 As can be seen, although we pride ourselves as
becoming more developed than many other nations around
us, we have yet to emulate those with better and arguably
more advanced healthcare services.
Out-of-pocket spending as a percentage of private
expenditure on health takes up about 75% of the total costs,
with some form of private prepaid plans (e.g. insurance)
contributing 11.9 to 14.2% over the years from 1999 to
2003. Social security expenditure as a percentage of
general government spending on health hovers around
0.8% only, mostly from requested withdrawals from the
specific allowable account within the Employee Providence
Fund savings (EPF).5
4.1 Public Aversion to Paying More
Because of the ingrained norm of having to pay so
little or not at all in public hospitals and clinics (which are
almost totally subsidised), the Malaysian public does not
feel that it has to budget for health or medical care, and this
is reflected in many of our pensioners complaining of
costly unplanned-for medical care. This is also reflected in
our government’s paltry allocation of importance toward
healthcare spending in our national budget.
There has been flip-flopping ambiguity from the
MOH, as whether to allow market forces to dictate
healthcare costs, but overall, there has been no public will
to enact what could be unpopular.2 Suggestions to end free
treatment at public hospitals and highlighting that rising
healthcare cost is too heavy a burden for the government,
had not been too well-received by the citizens.26,27
This strategy seemed to have disappeared following
the recent electoral setbacks of the incumbent government.
In a recent interview for internet media Malaysiakini, the
new health minister Dato’ Liow admitted that the public
hospital services are heavily subsidised by the government:
RM12.9 billion or 98% of the entire budget, while patients
paid only 2%! But, Dato’ Liow reiterated his views that
government subsidies for patients utilising public
healthcare facilities would continue (RM1 for outpatients
clinic visits, RM5 for specialist clinic visits, and maximum
RM50 for third-class ward hospitalisation costs), and
pledged the populist view that such a quantum would
continue, despite this being unchanged since the 1970s!28
There is great expectation that the government of the
day should not jeopardise this by instituting any
mechanism, which can change this status quo—hence there
is relatively very little public or open debate on these
issues.
4.2 Access Failure & Medical Assistance Fund
But concerns as to failures in access continue to pop
up sporadically in the mass media.29 Poorer patients have
resorted to the mass media appealing for financial
assistance to help defray medical costs, especially for some
costly or tertiary specialist care—e.g. in one week alone in
October 2007, there were at least 3 appeals for help.30,31,32
Thus, this has prompted some stopgap measures such
as setting up a Medical Assistance Fund (MAF) of RM 25
million, by the Ministry of Health. However, this fund can
only be utilised at public or quasi-governmental healthcare
facilities, and appeals have to be vetted stringently to
ensure need and priority, which had drawn sharp criticisms
of this being too bureaucratic and slow, even unfair.33 Yet
another Emergency Fund (D’tik, an acronym for Dana
Talian Insan Kritikal Yayasan Kebajikan Negara) has been
set up. This fund of RM5 million, provides critically ill
patients access to treatment within 24 to 72 hours, but is
currently only available at Kuala Lumpur Hospital as its
pilot medical facility to kick-start the programme.8,26
Clearly, such setbacks and failure of access implied
that the public healthcare sector needed a revamp to
enhance its capacities. Providing such services at huge or
near-total subsidy appears untenable and unsustainable, and
still left gaps, which had to be filled by creation of some
extra mechanism to expedite access (predominantly by
offering extraneous funds and/or donations). Thus, this
explains in some way the government’s overt
encouragement for the private sector to flourish and
develop, in order to cater to the more willing, discerning,
paying citizens, and leaving the public sector to look after
the less endowed.
4.3 Corporatisation / Privatisation Controversy
Earlier hints that the public sector health services
should be restructured into a government-owned non-profit
entity, made economic sense in its first offering. This
‘corporatisation’ model implied converting most of the
larger public hospitals into operating as quasi-private
entities. This would avoid creating a two-tier system, and
would facilitate disbursement of funds when a single payer
health insurance scheme was introduced.34 At least that is
what had been planned.
However, many are still quite in the dark as to when or
if these would be enacted, and serious doubts and anxiety
have been raised. This ambivalence is now quite
understandable because earlier attempts to corporatize these
public hospitals and facilities were scuttled after news leaks
prompted severe backlashes from some consumer and
pressure groups and opposition politicians.15,16,17,35
4.4 Skim Insurans Kesihatan Kebangsaan (SIKK)
This brings us to the question of having a single payer
system, which has been earlier mooted as the preferred
system for encouraging or implementing universal access
to health for all.7
The much-awaited National Healthcare Financing
Scheme, now rebranded as the National Health Insurance
Scheme (Skim Insurans Kesihatan Kebangsaan, or SIKK),
appears to be a political deadweight. Following the
formation of the new government, this has once again been
deferred for fears of public disavowal and protests.
Perhaps, there are just too many variables inherent in the
Malaysian system, which renders such a scheme too
politically incorrect, too inexpedient to implement.36,37,38
Interestingly, when it was raised earlier, the MOH
tried to allay public fears by announcing that civil servants
(which number 1.2 million people, including military and
police personnel) and their dependants, 200,000 disabled
persons, 435,000 pensioners, 250,000 hardcore poor and an
unknown number of unemployed individuals, would be
exempt from the SIKK. What is not clear is whether the
government would pay the premiums for these people or
that they will continue under the present system of
healthcare. The latter option would defeat the purpose,
because this would undermine the community-rated
concept of the SIKK.15
Also considering the fact that only 1.2 million
Malaysians pay any taxes, collection of such a mandatory
‘health tax’ would be a struggle and challenge. It has been
calculated that based on an estimated 4.63 million families
in Malaysia (25 million population, average family size
5.4), this sharing of the burden (RM13 billion as of 2003)
would encumber each family household around RM2,808
per year or RM235 per month.15 Clearly, many would not
be able to pay, because more than 58% of Malaysians earn
less than RM2000 per month, per family; and paying more
than 10% of the salary on healthcare premiums would be
too high! Besides, the government would still have to
cough up possibly billions of ringgit to sustain the
shortfalls and other preventive health care measures. This
scheme has been criticised and rejected by the Coalition
Against Healthcare Privatisation, as putting the onus of
premium paying on the lower- and middle-income private
sector employees and citizens.15, 16
So, for the foreseeable future into the next 4-5 years at
least, it is very unlikely that there will be any attempts to
resurrect such a tendentious issue as a national health
insurance mechanism. Our current system which has been
described by Chee H. L.19 as segmented, polarising and
eventually untenable, is therefore likely to be the status quo
for the time being, and making this work better for our
citizens should be the way forward, at least for the interim.
5. PARTNERSHIP: COLLABORATION VS.
INTEGRATION OF SERVICES
The health minister Dato’ Liow has said that
“Government and private sectors should work together.
Because the doctors that we train are for the nation,
irrespective of (whether they work for the) government or
private. Doctors are serving the people. In Malaysia, 41
percent of our population go to private hospitals and
clinics and 59 percent go to public health institutions.
Therefore, the private sector is playing an important role to
ease the burden and also the workload in government
hospitals.”26
It is heartening that the current health minister is
enlightened and positive about this private sector
contribution. Therefore, this is an opportune time to ensure
that the mechanisms for better partnership between public
and private healthcare sectors be forged to facilitate closer
and more meaningful collaboration.
5.1 Is More Privatisation the Way Forward?
One way to further this is by privatising more of the
public healthcare facilities, but this is fraught with
uncertainties, although such exercises might make
administrative and economic sense and offer greater
balance sheet accountability. One inevitable problem will
be the almost inescapable escalation of the cost of services
to ‘real’ terms, with progressively less subsidies. The poor
unfortunately, could be left out of the loop with uncertain
safety nets to cushion their plight.
The recent suggestion by Sime Darby Healthcare to
acquire a stake in IJN (now a corporatized entity 99.99%
owned by the Ministry of Finance) has already brought a
swift and negative dissident response from a newspaper
editor.39 Gunasegaram P. has stated his dismay that “for
large sections of the Malaysian public, the very idea of
privatising IJN is shocking because charges will rise to
astronomical levels.” He questioned whether there is any
net benefit to the public or government, and that if there
were any reasonable doubt, this privatisation should not be
undertaken. He alluded to past experiences that previous
privatisation exercise of other services had not brought
down costs for the public or government. He concluded that
“(t)here are some things that should not be up for sale at
any price. Affordable health care for the general public is
one of them.”40
In another article in The Edge Daily, it was reported
that the health minister and his ministry is not too happy
with this divestment, either.41 However, the Prime Minster
and his deputy appears to have already endorsed the plan,
just cautioning the GLC against forgetting its social
responsibility to the poor, and they seem to imply that this
exercise would allow the private healthcare sector to grow
even more.42
Latest reports suggest that this takeover bid by Sime
Darby has been deferred indefinitely due to public outcry,
and possible political fallout.43,44 The former Health
Minister Datuk Seri Chua Soi Lek has also condemned this
sell-off bid, which he said has put paid the good will of the
government, despite it costing the government just a
‘paltry’ RM 200 million a year (about 2.5% of the national
health budget) to run the IJN.45 Thus, there is this incessant
tussle for public need/good versus free-trade market-driven
practices from administrative or financial/budgetary
realities points of view.
5.2 ‘Rentier Capital’ Divestment Concerns
There are of course, also worries about ‘rentier capital’
economics where state assets are divested to politically
well-connected private entities through a system of political
patronage, perpetuating mutual dependence between the
business elite and the political rulers, i.e. the ‘crony
capitalist’ model that supervenes the true nature of this
form of take-over. Most economists believe that this form
of rentier capitalist model unfairly enriches these business
elites at the expense of costlier services and goods to the
public at large, and is therefore, wasteful and
counterintuitive toward better productivity.46
5.3 Toward a More Efficient System
In his book on ‘Good and Bad Power’, Geoff Mulgan
(a British political scientist) discusses that while most
governments provide the structure, it is the more
comprehensive, well thought-of infrastructure provisions
that lead to transformative services—that “much of the
recent thinking about service… has adopted models from
the private sector… largely drawn on industrial… models
favouring speed, standardization, flow and efficiency.” He
went on to describe: “(t)hese services are human,
immediate, personalized and rich in communication,
anticipating need rather than just meeting it and ‘going the
extra step.’ In the case of therapeutic services the servant’s
job is to change the master, to make him healthier, fitter,
and happier.”47
In a paper on the Singapore model of public-private
partnership, Dr MK Lim identifies 3 key questions which
should be answered: (a) how to raise revenues to pay for
health care; (b) how to pool risks and resources; and (c) how
to organise and deliver health care in the most efficient and
cost-effective manner.
It is clear that there is no foolproof system anywhere on
the globe. Some of the more successful models involve a mix
of safety nets with monitored privatization/corporatization of
services and allowing ‘coopetition’ (competition and
cooperation) to thrive.48 He further argues that “even in
Europe, the sustainability of health care systems founded on
egalitarian welfarism is increasingly being challenged as
growth in demand outstrips supply. The debate is no longer
about ‘who should pay?’ or ‘who should provide?’ but ‘who
can do the job more efficiently?’”
5.4 Fine-Tuning Private-Public Partnership
Thus, as our two-tiered system is now so well
entrenched, we should find ways and means to ensure that
it works better and more efficiently, where we can
synergise our efforts to provide good quality, safe, and
cost-effective healthcare for our patients. However, this
must not only be affordable but also be self-funding and
self-sufficient.
Where too much bureaucracy bogs down the better
productivity and efficiency, these should be dismantled and
restructured in ways that encourage best practices, and
which empowers and benefits the patient ultimately.
Practice issues such as difficulty in cross-referring
patients between private and public sectors should be
eliminated; data and medical information portability and
sharing should be facilitated and unified. Where there is
excess of amenities on either side, these should be shared
with crossovers of public to private sector and vice-versa.
Conversely, more cross-purchases of services should be
facilitated where there are shortages. Arbitrary turf
protectionist methods to deny either patient or physician
access to information or services of either sector should be
removed.
Information exchange can be made more efficient
through the use of a unified system of health information
portability mechanisms, e.g. MyKad or some other central
access information systems, while safeguarding and
ensuring patient confidentiality and privacy.
Full integration of private-public healthcare sectors
appears unlikely, but better partnership and collaboration of
services can be aspired to, where the best of each system
can be harnessed for the healthcare betterment of our
citizens. We should aim for a more cost-effective system,
although not necessarily a lower cost one. A single or
easily portable system of reimbursement should also be
considered.
While corporatisation/privatisation is still much feared,
as a model of divesting central control of unavoidable
rising costs and developmental constraints, this might be
the way to go, if the model for market-driven healthcare is
adopted. This is the model practiced by Singapore, with its
well-tried and tested schemes that can be tweaked to
respond to the many diverse facets of healthcare
peculiarities.43 Or conversely, a single-payer (and/or single
insurance) National Health Service mechanism could be
introduced, learning from the examples of say, Taiwan,
Canada or the UK.48, 49
Whatever the decision, the government must make
greater efforts to engage and explain to the public the
policy directions that it wants the country to advance with
regards healthcare services. This is especially urgent
because by 2010, when trade and services liberalisation is
set to take place in ASEAN (Association of South East
Asian Nations), with the roll-out of the AFTA/WTO
(ASEAN Free Trade Area/World Trade Organisation)
agreements, there will be other considerations of foreign
participation and entry into this economically important
sector.
ACKNOWLEDGMENT
Thanks to the MMA secretariat for support in obtaining
some references and research data.
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AUTHOR BIOGRAPHY
Dr David KL Quek is President-Elect of the Malaysian
Medical Association (MMA) Kuala Lumpur, Malaysia. He
received his medical degree (MBBS) from the University
of Malaya, Kuala Lumpur in 1979, and underwent
postgraduate medical and cardiology training in London,
from the Royal College of Physicians of the United
Kingdom (1984). He is currently fellow of the Royal
College of Physicians of London, the Academy of
Medicine of Malaysia, the National Heart Association of
Malaysia, the ASEAN College of Cardiology, the Asian-
Pacific College of Cardiology, The American College of
Chest Physicians and the American College of Cardiology.
He is actively engaged in teaching and lecturing, earlier at
the Universiti Kebangsaan Malaysia (1985-1991), and now
lectures on specialist topics in Cardiovascular Medicine for
the National Heart Association of Malaysia, ASEAN and
Asia-Pacific Colleges of Cardiology. He has published
more than 40 medical and cardiology papers in national and
international journals, and lectured more than 200
medically-related talks.
He has been involved in medical professional issues
for many years, being editor-in-chief of the MMA News
(Berita MMA) from 1996 to 2007, and written more than
100 editorials/commentary articles on medical professional
issues, medico-legal issues, medical ethics and education.
He has been an invited participant in several Ministry of
Health programmes such as National Health Policy
Planning, 9th Malaysia Plan mid-term review, National Use
of Medicines Committee, National Seminar on Health
Economics & Financing. He is also a 2-term elected
member of the Malaysian Medical Council (2004-2010), a
regulatory/disciplinary body of the Ministry of Health. He
recently attended an INSEAD executive programme on
leadership development in Fontainebleau, France. His
email address is <drquek@gmail.com>
(accessible from the internet:
http://cpds.fep.um.edu.my/events/2009/workshop/290
42009/PPT%20&%20full%20paper/session%203/The
%20Malaysian%20Health%20Care%20System1-
presentation-dr%20david%20quek.pdf)
[This paper was presented at the Intensive
Workshop on Health Systems in Transition (April
29 & 30, 2009) Organised by the Women's
Development Research Centre (KANITA) & the FEA
of University of Malaya at Conference Room, Level 3,
Postgraduate Building, Faculty of Economics and
Administration, University of Malaya, Kuala Lumpur.]
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