Cutting cost of private healthcare can drive investors away, says group

 

Association of Private Hospitals Malaysia president Dr Kuljit Singh says the increase in the cost of medical care is not endemic to Malaysia.  (AP pic)

PETALING JAYA: 

Reducing the cost of private healthcare services is no simple task, the Association of Private Hospitals Malaysia (APHM) said, citing the complicated relationship between profit and attracting investors.

The association’s president Dr Kuljit Singh said private hospitals in Malaysia have profit margins of between 7% and 11% after tax.

Such margins are comparatively lower than many other healthcare sectors, he said.

“Narrowing these margins further by reducing the cost of services is deemed unsustainable, potentially deterring investment in private healthcare,” he told FMT.

Kuljit said that in the long run, the lack of investors would be detrimental to the public healthcare system given that with lower investments in private healthcare, there would be fewer private hospitals to ease the strain on public hospitals.

Last week, a group of MPs from PKR claimed that the rising cost of private healthcare services was forcing those in the middle-income group to seek treatment at government hospitals and clinics.

They said this would exacerbate the problem of overcrowding at these facilities.

Bayan Baru MP Sim Tze Tzin said the rate increases were hurting the middle class whom, he said, could no longer cope with the high costs.

However, Kuljit said the increase in the cost of medical care was not endemic to Malaysia.

He cited an article in the Bangkok Post which reported that medical cost has been “skyrocketing” in Thailand since 2020 and is projected to increase by another 15% next year.

Kuljit said it would be better to enhance the public healthcare system instead, adding that it presented a more sustainable and equitable solution for the entire population.

“Public healthcare models can efficiently deliver services to individuals with no access to private healthcare, ensuring comprehensive care for all citizens without imposing restrictions on private healthcare, which could hinder the growth and sustainability of private hospitals,” he added. - FMT