The Association of Private Hospitals Malaysia (APHM) supports Bank Negara Malaysia’s (BNM) requirement that insurance and takaful operators (ITOs) implement a copayment option for their medical and health insurance and takaful (MHIT) products by September this year.
These copayments are additional out-of-pocket expenses that insured people must pay when seeking treatment for qualifying conditions, in addition to the monthly premiums they paid before becoming ill.
We also support Health Minister Dzulkefly Ahmad, who has questioned Bank Negara Malaysia over the implementation of copayment criteria for MHIT products to reassure consumers.
The establishment of a copayment system in health care can provide numerous benefits. One of the primary advantages is that it encourages patients to be more cautious in their usage of health care services.
When patients must pay a portion of their medical expenditures out of pocket, they are more likely to weigh the importance of a doctor’s visit or specific treatment. This could lead to better health outcomes by preventing overuse of resources.
The copayment method can also help to cut insurance premiums by eliminating false claims and promoting financial stability in the insurance business. Insurers can provide a greater range of policies to match clients’ various financial and health care demands, making health care coverage more affordable for individuals and families.
Health care providers believe that a copayment system can assist reduce hospital congestion and improve resource allocation. When patients become more aware of their health care spending, hospitals may enjoy up to a 20 per cent reduction in overcrowding, allowing for better resource management and potentially enhanced service delivery.
However, the copayment mechanism presents various issues. People from low-income families may put off critical care due to high out-of-pocket expenses, resulting in poorer health outcomes and higher long-term costs.
This could increase current health disparities, as 30 per cent of low-income people avoid necessary care owing to cost. Furthermore, the implementation of copayments may increase administrative difficulties for hospitals, potentially resulting in inefficiencies and revenue losses of up to 5 per cent.
The extra complexity of managing copayments may perplex customers and undermine their trust in the health care system.
Finally, the adoption of a copayment system must be properly planned and executed to ensure that access to important therapy is not jeopardised. Policymakers and health care stakeholders must find a balance between encouraging responsible service usage and ensuring that disadvantaged populations continue to receive needed treatment.
Singapore’s health care system operates on a copayment model, in which consumers pay 20 per cent of their health care expenditures rather than receiving free or totally subsidised care. This strategy tries to encourage responsible health care use while keeping costs low for both the government and people.
The system also includes MediSave and MediShield Life, which are national medical savings schemes that enable Singaporeans save for health care expenses. Private insurance products supplement MediShield Life’s coverage by requiring cheaper copayments or providing higher coverage limits.
Furthermore, Singapore offers varied degrees of health care subsidies based on patient income and service type, with low-income individuals and those with chronic medical conditions qualifying for up to 80 per cent government subsidies to minimise out-of-pocket costs.
The copayment system, MediSave, MediShield Life, and private insurance plans work together to create a sustainable and accessible health care system in Singapore, resulting in savings of up to 25 per cent.
Based on the Singapore experience and other similar experiences, it is critical that the desire to balance insurance premiums, access to treatment, and prevent over-provision of care be tackled holistically, while ensuring that the goal of introducing copayment is maintained.
This should be done while avoiding the short-term benefits of utilising copayment to limit access for commercial or financial advantage by any party.
Finally, a national approach that considers the numerous stakeholder requirements and problems will give the long-term results that we seek.
Dr Kuljit Singh is the president of the Association of Private Hospitals Malaysia (APHM).
- This is the personal opinion of the writer or publication and does not necessarily represent the views of CodeBlue.
