KUALA LUMPUR, Oct 23 – Bandar Kuching MP Dr Kelvin Yii has proposed a phased introduction of a national social health insurance scheme to make health care financing more sustainable in Malaysia.
In his debate on the 2024 Budget in the Dewan Rakyat today, Dr Yii suggested starting a social health insurance scheme with government-linked company (GLC) employees first, and later expanding it to the wider population.
Dr Yii pointed out that GLC employees already have existing private insurance coverage, making it unnecessary to reinvent the wheel. He said the goal is to transfer and potentially expand the scheme to others.
“If the social health insurance scheme is implemented effectively, especially if health indicators improve and health care services become better – shorter waiting times, better medications – I believe more and more people will participate in this scheme,” said Dr Yii, who is also special advisor to the health minister.
Dr Yii outlined that a phased rollout of the social health insurance scheme, starting with a 5 per cent contribution from employees, matched by a 5 per cent employer contribution, could potentially generate RM15 billion to RM17 billion annually, based on collection estimates derived from existing models by the Employees Provident Fund (EPF) and the Social Security Organisation (Socso).
Galen Centre for Health and Social Policy chief executive Azrul Mohd Khalib previously estimated that a payroll-funded social health insurance scheme could add an estimated RM31.1 billion to health care spending, in addition to the Ministry of Health’s (MOH) federal budget allocations.
Azrul said a social health insurance scheme akin to Socso’s Employment Insurance System (EIS) and payroll contributions to the EPF can collect between RM780 million annually and RM31.1 billion per year, the latter matching EPF’s contribution model.
“Just imagine, the health budget announced this year is the largest we’ve had at RM41 billion. If we have an additional RM32 billion (from social health insurance), we can invest in health care equipment, improve run-down clinics and hospitals, support our health care workers, increase their allowances to retain them in the system, enhance digitisation in the health care system, and much more.
“But, as I said earlier, this needs to be implemented gradually so that it doesn’t become a sudden burden on the people or the market,” Dr Yii said.
The DAP lawmaker said the country needs to find additional sources of financing for health care, citing models used in Thailand, South Korea, and Taiwan, where national health insurance schemes have been successfully introduced.
Dr Yii added that Malaysia’s national health insurance scheme should be managed by the government and not the private sector.
“The philosophy behind it is not profit-driven but aimed at ensuring that it is sustainable and benefits our citizens,” Dr Yii said. “I want to stress that this does not involve the privatisation of medical services or a model similar to that in the United States. In fact, the model used in the US is one we should look at but not one we should follow in our country.”
“I know this is not a popular decision, and it is challenging because nobody likes to contribute from their own income or pay additional tax. However, this is crucial for the long-term sustainability of the health care system, not just for the next 10-15 years, but in the longer term,” Dr Yii added.