Malaysian
Health Reform Socio-Economics I
Dr David KL
Quek
(Published in The Malaysian Insider, 7 Feb 2012)
Is
the Malaysian health system really in trouble that it requires such a drastic
revolutionary change? Is 1Care for 1Malaysia Health Reform the answer? Will
this proposed radical change make our health system more efficient and
effective as touted by the officials?[1]
Or,
is this proposed Reform too ambitious and sweeping, that it could possibly lead
to severe disruptions to our current health system that we are so used to?
More
importantly, would this health reform plan become another government-linked
corporate entity, which instead of benefiting the public only enriches a few
favoured cronies or insiders?[2]
The difference now, is that, this will be a humongous multibillion-ringgit
exercise and the fattest cow to milk to date!
Sadly,
at this juncture in time—in the name of social development, modernization, and
economic necessity even—there have been so many government-linked projects
being scandalized and mired in corruption accusations and profligate leakages.
Thus,
it would be foolhardy to implicitly trust in the government to do the right
thing, despite the economic rationale or correctness, indeed despite even the
most honourable, intentions! We are dealing with the health choices and rights
of the public, which could become severely disrupted and endangered if or when
hurried reforms turn out to be another debacle of catastrophic proportions! We
cannot afford a failed social experiment of this magnitude!
Economics and Health Care Rights
Let’s
examine the proposed 1Care Health Reform. What indeed is this new concept that
we are dealing with? The Ministry of Health has stated and defined the
objectives of this 1Care transformation as follows:
“1Care is
the restructured national health system that is responsive and provides choice
of quality health care, ensuring universal coverage for the health care needs
of the population based on the spirit of solidarity and equity.”[3]
Theoretically, the above concept is a fully
acceptable ideal. But it should not become just a neat slogan. Everyone should
have equitable access to health. No one can or should deny this universal
premise. No one should be disadvantaged or discriminated against when compared
to another just because of his or her ability to pay more, or who can afford
more. Most importantly, no one should ever be denied life-saving or symptom- or
pain-relieving medical care just because of cost considerations. In reality
however, this is not so simple.
Those who can afford to pay more would almost
surely be able to purchase health and medical care at will, just because this
is the way the free market works. Those who have more disposable or
discretionary income and means, almost always have a greater purchasing power
to a wider variety and urgency of goods and services. This applies to every
economic sphere and not just for health care. That is the way of world these
days. Most people except perhaps those living in command socialist economies
accept some degree of ease or disparity in their capacity to access healthcare,
according to their individual means. This is socially unfair but also universal
in its reach.
But again this is an undeniable truism, despite its
distasteful and off-putting implications: the less endowed or less informed are
almost always less demanding and have lesser recourse to demand or to expect
more for any services or goods. If you earn more and have more money, you are
able to afford more goods and services (sometimes known as ‘utilities’). If
not, you would have to sacrifice not just the more luxurious aspects of the
accompanying extras, but sometimes, even forego some basic necessities!
Thus, those who wish for more goods and services
would have to work doubly hard and to strive harder when given a chance to
gain, earn or excel. In competitive society, everyone is expected to achieve
productivity for themselves to the best of his or her abilities. However, the
playing field is often uneven and is never equal. Therefore the inherent
inequalities of income and lifestyle must be considered, when we wish to
examine how fairly society provides goods and services for its citizens. This
is particularly relevant when we consider healthcare services for society at
large.
It is now well accepted that modern free-market
society expects every individual to strive to provide for him/herself in the
spirit of self-interest and self-betterment. Free competition would arguably
allow the best and the most able to achieve more and thus provide the impetus
for self-achievement and wealth accumulation. Free market economics imply that
society as a whole will be able to lift itself up by its own bootstraps, to
ever higher levels of development, both socioeconomically as well as in terms
of human development, so it is believed.
Increased wealth, unequal as this may be
concentrated in the hands of some or a few, will somehow trickle downwards so
that most of society at the various strata would benefit or reap some rewards,
for themselves and their families. This creates ‘healthy’ competition as well as
competitive behaviour, which some argue contributes toward faster societal
progress, because self-interests and individual desire for goods/services,
almost always trump communal or other interests, outside the self or family.
But clearly there is a down side to this laissez
faire market economic model. Increasingly we know that the rich and the
powerful have grown ever richer and more powerful, and poverty appears to
entrench and deprive the poor even more tenaciously than before in the poverty
cycle—so much so that the wealth gap widens inexorably. The poor and the
have-nots continue their inescapable slide down the poverty trap—the spiral of
marginalization, impoverishment and deprivation, whilst the rich grow ever
richer.
Difficult as it is to consider, that is what the
globalised world has now become—more and more market- and consumer-driven and
more individual-focused. The wealth gap or income disparity between the rich
and the poor (or GINI index[4])
continues to widen and serve as a serious challenge for governments worldwide.
Although with rising GDP growth, some benefits do
trickle down to reach the lower strata of society, disgruntlement and
discontent among society’s underbelly of the aggrieved and dispossessed, often
strains society’s stability and fester public dissatisfaction. Worse, if the
poorer segment of the population continues to grow and widen—this socially
unjust disparity between the haves and the have-nots could be destabilising and
could cause serious class conflicts.
Thus, there have been growing research and studies
into the economics of income inequality, with many different models and indices
being developed to try and describe these as close to reality as possible.[5]
It is hoped that these indices can help focus efforts to reduce these gaping
inequalities as well as perceived inequities and perhaps develop better
socioeconomic strategies and paradigms toward achieving greater social justice
and cohesion.
Therefore social reform, which can eliminate or
reduce such disparities, is always welcome in the name of social equity and
fairness. Clearly this applies to healthcare discrepancy as well. So some
reform is in order, at least nominally to reduce the gap of accessibility and
perhaps too, to staunch the falling standards of health care. Just how this is
to be realised is somewhat contentious, and the details of the government’s
proposed reform remain unclear, and need to be better fleshed out. Here are
where many outside the ambit of the Health Ministry and the policy makers, find
grave disquiet, disagreements and contentions.[6],[7]
Universal Coverage—the ideal health
care goal[8]
Health financing options for any particular
country, are determined largely by the stage of its economic development—the
poorer or less developed the country, the more likely it is for healthcare
financing to be dominated by out-of-pocket payment options—healthcare is
considered to be a luxury, instead of being a right or a privilege of being a
citizen, a resident or a taxpayer.
For the poorer nation, there is normally no social
protection against ill health, because out-of-pocket payments create financial
barriers that prevent the poor from seeking and receiving needed health
services.[9]
Which is why, our own pro-poor almost fully-subsidised public health system has
been acclaimed and acknowledged as one of the best around the world, and not
just for the developing world! Many underdeveloped nations have sent many
cycles of delegates to learn from our much emulated public health system. So
the premise that we are doing poorly in terms of healthcare is a myth, we are
not. Of course, this is not to say that our health system is beyond reproach or
improvement. There is much that can be made better.
Universal coverage as a guarantee for most if not
all citizens is usually only provided by more developed or socially enlightened
economies. But the mixes of payment options vary tremendously, with the more
mature and socially equitable nations offering more tax-based or strictly
demarcated or allocated social insurance for health. But such overall taxes
tend to be very high and approach close to 50 percent or more of earned
incomes. Their tax bases are also broader, usually more than 70% of the working
populations are taxpayers, which enable such governments to implement collection
mechanisms such as dedicated health insurance on a more inclusive and more
comprehensive risk pooling (community-rated) manner. Examples include the
Scandinavian countries of Norway, Sweden and Norway, and Canada and Australia.
Countries such as the United Kingdom are ‘blessed’
in that a National Health Service was implemented decades ago, just after the
Second World War, before free-market capitalistic practices have become
entrenched. Other European countries have health systems, which are largely
dominated by centrally controlled single-payer healthcare services with a
sprinkle of private offerings for the wealthy. But most of these centrally
controlled systems evolved over decades, often taking even longer than 50
years.[10],[11]
For the more recent experiences of Taiwan, Thailand and South Korea, this
evolved over the past 30 years, also through fits and starts. Despite this,
health and medical care are often purchased services from private entities by
the central authorities based on negotiated reimbursement plans, and varying
copayment options to decrease overutilization of services, and ameliorate moral
hazards.
The USA is somewhat of an anomaly among developed
economies in that it follows a free-market system of free choice and self- or
employer-purchased insurances or managed care (MCOs) or health maintenance
organisation (HMOs) options (to provide what is popularly known as managed
competition). Unfortunately, this has failed to stem the tide of healthcare
cost escalations, which has now exploded to a hefty 17% of its GDP (some 2.8
trillion USD!) and its famously lack of universal coverage for its teeming
uninsured—this number has now reached 47 million of its 300 million population
(some 16 % of the population!).
This is also why the World Health Organisation (W.H.O.)
has been pushing every nation towards achieving this goal of universal coverage
for all.[12]
But this implies that governments, policy makers and the public are enlightened
enough to agree to and allocate sufficient tax revenues toward health care, as
well as to agree to some form of cost-sharing and risk-pooling. They must thus,
also agree to the imposition of mutually-acceptable or negotiated social health
insurance schemes to cover all the residents within their borders.
Universal coverage implies secure access for all to
appropriate promotive, preventive, curative and rehabilitative health services
at affordable costs. Besides financial risk protection, the extent of the
population covered (e.g. who is covered) and the extent of health service
coverage (e.g. what is covered) must also be properly defined, although this
must clearly fit within the framework and context of affordability and means.
It therefore implies that governments provide sufficiently
robust systems of emergency, catastrophic care and safety net services, so that
the indigent and those impoverished can still partake of the health services
without unnecessarily having to delay, to choose, or to sacrifice basic
essentials for health, or vice versa. In other words, such barriers to
healthcare access must be eradicated for as many people as possible, if not for
everyone.
It further infers and probably necessitates that
the country’s tax collection practices are mature, socially redistributive and
reasonably equitable, so that the majority of the population can be adequately
covered. Perhaps one of the most important considerations from the point of
accountability is that administrative and service costs should be kept as low
as possible, and not be allowed to bite into the already limited funds for
whatever healthcare programmes!
[1]
http://www.lepak.tv/watch/323b07e591c9ff3/1Care-for-1Malaysia-health-systemTrust
[2] Chan Chee-Khoon.
Privatisation, the State and Healthcare Reforms: Global influences and local
contingencies in Malaysia. 4th GASPP Seminar on Global Social
Policies and Social Rights? New Delhi, India Nov 8-10, 2000. http://gaspp.stakes.fi/NR/rdonlyres/9543986B-3E29-42CD-8088-F3992A2B48F2/0/chan.pdf
(accessed 3 Feb 2012)
[3] Ministry of
Health. Health Systems Transformation: 1Care for 1Malaysia. Jan 2011
[4] Gini
Index or coefficient, measures the degree of income
inequality in a country. Gini index is calculated from the Lorenz curve, where
cumulative household income is plotted against the number of families arranged
from the poorest to the richest. Malaysia has a Gini Index of
46.2, similar to USA of 46.9 in 2009. http://www.indexmundi.com/malaysia/distribution_of_family_income_gini_index.html
[5] Fernando G De Maio. Income inequality measures. J
Epidemiol Community Health 2007;61:849–852. doi: 10.1136/jech.2006.052969
[6] Steven KW
Chow, Ng Swee Choon, Federation of Private Medical Practitioners Associations
of Malaysia (FPMFAM). 1Malaysia Healthcare – Transforming For The
Better Or Worse. 3 May 2010. http://fpmpam.org/content/presidents02.html
(accessed 8 Jan 2012)
[7] Silent move to push 1Care will burden the rakyat, says
activist. http://thethirdeye.posterous.com/press-statement-silent-move-to-push-1care-wil
(Accessed 25 Jan 2012)
[8] Guy Carrin, Inke Mathauer, Ke Xu, David B
Evans. Universal coverage of health services: tailoring its
implementation. Bulletin of the World Health Organization. 2008; Volume 86, Number 11, November, 817-908. http://www.who.int/bulletin/volumes/86/11/07-049387/en/# (accessed
25 Jan 2011)
[9] Preker A, Langenbrunner J, Jakab M. Rich-poor differences in health care
financing. In: Dror D, Preker A, eds. Social re-insurance - a new approach
to sustainable community health care financing. Washington, DC: The World Bank;
2002.
[10] Barnighausen T, Sauerborn R. One hundred and
eighteen years of the German health insurance system: are there any lessons for
middle- and low-income countries? Soc Sci Med 2002; 54: 1559-87 doi: 10.1016/S0277-9536(01)00137-X pmid: 12061488.
[11] Carrin G, James C. Social health insurance:
key factors affecting the transition towards universal coverage. Int Soc Secur
Rev 2005; 58: 45-64 doi: 10.1111/j.1468-246X.2005.00209.x.
[12] Sustainable health
financing, universal coverage and social health insurance [A58/33]. Geneva: WHO; 2005.
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