KUALA LUMPUR, Jan 8 — Private hospital bills in Malaysia are largely unregulated, with up to 70 per cent of charges falling outside government oversight.
Azrul Mohd Khalib, CEO of the Galen Centre for Health and Social Policy, said these unregulated charges often include fees for basic items and services like wheelchairs, heart monitors, and even the use of stainless steel kidney dishes.
“Private hospitals are charging for things that don’t necessarily need to be charged,” Azrul said at the “Rising Healthcare Cost In Malaysia” forum organised by Universiti Malaya Student Union (UMSU) Faculty of Medicine, in collaboration with the Galen Centre of Health and Social Policy, Demokrat Malaya, and NewGen UM last Friday.
“If you look at hospital bills today, how much of it is the specialist charge? How much of it are drug charges? And how much of it are hospital-related charges? We find that, based on industry research, 30 per cent are specialist and drug charges, while 70 per cent of the hospital bill – which is sometimes 16, 17, 18, or 20 pages long – are unregulated.
“They can charge what they want, as much as they want, even for the use of kidney dishes – the stainless steel trays that you put instruments in and so forth. Hospitals can charge for the usage of that kidney dish as well.
“It’s unregulated. That 70 per cent of the hospital bill today is unregulated, which is why we are having these conversations today about what is a reasonable and rational charge in a hospital,” he said.
MP Labels Private Health Care As The ‘Wild West’ Amid Rising Costs
Bayan Baru MP Sim Tze Tzin described private health care as the “Wild West”, claiming the sector operates without sufficient regulation and is excessively profiteering.
Malaysia’s private health care and insurance sectors reported strong financial performances last year, with KPJ Healthcare Bhd achieving a record RM1.03 billion quarterly revenue in Q3 2024. IHH Healthcare Bhd saw a 43 per cent year-on-year rise in core net profit to RM528 million for the same quarter. Both are major private hospital operators.
Insurers AIA Berhad recorded a profit after tax of about RM1.1 billion for the first half of 2024, a 33 per cent increase from the same period the previous year, and Allianz Malaysia Berhad’s Q3 2024 revenue grew 10.3 per cent year-on-year to RM1.44 billion.
“There is no regulation of private hospitals. Yes, it’s true,” Sim said. “I spoke to Dr Dzulkefly Ahmad, the health minister, and he said his hands are tied, he has no punca kuasa. That’s why there’s no regulation for hospital services or protection for consumers. They can charge whatever they want.
“For example, a pair of gloves. Some people complained to me about being charged RM20 for a single pair of gloves in their medical bill. One box of gloves costs around RM50, but you charge a pair for RM20. Diapers – you can buy an eight-pack at Tesco or wherever for around RM50, but you charge one diaper for RM50. That’s too much.”
Sim stressed that while private hospitals are profit-driven, there is a line between profitability and excessive profiteering.
“If the government can regulate eggs or, two years ago, rice – when a 10 sen increase from 40 sen to 50 sen caused a hue and cry across the country and gaduh in Parliament until the roof falls in, and KPDN and MyCC can go in and investigate for excessive profiteering – why can’t private hospitals be regulated?” said Sim, who was deputy minister of Agriculture and Agro-based Industry in the Pakatan Harapan administration from 2018 to 2020.
KPDN is the Ministry of Domestic Trade and Cost of Living, whereas MyCC is the Malaysia Competition Commission, a statutory body established under KPDN.
Sim, who is also a member of Parliament’s Public Accounts Committee, vowed to push for an open hearing on the rising costs of medical services and insurance. He plans to discuss with PAC chairwoman Mas Ermieyati Samsudin about calling private health care stakeholders, including hospitals and insurance companies, when Parliament reconvenes next month.
Call For New Regulatory Body To Govern Health Insurance, Hospital Charges
Azrul has called for the setting up of a new regulatory body to specifically address the issue of health care inflation in Malaysia. He suggested that health insurance, currently regulated by Bank Negara Malaysia (BNM), should be placed under this new body, which would act in the interests of consumers rather than the industry.
“Bank Negara Malaysia (BNM) is not going to like it, but we need to take health insurance out from BNM and put it into this new regulatory body because they need to act in the interest of patients and people. Right now, we see BNM acting in the interest of the industry. So, they (the new body) will regulate health insurance,” Azrul said.
He also highlighted the need for the regulatory body to address the unregulated portion of hospital bills, which make up 70 per cent of private hospital bills.
“Second, is that they (the new regulatory body) would regulate the unregulated, which is the 70 per cent of the hospital bill that I mentioned earlier,” he added.
“So, we have a new regulatory body, and the intention is to regulate what is not regulated so that we can get a grip on health care inflation. But I have to caution here — there is no magic bullet. There is no rabbit that we can pull from a hat and solve this. This needs firm determination and commitment, and it will take a couple of years.”
Azrul further stressed the importance of creating a national health and social insurance system that would address both health care and ageing costs. It was noted that aged care is currently not covered by any comprehensive scheme.
“Today, ageing is not covered by anyone. It’s a hope and a prayer. You are expected to be covered by the private sector. The government is not assisting in terms of aged care. We need to fund aged care properly, and so we’ve suggested introducing a national health and social insurance, which will cover health and aged care. Whether or not we can do it, we have to talk to politicians,” Azrul said.
