KUALA LUMPUR — Private hospital charges must be regulated as one solution to the root issue of drastic medical insurance premium hikes, an MCA leader said.
Party vice-president Datuk Lawrence Low said regulation can ensure transparency in pricing structures and reasonable fee limits.
“This would not only help curb rising medical costs but also create a healthier operating environment for the insurance industry, thereby addressing the ongoing increase in premiums at its source,” he said in a statement today.
“The root cause of the premium surge is not solely the fault of the insurance companies, but also the continually rising charges at private hospitals.
“Without transparency and standardisation in medical costs, even the best-intentioned premium-sharing policies will only treat the symptoms, not the underlying cause,” Low added.
The lack of regulations on private hospital charges was raised at a recent forum on healthcare costs by Bayan Baru MP Sim Tze Tzin, who said Health Minister Dr Dzulkefly Ahmad had admitted to that his hands are tied on the matter of regulating private hospital fees.
Sim had also called the private healthcare sector here the “Wild West” for going beyond ensuring profitability to “excessive profiteering”.
Surging medical insurance premiums have been a hot topic in recent months following news of increments of between 40% to 70% due to take effect this year.
In December, Bank Negara instructed insurers and takaful operators to spread out the changes in premiums over a minimum of three years for policyholders affected by the “repricing”.
This move is expected to see yearly premium adjustments of less than 10%.
Low, however, said long-term solutions are needed or the “premium crisis” will repeat itself in three years’ time.
“We must urgently push for reforms in medical costs, such as adopting international best practices, promoting bulk purchasing of medications, and encouraging the use of generic drugs to reduce drug costs.
“Furthermore, introducing a diagnosis-related group (DRG) payment system would help reduce over-medicalisation and improve the efficiency of medical resource utilisation.
“Additionally, the government must strengthen the public healthcare system by increasing investment in public healthcare, thus alleviating the pressure that high private hospital costs place on public hospital resources,” Low said.
Introducing the DRG system was mentioned by Prime Minister Datuk Seri Anwar Ibrahim, who is also the Finance Minister, in the Dewan Rakyat last month when he spoke about keeping private healthcare costs reasonable.
DRG will indicate what is a reasonable cost for scans and other medical procedures and treatments.
Health Minister Dzulkefly has also said that the Private Healthcare Facilities and Services Act 1998 needs to be amended before cost control mechanisms can be introduced. He said the ministry is aiming to amend the act in the second quarter of this year. – January 14, 2025