Malaysian
Health Reform Socio-Economics V
Dr David KL
Quek
[Published in The Malaysian Insider, 11 Feb 2012]
Why the need for Health Reform now?
This
is the question that has been posed by many people. What indeed are the key
reasons for the government to embark on such a radical transformation of our health
system? There is no easy answer. But I would venture some socio-economic and
health economic possibilities.[1]
Although
one cannot discount or exclude political reasons or even patronage-linked
considerations, I would not wish to embark on this line of speculation, because
essentially this would only detract from the real issues at hand. Also, it
would be hard to prove what are at best, innuendoes and almost surely shaped by
partisan motives and beliefs. But it would also certainly be impossible to allay
public fears and anxieties that these sorts of political interjections might
play a role in any government policy makeovers. So perhaps, these possibilities
should at least be highlighted so that they might be forewarned and prevented
from hijacking such a monumental policy shift for personal or partisan reasons.
Major
reasons for this proposed health reform are: widening public-private disparity
in healthcare delivery; attempt to slow down rising healthcare costs;
government policy shift to reduce health care subsidy; implementing W.H.O.
mandate to provide so-called universal coverage for health; social health
insurance to tap into another copayment mechanism for healthcare payment; and
forming an autonomous national health authority.
Widening Public-Private disparity in health care delivery
I
think that thus far, perception-wise there appears to some official discomfort
that the two disparate arms of our health system—one publicly funded and the
other privately so—seem to be widening in their capacities and efficiencies at
delivering health and medical services.
Perhaps,
there is that unspoken belief even among the government officials that the
privately funded sector appears to be superior or at least more effective at
delivering healthcare for the public, albeit at a higher price. But, the health
ministry has seldom, remotely and reluctantly acknowledged this. Instead, there
have been highlighted public complaints of exorbitant charges, costs, or other
mistakes on the part of private facilities so much so that a raft of special
laws had been enacted to regulate them, i.e. the Private Healthcare Facilities
and Services Act (1998) and the Regulations (2006).[2]
There have also been raised concerns that GPs are poor at chronic disease
management, which many private doctors have debunked and found discriminatory
without proof.[3]
Yet,
we know that the public sector health care delivery has been at best checkered
and often notoriously congested, that its efficiency has been called into
question time and time again. Considering the huge volume of patient turnover
seen by the public health sector vs. its limited resources and bureaucracy,
this is not so much a criticism, but a reality-based commentary. I believe that
under the circumstances, the public health sector is functioning the best it
could, although one can argue that there is much that can be improved and made
more effective and productive. Moreover, staff and personnel migration to the
private sector has caused difficult manpower and expertise problems at maintaining
competency and safety of medical services for the less-endowed public users of
these services.
So
like it or not, there is in reality some inequity in access, where the public
sector patients appear to have a lesser or more delayed (possibly less senior
and/or experienced specialist care) access to some of the more special medical
or surgical services.[4] Such a
disparity to a certain extent, poses some degree of unfairness on the system as
a whole, and creates perhaps a 2-tier approach for our patients—one for the
poor and the other for the better-off.
So
there is this wish to consolidate and streamline the system so that these two
streams could be integrated to provide greater ‘solidarity’ for our rakyat
without the need to consider the ability to pay. This seems to be the ideal.[5]
But in reality perhaps this is pushing fairness and equality too much. As I
have tried to explain, our system has indeed an inbuilt pro-poor mechanism that
is progressive, relatively fair and to some degree based on cross-subsidisation
on the part of those who can afford to pay more in the private sector.
Conversely, the government and the public sector cater to those who are poor or
who have less disposable household income, albeit with some inconvenience and
possibly some unavoidable delays due to rationing economics and triaging of
services based on need and urgencies.
Attempt to slow down rising costs of healthcare
There
can be no denying that healthcare costs are rising everywhere. The question is
whether this health cost escalation is more disproportionately so in Malaysia.
I have argued that this is not altogether true. Most Malaysians can afford our
current healthcare services—each according to their means—although sometimes
begrudgingly!
We
have relatively low household expenditure on necessary or catastrophic
healthcare services, with arguably the lowest tendency toward medical
bankruptcies in the entire Asia Pacific region.[6]
So the fear that our relatively high out-of-pocket (OOP) payments for
healthcare is probably unfounded and not based on the research data available.[7]
I would challenge our health officials to provide proof that we indeed have a
problem with excessive OOP payments that contributes to household
impoverishment.
Perhaps
more realistic is the policy-shift by the government to consider healthcare as
a capital-intensive and resource-consuming ‘unproductive’ economic activity, so
much so that the budgetary allotments appear to be reaping low or no returns.
Increasingly there has been official talk that this healthcare budget is too
much of a ‘subsidy’, which could be reduced in fiscal monetary economics
consideration. I argue that this is actually a government prerogative to
provide as a mandatory social good, as part of all good civil governance. This
is a must in ensuring the basic tenet of human rights to health! The 2% of GDP
spent on healthcare, I would argue is a necessary social good, which the public
demands. More should and must be allocated.
Government policy shift to reduce health care subsidy
The
budgeted amount for health care is simply too low.[8]
It is argued that the lack of concomitant increase in allocation from
government tax revenues over the years, is what has made that proportion of
health care spending appear as if there was a huge surge in out-of-pocket
spending for the individual or household. Of course, this is reflected and
stimulated by the stupendous growth in our private sector healthcare, which was
encouraged by the government since the mid 1980s. Overall, there is widespread
belief that there is gross underfunding on the part of the government. And that
this contributes to the lower morale and lesser competencies of the public
health sector.
I
have elaborated at length that we have to seriously explore alternative
approaches to health equity for Malaysians, where out-of-pocket, OOP payment is
just one aspect. Taken together with other health economic parameters and
analyses, our health system to date appears ‘progressive’ (i.e. fair and
equitable) in terms of health financing options and mechanisms. Of course, the system can and should be
improved, but this might simply require some elaborate and painstaking tweaking
rather than a wholesale revamp!
Indeed,
will the proposed de facto ‘socialisation’ or corporatisation of our health
care systems through the proposed integration of public-private sectors, be the
correct mechanism to forestall the trajectory of escalating health care costs, while
promoting health care access and equity as envisioned by the government?[9]
Or,
would allocating or injecting more public funds into the public sector to boost
services be the more immediate and more cost-effective approach towards
increasing universal access and widening the already available basket of
services to the public, at little or no cost? After all over several decades
now the government has only been spending just around 2% of the nation’s GDP
toward health care. What if this allocation were to be increased to say 4%,
even it this means diverting or cannibalizing some funds from other areas such
as defence, or other non-critical services?
Healthcare
subsidy would almost certainly benefit more people as a whole, while increasing
healthcare accessibility without the threat of inability-to-pay. Our public
increasingly feels that our tax revenues could be put to better and more
sensible use, and would certainly welcome such an increase in healthcare
funding.
I
believe the public will consider this as a generous bequest from a prudent and
caring government. This will stimulate growth and capacity for the public
sector and probably strengthen the delivery of services to the public
especially those in the lower income stream, so as to narrow the perceived gap
of public-private disparities. When this sector is improved, the private sector
would be forced to compete even more aggressively and cost-effectively so that
overall, the delivery of health services across the board would be enhanced!
So
what about this obsession with our out-of-pocket (OOP) payment for health being
too high? I am not particularly impressed about this risk, taking into
consideration the peculiarities within our Malaysian health system.
Can
medical bankruptcies or impoverishment be prevented if our out-of-pocket
payments are reduced enough, through another mechanism of healthcare
reimbursement plan i.e. an additional compulsory tax of sorts, via the social
health insurance? Other neighbouring countries such as Singapore have even
higher OOP payment percentage but have done well.
W.H.O.’s recommends Primary Care-led Universal Coverage…
This
appears to be one of the main reasons, our health officials feel we should show
solidarity with global aspirations. However, the W.H.O. is essentially more
concerned about universal coverage and access to health care for the underdeveloped
nations around the third world. Arguably these levels of development of health
systems have been way below our own. These arguments generally do not apply to
the more developed first world nations.
The
different W.H.O. officials whom I have met and discussed with have also
cautioned against too drastic a health reform, urging instead for more public
consultations, systematic pilot projects as well as improving tailored systems
and delivery based on our strengths. Some have urged for graduated evolution of
reform because there is no system the world over that is the right one for
healthcare delivery. Local and regional conditions and peculiarities should be
considered and factored in.
In
fact Dr Margaret Chan, the W.H.O. Director-General has said that ““no single mix of policy options will work
well in every setting… Any effective strategy for health financing needs to be
home-grown. Health systems are complex adaptive systems, and their different
components can interact in unexpected ways. By covering failures and setbacks
as well as successes, the report helps countries anticipate unwelcome surprises
and avoid them. Trade-offs are inevitable, and decisions will need to strike
the right balance between the proportion of the population covered, the range
of services included, and the costs to be covered.” Thus, no ‘one-size-fits-all’
model exists for the perfect health care system![10]
It
is true however, that the W.H.O. has been big in urging for a primary care-led
health delivery system.[11]
This is underpinned by economic considerations that the primary care-led health
initiative can help slow the trajectory of healthcare costs, by serving as a
gate-keeper and helping to ration healthcare to meet finite healthcare
resources. It is argued that when patients have unfettered access to secondary
and tertiary care at will and on demand, specialist care often trumps cost
considerations because, health needs almost always carry unregulated individual
moral hazards and conflicts of interests!
Moreover,
with the primary care-led system, some degree of orderliness and rationing can
help provide at least a modicum of basic healthcare services for everyone, the
quantum or the size of the basket of services would necessarily depend on the
capacity of the state to provide, but would need constant negotiated
enhancement over time.
What
about for Malaysia? Our GP services already cater to about 62% of all the
primary care needs of the population, even if this was via OOP payment
mechanisms; while the public outpatient clinics cater to the other 38% of the
poorer population. If the public clinics cannot cope with the patient load, it
has been argued that the GPs should be roped in to help provide the
decongesting exercise. The public sector can actually purchase GP services to
help offload the patient congestion at public institutions. This is actually
the mechanism of healthcare partnership in most of the European health systems
from France to Germany. It is in the finding of workable solutions and
bureaucratic reimbursement mechanisms that is at present holding back this
potential partnership.
Social Health Insurance and Authority, another GLC?
What about having a social health insurance
at this point in time? Are Malaysians ready for this form of individual or
family-group taxation i.e. contributing towards a community-rated health
insurance scheme, which will be run by an appointed autonomous authority that
will control and disburse all funds from ‘womb to tomb’ for all health-related
problems? Not every health policy expert agrees that SHI is superior to
tax-based health payment mechanism, indeed SHI have many detractors.[12]
Many countries such as Australia, Canada, Finland, Ireland, New Zealand and the
United Kingdom have maintained predominantly tax-financed systems since the
1960s. In fact, the NHS of UK is almost 88% funded from tax revenue
allocations. Other countries that have maintained a SHI system since the early
1960s, includes Austria, Belgium, France, Germany, Japan, Korea, Luxembourg,
Mexico, the Netherlands, Switzerland and Turkey. One major criticism about the SHI model is
that healthcare spending per capita tends to rise more than tax-based health
systems, although achieving less coverage.[13]
These gaps and inequalities in coverage
in SHI systems are likely to translate into inequalities in per capita health
spending, which in turn produce below average levels and delivery of health
care. In fact, some countries improve their universal coverage only when they
switch more toward tax-based systems of health financing, e.g. southern
European countries.[14]
Are
Malaysians ready to relinquish control of their health dollars to an
independent authority, which is sanctioned by the government? Is this one other
form of a GLC (Government-linked corporation), which could potentially be an
affirmative-action patronage-linked connotation? This is not likely to persuade
many Malaysians towards its acceptability. Why empower another huge
conglomerate, where we cannot control, but which can limit our choices while
also costing us more immediately?[15]
Can
we accept perhaps a more limited and constrained version of health care access,
but which would provide a modicum of guarantees against the vagaries of
catastrophic illness, so that as a whole, our eventual health care costs would
be lower in the long run?
Can
we accept that there might even be some reduction in the basket of healthcare
services, medicines or therapies, which are deemed too costly or not ready to
be included? How much copayment would we be willing to accept while we are
already mandated to contribute some percentage of our wages toward this Social
Health Insurance?
Would
Malaysians become more patient and accepting that some non-urgent medical care
might not need to be sought immediately, every time? That, many ailments could
be safely waited upon, albeit with some slightly prolonged discomfort and
possibly pain, so as to preserve and spare our finite healthcare resources more
efficiently?
Malaysians
would have to learn and accept that this is the usual response time for most
ailments, which are non-medical emergencies. But changing such ingrained
mindsets take time, and would need the appropriate inculcation of values and
buy-in options from the public. It would be foolhardy to push through such
radical reforms that could potentially disrupt our hitherto vaunted and
respected even if imperfect, health services!
Are Alternative Health Reforms Possible?
Perhaps,
we should work towards some structure of reform in a more gradual manner. Let
the system evolve by setting up pilot projects of change first within the
already hugely subsidized public sector. For our civil servants and their
dependents, they could be absorbed into this enhanced system, where the general
government revenues can be allocated more concretely. Perhaps, the government
could start some SHI model at the same time, thus involving some 1.2 million
civil servants and their dependents, to see if this manner of co-contribution
to some risk-pooling insurance could work well.
Other
private sector companies would necessarily be viewing this development with
keen interests and they too could be incentivized to participate or join in
voluntarily, if and when they see the practical and cost-benefits of the ‘new’
system, for their own employees. However,
we must caution that they should not be coerced into accepting some basket of
health services for their charges, which are inferior to what is currently
available--change must be for the better and not the other way round! It is
critical that the transformed public sector is seen to function seamlessly and
competently, so that those outside its reach would feel justified that this is
the possible better option.
Currently,
most companies big and small, purchase some forms of company assisted health
insurance or some negotiated empanelling of GP clinic groups to provide
healthcare benefits for their employees. These have been serving most companies
well all this while. However, as with any new model it is possible that in
time, these companies could see the benefits and preference for the government
initiative. Then over some decades perhaps, this could be expanded to include
more and more of our citizens, because this is indeed the better way forward.
This would ensure gradual buy-in on the part of the public, when they can be
assured that the option of SHI is the best method of health care reimbursement
for most nations. But let the rakyat have that choice and make it themselves!
Implications and Concerns of Single Payer Gate-keeping Primary
Care
Malaysians
are accustomed to our current healthcare system where they can consult or even
change any doctor or specialist at will, when they fall ill. It is true that
sometimes this can be a costly exercise, which has led to duplication of
services, investigations and wastage of unconsumed medications and lack of
continuity of care.
However,
it is debatable whether these doctor hopping or shopping practices among some
of us, are such a major problem that we have be devise an entirely new scheme
to curtail this. Would this make much sense if only a small minority does this,
or is this simply a command or arbitrary health economic measure that the
government wishes to impose, just because it can?
Under the new proposed 1Care system,
unless deemed necessary and referred by a gate-keeping primary care doctor, any
other self-referral to another non-designated doctor or specialist would not be
reimbursable. In other words, you will be required to pay out of pocket if you
choose to bypass the new system, and see second or third opinions when not
referred by designated doctors. Remember that these doctors have been
contractually advised and are also controlled by the new authorities, to only
refer when they think is necessary, and that their performance or failure to
carry out some of these measures, might also not be reimbursed or might even be
penalized![16]
Knowing
the penchant for Malaysians to be quite critical and choosy, and in some ways
empowered, there is that distinct possibility that many people might continue
to do this and thereupon incur even more self-paying for services that they
demand. Can we wean the public out of this kind of thinking or practice? Or
should we allow the free market to determine and dictate the terms of reference
of how they can access their own preferred doctor, based on the concept that
our rakyat should have the right to decide and to choose?
What
if gate-keeping doctors fail to be as competent or as satisfactory as they are
supposed to be? Especially, when these designated doctors are often not from
personal or free choice. Would there be any recourse to any form of dispute
resolution or arbitration for change or complaint? Could this lead to
uncalled-for delay of diagnosis, treatment or even serious consequences, which
the system will tolerate? Would medico-legal challenges be allowed if
negligence and poor outcomes occur, and would patients have a choice to pursue
some remedial recourse for themselves or their loved ones?
During
the 2010 General Practitioner’s Summit, some 300-odd doctors spent 2 whole days
debating their roles and the merits and concerns about the proposed 1Care
health reform.[17] While most
agree on some consensus of supporting a primary care-led health system, many
were very concerned as to the scope and extent of the far-reaching reform
proposals. Gate-keeping might be an acceptable model to adopt to regulate
unwarranted access to specialist health care referral, but flexibility was
considered critical for the public to buy in.
There
were also fears of the mandatory social health insurance, the single payer system,
capitation or global budget fee arrangements, and the need for the GPs to be
under layers of bureaucrats whether family medicine specialists or so-called
quality or safety officers from different agencies, which could only increase
logistic as well as running costs! Ultimately there is fear that higher costs
of practices would be passed on down to the public and the patients.[18]
So,
are Malaysians ready to evolve into a system of healthcare, which is controlled
and restricted in large measure by a designated family physician or GP, i.e.
primary care-led, and an overarching National Health Authority? What about
checks and balances of misuse, abuse or simply technical glitches from venal or
incompetent practitioners or armchair medical managers?
These
are the concerns that are difficult to dispel. Because the possible limitations
of the proposed single authority could easily stifle access and promote
extraordinary expenses out-of-pocket for a sizable portion of our citizens, who
might find this single payer mechanism too tiresome and bureaucratic, what with
the enforced gate-keeping and possible inefficiency adding as a serious
stumbling block to free choice!
If it ain’t broke…
Again,
the system isn’t broke, and public acceptance of our current dichotomy of
services appears strong without the compelling need to change and/or abolish
this functioning system at this point in time.
With
an established private sector system in full flight, the 1Care reform plans
have cast distracting shadows on the future of private health facilities and
private medical practitioners. Are we resorting to some form of de facto ‘socialization’ or underhand
corporatization of our health services? Is this compatible with our free-market
economic practice, with our established concomitant and much vaunted public
health sector safety nets? Would this plan spook investors in the health care
sector? Would this also contribute towards more talent migration and capital
flight? Most importantly, would the public actually benefit or suffer more from
such a radical change?
Or,
is this an attempt to create another huge quasi-corporatisation exercise worth
tens of billions of ringgit? Still, is this reform going to concentrate all the
nation’s health resources into the reach and control of one mega-conglomerate or government-linked corporate body? Would
this once again stifle true competition and allow rent-seeking patronage
practices now so entrenched and yet so reviled by our enlightened citizens?[19]
There
is great fear that by concentrating all the power, the financing and the
discretion to access healthcare in the hands of one authority, many people
could be worse off, and might be shortchanged even further due to bureaucratic
or possibly biased practices and flawed implementation. Ironically as feared by
many, we might be forced into paying more than we have to date, and yet might
get much less in return for our healthcare needs, in the so-called reformed
future!
Preferential
and selective referrals or designations of primary care doctors are also feared
possibilities, in sharp contrast to our current approach where this is decided
by free choice. To make matters worse, if one bypasses this gate-keeper pathway
to healthcare (which we fear will happen, if dissatisfaction, glitches and
delays occur with the new system), then one is saddled with having to pay
out-of-pocket once again, thereby defeating the premise of why this reform is
needed in the first place. Excessive out-of-pocket (OOP) payment is one of the
major why’s the proposed health reform is touted to be necessary in the first
place, the aim being to abolish or reduce this aspect of reimbursement!
So
perhaps for once, before this actually materialize, the public must be
protected from poorly conceived and potentially commandeered plans to benefit
questionable parties, which could drastically impact Malaysians for the worse!
There
remains serious confusion, uncertainties and huge but foreboding unknowns
pertaining to the proposed health reform of 1Care. If our system ain’t broke,
don’t change it so drastically so as to make it potentially much worse! For
goodness sake, please for once, listen to the people![20]
[1] Peter
R. Orszag, Ezekiel J. Emanuel. Health Care Reform and Cost Control. N Engl J
Med 2010; 363:601-603 August 12, 2010
[2] Private
Healthcare Facilities and Services Act (1998), and Regulations (2006) (P.U. (A) 137/2006). PCNB, Malaysia.
[3] Dr Jayabalan
T and others, The Star, 07 January 2010, pg N45
[4] Khoo EM et
al. “Medical Error in MOH Primary Care
Clinics”, Institute of Health Systems Research, 2008
[5] Francis
J. Crosson. 21st-Century Health Care — The Case for Integrated Delivery
Systems. N Engl J Med 2009; 361(14):1324-1325. Oct 1, 2009
[6] Xu K, Evans
DB, Kawabate K et al. Household catastrophic expenditure: a multicountry
analysis. Lancet 2003; 362: 111-117.
[7] Van
Doorslaer E, O’Donnell O, Kannan-Eliya RP… Chiu Wan Ng, et al. Catastrophic
Payments for health care in Asia. Health Economics, 2007; 16 (11): 1159-1184.
(Doi:10.1002/hec.1209)
[8] William Savedoff. Tax-Based Financing
for Health Systems: Options and Experiences. WORLD HEALTH ORGANIZATION. GENEVA 2004; pgs
12-16.
[9] Victor
R. Fuchs. Government Payment for Health Care — Causes and Consequences. N Engl
J Med. December 2, 2010;363(23):2181-2183.
[10] The World
Health Report 2010: Health Systems Financing—The Path to Universal Coverage, W.H.O.,
Geneva, 2010.
[11] The World Health Report 2008: Primary Health Care (Now More Than Ever). W.H.O., Geneva, 2008
[12] Adam Wagstaff.
Social Health Insurance vs. Tax-Financed Health Systems—Evidence from the OECD.
The World Bank, Development Research Group. Human Development
and Public Services Team. January 2009.
[13] Wagstaff, A. (2007). Social health insurance reexamined. Washington
DC, World Bank. Policy Research Working Paper # WPS 4111.
[14] Carrin, G. and C. James (2005). "Social Health
Insurance: Key Factors Affecting the Transition Towards Universal
Coverage." International Social Security Review 58(1): 45-64.
[15] Yow Hong Chieh. Double taxing the public via 1 Care. The Malaysian
Insider, February 05, 2012. http://www.themalaysianinsider.com/sideviews/article/double-taxing-the-public-via-1-care-yow-hong-chieh/
(accessed 5 Feb 2012)
[16] A Better Malaysia. Shocking proposal for 1 Care 10pc levy. The Malaysian Insider. February 09, 2012. http://www.themalaysianinsider.com/sideviews/article/shocking-proposal-for-1-care-10pc-levy-a-better-malaysia/
(Accessed 9 Feb 2012)
[17] Quek DKL, Thuraiappah DM, Sudhananthan K (eds.). General Practice Conundrum: GPs at the Crossroads (Memorandum of
the Primary Care Coalition Providers Malaysia). April 2011, Malaysian Medical
Association, Kuala Lumpur, 2011.
[18] Quek DKL. The GP Conundrum—Whither the future, MMA
News, Feb 2010, pg4-7
[19] T.
Jayabalan. 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)
[20] The Black Cactus. The 1 ‘S’Care scheme. The Malaysian
Insider, February 08, 2012. http://www.themalaysianinsider.com/sideviews/article/the-1-scare-scheme-the-black-cactus/
(Accessed Feb 8, 2012)
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