Analyst Unperturbed By MOH’s ‘Small’ 1.5% Budget Raise

Chua Hong Teck says a higher allocation doesn’t necessarily equate to better health services and focus should be on more efficient use of resources in the Health Ministry.

KUALA LUMPUR, Nov 4 — Although the 1.5 per cent increase for the Ministry of Health’s (MOH) 2022 budget is not much, the overall allocation increase for the ministry over the past three to four years is substantial, said independent public policy and health care analyst Chua Hong Teck.

MOH’s overall 2022 budget of RM32.4 billion was minimally increased by 1.5 per cent compared to RM31.9 billion in Budget 2021. However, its allocation in the past three years has risen by 20 per cent or RM5.4 billion in total from RM27 billion in 2018.

Chua argued that higher allocation does not necessarily translate to better health services, especially in managing Covid-19. He cited the United States as an example where health care spending is at 17 per cent of gross domestic product (GDP).

“It doesn’t mean that if you spend a lot, you can manage the Covid better. For example, the US has the most Covid-19 cases per million people and most deaths per million people [despite their higher allocation per GDP].

“Meanwhile, countries like Bangladesh and Indonesia, which spend less than us, have fewer cases per million, so health care is more than MOH,” Chua told CodeBlue when contacted recently.

Instead of asking for more money, Chua said the focus should be to be more efficient and optimum in using resources within the MOH and working with the private sector. He cited Dr Margaret Chan, former director-general at the World Health Organization (WHO), who previously said that 20 per cent of health care spending was wasted through inefficiency.

“We should be more efficient in using the allocation given, we cannot just be asking for funds, but nobody wants to talk about that,” he said.

MOH’s RM32.4 billion higher budget in 2022 was primarily driven by a nearly 3 per cent increase in operational expenditure to RM28.03 billion from RM27.22 billion. Development expenditure was cut by about 7 per cent to RM4.38 billion from RM4.72 billion in 2021.

Chua attributed MOH’s lower development expenditure in Budget 2022 to cash flow requirements for physical development projects. He said 2022 would be the start of new physical development projects, while 2021 was to complete existing projects from the Eleventh Malaysia Plan (11MP). The development allocation has two components, physical and non-physical projects, and from 2021, some allocation has been shifted from the operating budget to the development budget.

According to the Estimated Federal Expenditure 2021 document for MOH, the allocation for Hospital Facilities (00300) in Budget 2021 was RM2.86 billion. However, Chua noted that the figure was later revised in the Estimated Federal Expenditure 2022 document to RM2.52 billion, a difference of RM340 million from the initial allocation.

The allocation for New Hospitals (line item 00400) also saw similar changes. Its allocation in Budget 2021 was RM366 million but was adjusted to RM261.6 million, over RM104 million less, likely due to delays and the retendering of some projects such as Petra Jaya Hospital in Sarawak.

Hence, the allocation for both items (line items 00300 and 00400) in Budget 2022, compared to Budget 2021, was reduced to RM2.59 billion and RM212.4 million, respectively.

The same can be said for ICT Facilities (line item 00800). In Budget 2021, the allocation for the budget item was about RM62.5 million, but this was later adjusted to RM11.48 million, just about 18 per cent of the initial allocation. Its allocation in Budget 2022 was brought down to RM41.22 million.

Many health experts, including Prof Dr Adeeba Kamarulzaman, had previously described the current health allocation in relation to GDP as “totally inadequate”, with Dr Adeeba calling for more investments into automation and digitisation of the health care system, among others.

“I worked at MOH for many years, most of the time the allocation is historical. Your allocation will remain the same at about RM100 million, for example, unless you can show there is a big rise in patient numbers or if management has agreed to some kind of project — only then a new allocation is given,” said Chua, who has also served as budget review officer at the Treasury.

On whether it is viable for budget allocations to move away from historical base rates, Chua pointed to how “Emoluments” (line item 10000) formed RM17.41 billion or more than half of MOH’s share in Budget 2022.

“People must understand that health care is labour intensive. Hospitals don’t close compared to the immigration department, registration department, agriculture etc.

“Apart from that, doctors, pharmacists, and dentists, they all have what is called time-based promotions, i.e. after a certain number of years, you get promoted. So obviously, a lot of money goes into that. So if you need to pay for all these salaries, there won’t be any money left,” he said, noting that this made it difficult to make fair adjustments across the board.

On if the minimal 1.5% raise to MOH’s overall budget will affect the way the ministry deals with backlog cases and non-communicable diseases (NCDs), Chua said it can be presumed that pooled allocations for Covid and non-Covid cases, as in the Medical Supply for Health Facilities, can be used for non-Covid cases as the impact of the pandemic eases.

“I guess the money is there because we can expect less spending on Covid. So, that allocation can be used for non-Covid. However, even if the allocation increases, can MOH cope? If we’re talking about surgery, there is only a limited number of operation theatres and a limited number of anaesthetists to go around,” he said.

Galen Centre for Health and Social Policy chief executive Azrul Mohd Khalib previously said that the 1.5 per cent increase to MOH’s budget gave the wrong impression that despite the Covid-19 crisis, somehow health needs and service delivery remain the same.

Nevertheless, he said Budget 2022 also includes a significant increase in the allocations for public health of more than RM200 million, benefiting areas such as disease control, health education and promotion, and family health development.

However, Azrul said the consolidation of the 20000 budget line Services and Supplies from each of the different disease programmes into Medical Supply for Health Facilities under the 080000 Specific Programmes, which occurred last year, remains problematic.

The consolidation prevents analysts, stakeholders and MPs from knowing the exact amount that has been allocated for treatment and care for diseases such as cancer, diabetes, chronic kidney disease, hypertension and cardiovascular, he said.

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