KUALA LUMPUR, May 26 — The Ministry of Health (MOH) reiterated today that any form of doctor fee-splitting or inducement arrangements is prohibited under the Private Healthcare Facilities and Services Act 1998 (Act 586) and its regulations.
According to the ministry, any requirement for doctors to reduce professional fees as a condition for referrals, panel participation, or access to patients – under arrangements involving private hospitals, third-party administrators (TPAs), or insurance and takaful operators (ITOs) – may fall within the scope of prohibited fee‑splitting practices, depending on the specific facts and contractual terms.
“These situations will be assessed on a case‑by‑case basis, with consideration given to the actual arrangements, supporting evidence, and relevant legal provisions,” the MOH told CodeBlue in a statement.
“MOH emphasises that any enforcement action will be based on proper investigation and legal assessment. As Act 586 primarily regulates licensed and registered private health care facilities and practitioners, action under the Act would mainly involve these regulated parties where non‑compliance is established.
“While TPAs and insurers are not directly licensed under Act 586, their role and contractual arrangements may still be examined as part of the overall assessment, and relevant authorities may be engaged where appropriate.”
ITOs fall under Bank Negara Malaysia’s (BNM) jurisdiction, whereas TPAs are unregulated.
MOH added that arrangements involving deductions from doctors’ professional fees in exchange for participation in TPA or insurer panels, or for patient referrals, may “raise concerns” under the applicable laws and professional ethical standards.
“Where evidence indicates non‑compliance, MOH may take appropriate action in accordance with the law, subject to the outcome of investigation.
“Where the arrangements involve insurance or managed care financing structures, the matter may also fall within the purview of other regulators such as Bank Negara Malaysia or the Malaysia Competition Commission, depending on the nature of the conduct.”
The MOH’s statement was issued in response to the Malaysian Medical Council’s (MMC) recent statement that it has prohibited fee-splitting practices involving private hospitals, ITOs, and TPAs.
The Malaysian Medical Association (MMA) previously complained about private hospitals compelling independent specialist doctors to reduce their professional fees due to discount arrangements negotiated between hospitals and medical insurers.
The doctors’ association also noted that general practitioners (GPs) must agree to a TPA’s contract terms to be on its panel, including deductions of 10 to 15 per cent from the doctor’s professional fee.
The Life Insurance Association of Malaysia (LIAM) told CodeBlue it needed time to study the MMC’s ruling.
The Association of Private Hospitals of Malaysia (APHM) and BNM have yet to provide a statement when asked by CodeBlue for comments.
