Medic college shakeout


  • Business
  • Tuesday, 26 Aug 2014

TWO recent negative incidents involving two medical colleges have pointed to the difficulties that mire what is supposedly one of the most lucrative degree courses in the education sector.

 

The world of medical degrees and white coats is one that is fraught with heavy capital expenditure. Then there is the frantic search for lecturers and the fight for clinical training space.

 

These challenges have not discouraged many colleges from mushrooming over the past few months.

 

Today in Malaysia, there are some 32 public and private medical colleges, 40 programmes and some 378 qualifications recognised by the Malaysian Medical Council (MMC).

 

An average of 3,500 medical doctors are produced every year.

 

What happened recently

 

First there was the ongoing saga between staff at Allianze University College of Medical Sciences (AUCMS) in Kepala Batas, Penang, and its employees over alleged unpaid salaries. That situation has taken a turn for the worse and the college is now in severe financial distress.

 

Could this be a case of AUCMS spreading its wings too fast?

 

Only last year, AUCMS purchased a former campus of Middlesex University in Trend Park in north London at price of RM150mil.

 

AUCMS has about 2,000 students and 500 staff members in Kepala Batas.

 

The second incident happened with the US-based Johns Hopkins University School of Medicine. 

 

It terminated its contract with Perdana University Graduate School of Medicine (Pugsom) last month.

 

The dispute is now ongoing and it appears that the Education Ministry is working with Perdana University to resolve this problem.

 

Launched in 2011, Perdana University is run by the Academic Medical Centre Sdn Bhd (AMC), a subsidary of Chase Perdana Sdn Bhd.

 

Pugsom is one of the two medical schools under Perdana University, with the other being the Perdana University-Royal College of Surgeons in Ireland (RCSI).

 

What about the quality?

 

Is the AUCMS incident a precursor to the closure of smaller or weaker private medical colleges? Does this also present an opportunity for the bigger players?

 

The problem now is that there are just too many medical colleges.

 

In 2004, the Government imposed a 5-year moratorium on licences for new medical colleges. Upon the upliftment of the freeze in 2009, a deluge of new licences were given out.

 

Thus again in 2010, another 5-year moratorium was imposed on the granting of new licences.

 

Dr Milton Lum, past president of the Malaysian Medical Association and Federation of Private Medical Practitioners Association of Malaysia, says that it is not enough for the Government to have a moratorium on licences for medical colleges.

 

“They must say no more medical schools, no more new programmes and no more increase in student intake,” he says.

 

Lum adds that everybody talks about numbers, but there is a deafening silence about the quality of graduates.

 

“Medicine is unlike any other course. The medical student must see the patients. This is where you put to practise what you have learnt during the course. In medicine, there is very little room for error.”

 

He says the situation now was one where there were too many students seeing too few patients.

 

Lum adds that private colleges are basically business entities, and hence the end goal is ensuring a profit and paying dividends.

 

Former Health Ministry director-general Tan Sri Dr Mohd Ismail Merican says that Malaysia has more medical colleges than the United Kingdom.

 

“The problem is that there are far too many medical colleges and many of them are struggling to make ends meet. A lot of them can do better in terms of facilities and teachers,” says Ismail.

 

Ismail says that presently, many of the private colleges were having problems hiring good teachers. Many colleges contracted foreign specialists on a non-formal basis or had an arrangement with the public colleges to use their lecturers.

 

Lum agrees that the shortage of teachers is the biggest challenge.

 

“In some cases, you have lecturers in the private colleges teaching certain clinical disciplines but they are non-practising doctors. How can that be? When you do not practise after a while, you will be deskilled.”

 

“I don’t agree there’ll be an oversupply of doctors anytime soon. What we must be very concerned about is the quality of medical graduates this country is getting from the local institutions,” says Tan Sri Clement Hii Chii Kok, founder and group managing director of SEG International Bhd.

 

Consolidation already happening

 

Ismail says there definitely is a need for consolidation as many of the smaller colleges just cannot survive on their own.

 

He adds that Malaysia is in an excellent position to be a medical hub, and a consolidation among institutions will support this cause.

 

“We have very good quality medical colleges but we shouldn’t have too many of them. If we could just have three to four really good ones, this would benefit everyone as the colleges will be able to share facilities, resources and teachers,” he said.

 

Hii says that some smaller players are closing down or downsizing but he has yet to see signs of consolidation.

 

Dr R. Palan, SMR Technologies Bhd (SMRT) chief executive officer, says consolidation of medical colleges is a natural process that will take place. SMRT owns the Cyberjaya University College of Medical Sciences (CUCMS).

 

“I think this process is starting now, especially with the tremendous pressure given by MMC to increase the standards of our local doctors. We do not want a repeat of the nursing industry, where at one point, there were too many nurses, and many of them were not able to perform,” says Palan.

 

Masterskill Education Group Bhd’s major shareholder and executive director Siva Kumar M. Jeyapalan opines that consolidation will eventually take place, not because colleges are poorly run, but because there is no economies of scale if a college operates just on a single course.

 

“If a college were to operate purely on a single medical degree, it won’t be viable as it takes a while before economies of scale is achieved,” he says.

 

“If a college offered many other courses in the same facility, then it would be more cost efficient. The college’s only extra cost would be more lecturers.

 

“Of course, if the college were to offer a course that was so unrelated to medicine, for example engineering, then this would again be very costly as the college would have to invest in a whole new set of labs and other related capital expenditure,” says Siva.

 

Masterskill is in the process of consolidating its campuses in Kota Baru, Kelantan, and Johor, and relocating students there to its Cheras campus.

 

Palan feels the high cost is certainly a factor for consolidation.

 

“There is greater responsibility shouldered by medical institutions. They are being entrusted with the health of the rakyat. So there is no doubt that their capital expenditure and human capital requirement will be extremely high. These are things which cannot be discounted at all,” he says.

 

Oversupply?

 

Health Minister Datuk Seri Dr S. Subramanian had said that the country has 33 medical schools and when adding those who went overseas to study medicine with those graduating locally, the number of doctors entering the market is about 5,000 each year.

 

Palan says the doctor-patient ratio in Malaysia is still trailing the World Health Organisation (WHO) recommendation of 1:600, so the issue of doctors being in an oversupply situation is not the problem.

 

“The problem now is that medical students can only do their clinical training with public hospitals in Malaysia, thus making these hospitals so overrun with medical officers. This poses a very unconducive environment in providing comprehensive training to the future doctors,” he says.

 

Ismail says the issue of oversupply is again tied to the need for consolidation in the industry.

 

“Right now, local hospitals are so overrun with medical staff, officers and housemen. There are more medical officers than patients! So how can you expect to get quality medical workers with this situation?

 

“The Government allows medical colleges to set up their own training hospitals. But how can they do it? It’s too expensive. Some have tried, but it is very costly,” he says.

 

Hii says that the bigger education players may start their own training hospitals in the long term, and it is an aspect SEGi may also look into.

 

Malaysia’s doctor-patient ratio now stands at 1:800, and this is worse off than the WHO’s recommended ratio.

 

Former Health Minister Datuk Seri Liow Tiong Lai had said that Malaysia would achieve the ratio of 1:600 by 2015.

 

With an average of some 3,500 doctors being produced annually, the 1:600 ratio can be attained by 2015 and 1:400 by 2020.

 

However, even with 3,500 doctors being produced annually, there are still hospitals in the country that are facing shortage of doctors and other support staff.

 

Siva Kumar agrees that the problem is not on oversupply, but on the lack of training hospitals for medical students needing to undertake clinical training.

 

“This is the big problem as in Malaysia, we can only do clinical training in local hospitals. However, once this hurdle is overcomed and the medical student specialises, there is huge demand for doctors,” he says.

 

He adds that when a college offers medical degrees, it is somehow a branding on its own. It gives a certain prestige to the college.

 

“So if I were to take away my MBBS (Bachelor of Medicine and Surgery) programme, it would affect my whole franchise because the branding would not be the same anymore,” says Siva.

 


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