Where Did Health Ministry’s ProtectHealth Corp Get RM26m?

By CodeBlue | 13 May 2019

PHCorp’s share capital increased to RM1 mil in 2017 and RM26 mil in March 2018.

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KUALA LUMPUR, May 13 — A doctor questioned how the share capital of government-owned ProtectHealth Corporation Sdn Bhd (PHCorp), an initial RM2 company which manages the Peka B40 health screening scheme, rose to RM26 million in March 2018.

Former Malaysian Medical Association (MMA) president Dr Milton Lum also pointed out that according to PHCorp’s registration on the Companies Commission of Malaysia (SSM), the directors of PHCorp are the Ministry of Health’s (MOH) current secretary-general Dr Chen Chaw Min and current director-general Dr Noor Hisham Abdullah.

“How can the regulator regulate itself? If it is the latter, is it in compliance with the government’s rules on directorships of GLCs (government-linked corporations)?” Dr Lum questioned in his column on CodeBlue.

He pointed out that according to SSM documents, PHCorp was incorporated on December 19, 2016, as a private company limited by shares with an initial share capital of RM2. The share capital was RM1 million as at December 31, 2017, before it increased to RM26,000,002 on March 21, 2018, shortly before the May 9 general election.

“Disclosure of the source of these monetary changes are needed, especially with claims that the public health sector is underfunded,” said Dr Lum.

He also cited SSM documents that stated PHCorp’s nature of business as “medical and health insurance / Takaful including establish and operate any kind of health financing mechanism”.

Peka B40, which is administered by PHCorp, does not provide health insurance; it provides free health screenings for the bottom 40 per cent (B40) aged 50 and above at private facilities, medical equipment aid, incentives to complete cancer treatment, and transport aid to go to hospital. The RM100 million scheme was only launched last April 15 by the new Pakatan Harapan (PH) administration.

“The question arises as to whether PHCorp has a licence from Bank Negara,” said Dr Lum.

“At the meeting on 10 January 2019, the Health Ministry informed the representatives of the medical associations present that doctors had to reach out to the B40 to get their participation in Peka B40.

“If that is still the current stance of the Ministry, would such doctors be considered insurance agents with all its attendant implications?”

Dr Lum also insisted that PHCorp — which is described on its website as a wholly-owned non-profit subsidiary of ProtectHealth Malaysia that was established under MOH — was “prima facie” a managed care organisation (MCO), according to the definition under Section 82 of the Private Health Care Facilities and Services Act (PHCFSA) 1998.

“Although the Health Minister has claimed that it is not, it appears that he has not been advised that there is no provision in the PHCFSA for him to exclude an organisation from being defined as a MCO.

“The question that arises is how can the Health Ministry regulate its own GLC.”

PHCorp’s website states that the company, described as ProtectHealth and not PHCorp as initially used by the ministry, is not an MCO, but a “health care scheme administrator” for Peka B40.

“As a not-for-profit company, ProtectHealth coordinates, administers and manages initiatives related to financing health care services as mandated by MOH,” states the website.

PHCorp’s stated nature of business in health insurance is not surprising given that the previous Barisan Nasional (BN) administration had tried but failed to implement a social health insurance scheme called 1Care due to public opposition. The new PH government also says that the current health care system is increasingly unsustainable, but stops short on whether it too will move towards social health insurance.

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