PETALING JAYA: Private healthcare providers are expected to be the clear winners of the potential introduction of a national healthcare insurance scheme and the beneficiaries of an overhaul of the local healthcare system, says Kenanga Research.
The research house stated in order to ensure equitable and sustainable healthcare in Malaysia, the national Healthcare White Paper, detailing various reforms, was released in June.
The introduction of a more sustainable health financing model to address the ever-increasing needs of the people and escalating healthcare costs are among the key aspects discussed in the paper.
Kenanga Research recently hosted a talk on the opportunities in the country’s national healthcare insurance scheme reforms, featuring speakers from the Malaysian Medical Association (MMA), Tune Protect Group Bhd and KPJ Healthcare Bhd.
Kenanga Research said sustainable healthcare financing encompassing existing sources such as government funding (the Health Ministry), supplementary funding from the Employees Provident Fund (EPF) and Social Security Organisation (Socso), private insurance payments and out-of-pocket payments, as well as a new source (contributions from the employed and self-employed under a separate scheme) can overcome the challenges presented in the nation’s healthcare landscape.
“The MMA holds the view that the main challenges in Malaysia’s healthcare stem from its dichotomous nature where there is little integration between the public and private health sectors, resulting in an overburdened public health sector while the private sector continues to have excess capacity.
“Other challenges include the ageing population (which increases the need for long-term care, demand for consumables and pharmaceuticals and health workforce), along with the rising burden of non-communicable diseases or NCDs such as diabetes, cancers, kidney, cardiovascular and lung diseases (due to lack of preventive healthcare which significantly increase the cost of treatment in the later stages),” Kenanga Research said.
The research house said a revamped healthcare insurance system could lead to improved overall healthcare services for Malaysians, lower out of-pocket spending, reduced waiting times and access to more modern medicines and technology.
New treatments, drugs, and therapies not available at government hospitals could be made available for patients.
The private healthcare system is paid for by consumers via “out of pocket” payments and private healthcare insurance (personal or employers).
On the other hand, the public healthcare budget is borne by the government (that is tax payers) via mainly the Health Ministry and to some extent the Higher Education Ministry (university hospitals) and Defence Ministry.
It is a multi-payor, multi-provider system with payors including federal and state agencies, local authorities, Socso and the EPF.
“A new source of financing is being considered for the National Healthcare Insurance (NHI), with contributions from the self-employed and employed.
According to an academic study carried out among patients visiting public hospitals in Melaka, 74.5% were willing to pay for the NHI.
The majority (51.3%) of the respondents were willing to pay RM15 or more for the NHI scheme,” Kenanga Research said.
The research house stated the main beneficiary will be private hospitals with IHH Healthcare Bhd and KPJ Healthcare its top picks with a target price of RM7 a share and RM1.50 a share, respectively.