THE joint task force committee for medical and health insurance will introduce a number of proposals to contain the spiralling premium rates and push for a more transparent disclosure regime in the sector.
Committee chairman Mark S. O Dell said there had been a turmoil and confusion in the sector resulting in high and uncontrolled billings plaguing the industry.
Bank Negara is set to announce the variations in the guidelines at point of sale so that consumers will know the terms of coverage specifically, O Dell told StarBiz in an interview.
The 12-member committee, formed in July, are equally represented by the three insurance groupings in the country Life Insurance Association of Malaysia (Liam), National Insurance Association of Malaysia (Niam), and General Insurance Association of Malaysia (Piam).
ODell, who is senior vice-president at American International Assurance Co Ltd (AIA), said since the introduction of the medical and health insurance scheme three years ago, the number of sick cases, particularly for inpatient treatment, had doubled.
It has actually risen across the board and the figure looks quite suspicious as you cannot have that many sick people in Malaysia, he said, noting that the task force was also aware of the rising medical costs as a result of improvement in equipment and medication.
ODell said some of the diagnostic tests could actually have been conducted as outpatient treatment to contain the cost.
Another tactic being used is the dual-pricing strategy, where cash-paying patients and medical insurance cardholders are charged two separate rates, he said.
Among the proposals to contain the rising claims include what is called deductibles, where instead of footing all 100% of the bills, insurance companies will share the cost with the insurer at a ratio of 90% and 10%.
This is to control the cost, especially when an insurer with a lower policy requests for a room upgrade, opting to pay the difference. But what is happening is that, when the room is upgraded, other incidental charges will also rise in tandem, making the claims higher than what they should be, he said.
Liam members will start implementing the deductibles next month, while the other two members will follow suit some months later.
ODell said some adjustments to the rates would be introduced next month.
He added that September was the last month for new consumers to pay for policies at the existing rate.