Materia Medica Malaysiana

National Health Insurance Can Marginalise Poor, Say Activists

PENANG, Malaysia, May 30 (IPS) - Civil society activists are concerned that a proposed national health insurance scheme scheduled to take off at the end of next year, while catering to well-off Malaysians, will marginalise Malaysia's poor -- many of whom can barely afford to pay for basic medical services.
So far few details of the scheme have been disclosed. Consultants have been appointed under a shroud of secrecy to work out the mechanism for the scheme under which a proposed National Healthcare Financing Authority would manage the annual 13 billion ringgit (3.4 billion U.S. dollars) financing for healthcare in the country, of which 8 billion ringgit (2.14 billion U.S. dollars) is currently spent by the public sector.
To allay fears, officials say that one million civil servants, 200,000 disabled, 1.8 million senior citizens, 435,000 pensioners, 250,000 in hard poverty and the unemployed would be exempted from making mandatory monthly contributions.
But there are worries that even with these exemptions, the lower income group would struggle to make regular contributions.
For official purposes, households earning less than 500 ringgit (131 U.S. dollars) per month are considered poor, while the threshold for measuring those in hard poverty is about half of that. But activists say a more realistic poverty line should be closer to 1,000 ringgit (262 U.S. dollars) or even higher.
According to the Eighth Malaysia Plan, a quarter of all households have monthly incomes less than 1,000 ringgit, which means that these families would be hard pressed to make any sort of monthly healthcare contributions.
Even households earning less than 2,000 ringgit (524 U.S. dollars) -- 57 percent of all households -- would find it difficult to cope with regular healthcare contributions, say activists.
''This means that the government would still have to subsidise some patients,'' said Jeyakumar Devaraj, a respiratory physician-turned-activist campaigning against healthcare privatisation, at a recent talk.
The consultants looking into the scheme face a huge dilemma given the gulf between the public and private hospitals in the country.
Malaysia's public sector, catering largely to the lower-income group, is already overstretched and under-funded. The 120-odd government-owned hospitals have 34,000 or three quarters of the total hospital beds in the country. In contrast, 220-odd private hospitals have only 9,100 beds.
But the government-owned hospitals employ only a third a third of the physicians and surgeons in the country. These underpaid and overworked professionals have to cope with 80 percent of the total in-patients in the country.
Critics say many of the problems plaguing healthcare in the country have their roots in the era of Prime Minister Mahathir Mohamad. Economist Subramaniam Pillay notes that when Mahathir came to power in 1981, he introduced policies to allow the private sector to play a greater role in non-traditional roles such as health and higher education. The number of private hospitals soared.
But, instead of solving problems, the public sector experienced a massive brain drain. Two thirds of the surgeons and physicians in the country prefer to work in private hospitals, where they receive lucrative monthly incomes amounting to tens of thousands of ringgit and in some cases more than 200,000 ringgit (26,300 U.S. dollars) per month.
''The basic cause of the problems is structural: the growth of the private hospital industry catering to the wealthy in society sucked away expertise from the public sector,'' said Subramaniam, who is also a member of the steering committee of the Coalition Against Healthcare Privatisation, made up of 81 civil society groups.
''The consequence was a decline in the perceived quality of healthcare provision in the public sector,'' he told IPS.
To make matters worse, certain sectors of the public healthcare system were privatised or 'corporatised'. In 1993, the procurement of medicines for government hospitals and clinics was privatised to a politically well-connected firm. The result: the cost of medicines doubled the following year.
In 1996, five more areas - laundry, cleaning, equipment maintenance, waste disposal and facilities maintenance of general hospitals - were privatised to three other firms. Total costs for these services jumped from RM140 million (36.82 million U.S. dollars) in 1996 to RM450 (118.3 million U.S. dollars) the following year.
''They have created a monster that has bled the public sector dry,'' said Jeyakumar, adding that privatisation and the emergence of private hospitals was a big mistake. ''You can't put the genie back into the bottle.''
The new insurance scheme will also have to take into account the 5,000 clinics, mostly centred in urban areas, run by private general practitioners, who treat a host of common ailments.
''How they would operate under the proposed scheme, nobody knows?'' asked T Jayabalan, a private general practitioner deeply concerned about equitable access to healthcare for all.
He worries that the government might be forced to back-pedal after implementing the scheme, leaving a trail of chaos in its wake.
The government says that it cannot cope with the rising costs of healthcare and there is a need for restructuring. Part of this, it argues, is due to the changing patterns of disease - from communicable disease in the past to serious illnesses such as cancer and cardiac problems, for which treatment is costlier.
The rising demand for quality healthcare and sophisticated equipment is also another factor.
But expenditure on healthcare in Malaysia has traditionally hovered around three percent of GDP, well short of World Health Organisation recommendations of five to six percent. Despite inadequate funding, government hospitals have performed impressively, if the vital health indicators for the population are any indication.
The new national insurance scheme, however, will reportedly ''prepare specialised packages for members who want better service'', which will probably give more options to those who can afford it.
This is precisely what rankles campaigners like Subramaniam who want the proposed scheme to provide one common package with comprehensive coverage for all regardless of income levels.
''No private insurance must be allowed for the conditions covered in the basic package,'' he stressed, adding that payment for the poor must be subsidised and equitable access must not be denied by imposing large co-payments.
What makes it difficult for concerned doctors such as Jayabalan is the level of public apathy and ignorance about the proposed scheme. "The public is totally unaware of what is going on," he lamented.