Six Years On, Middlemen In Private Health Care Remain Unregulated – MMA

MMA says third-party administrators (TPAs) remain unregulated. A number of TPAs charge private GP clinics registration fees of up to RM5,000 to be appointed as panel clinics. TPAs also practice fee-splitting, which is illegal in medical practice.

The Malaysian Medical Association (MMA) is deeply concerned over the unregulated operations and activities of Third Party Administrators (TPAs) or Managed Care Organisations (MCOs).

There are, to date, more than 30 TPAs under the Ministry of Health (MOH) registry.  They are the middlemen in managing employee medical benefits for employers.

A number of them charge private GP clinics substantial registration fees of up to RM5,000 just to be appointed as panel clinics. 

TPAs also obtain revenue through the practice of fee-splitting, either by reducing GP consultation fees or claiming a portion of these fees through deduction of the final settlement. In medical practice, fee-splitting is illegal.

Some TPAs even take a 10 to 15 per cent deduction from the total bill, which can potentially compromise patient care. These matters have been highlighted to MOH since 2015, and despite our many engagements on TPAs since then, no remedial action has been taken. 

Another matter of recent concern is the absence of monitoring of the TPA practice of outsourcing prescriptions of long-term medication (LTM) to pharmacists via e-prescriptions.

This practice poses risks to the health of patients on long-term medication and is not in line with the holistic approach in care in the management of chronic cases, especially non-communicable diseases (NCDs) to achieve better outcomes.

There can be potential abuse of medications and risk of complications such as end-stage renal failure which can result from such disregard for proper health care monitoring and protocols.

A number of TPAs also have a notorious reputation in delaying claims payments, leaving many of their panel clinics struggling financially. Private clinics rely on these settlements to sustain their practice as managed care clients form a substantial portion of patients.

To date, many private clinic patients are under the managed care model, with only a small percentage of walk-in cash paying patients. 

The MOH has so far refused to intervene in these matters. In a recent meeting organised by the Private Healthcare Productivity Nexus under the Malaysian Productivity Corporation, the MMA had raised these issues.

It is a matter of disappointment that agencies, like Bank Negara Malaysia (BNM), showed reluctance in engagement, while in the same breath trumpeted concern over the rising costs of health care. 

MMA has also highlighted these malpractices to the Malaysian Medical Council (MMC), calling for action to be taken against doctors in questionable contracts with TPAs. The MMC has assured that action will be taken upon receiving valid written complaints about practitioners. 

Regrettably, there has been no change in the practices of TPAs since 2015, and they remain unregulated. The MMA’s warnings on the potential issues and malpractices since 1998 have gone unheeded.

For years, the practices of TPAs have gone unchecked, and there is now commercialisation of health care taking place right under our noses. The unchecked problematic TPA revenue structures and their unchecked outsourcing practices can potentially undermine the quality of patient care. 

We urge the MOH, MMC, and relevant bodies to urgently step in and put a stop to these commercialist and unethical practices of the TPAs and strictly regulate their activities.

We must, to preserve the sanctity of the medical profession and safeguard the quality of care for the people.

Dr Muruga Raj Rajathurai is the president of the Malaysian Medical Association.

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