KUALA LUMPUR, June 13 — The Health Ministry (MoH) is proposing to review the low medical fees currently imposed on Malaysians at government health facilities and match this with how much patients could afford instead, according to its White Paper published today.

In the Health Ministry’s White Paper, it said the low fees charged at public healthcare facilities were greatly appreciated by Malaysians as they could access the health system at an affordable price.

But the ministry said there is a mismatch between the medical fees charged and the costs incurred to provide the services, when patients are from higher-income groups.

"However, the same fee structure for all has contributed to a huge disparity between the payment imposed as compared to the cost of providing and the capability to pay, especially among high-income households.

"To improve the sustainability of funding public healthcare, the rate of fees imposed at public healthcare facilities will be reviewed to match affordability levels better. However, the safety net for low-income households will be maintained,” it added.

This proposal to change the government’s medical fee structure is part of a bigger strategy of increasing investment in Malaysia’s healthcare, to make the country’s healthcare funding more sustainable — instead of relying just on the government for funding — and to make it a joint responsibility, as the demand for healthcare continues to grow here.

Helping Malaysians spend less income for healthcare

Apart from proposing to revise the medical fee structure, the Health Ministry also wants to ensure Malaysians receive medical treatment without being limited by their financial capabilities and to help Malaysians use less of their own money to pay for medical treatment.

In the White Paper, the Health Ministry cited the Malaysia National Health Accounts’ 2021 statistics of current health expenditure in 2020, where Malaysians digging into their own pockets or out-of-pocket (OOP) spending was the second highest at 34.2 per cent, just behind the Health Ministry’s funding at 46 per cent. (This is in comparison to the OOP in other countries like Thailand (8.7 per cent) and Türkiye (16.9 per cent).)

According to the White Paper, Malaysia’s healthcare system consists of two mostly non-integrated systems operating separately, namely the public sector providing universal healthcare with primary healthcare services at low fees and government-subsidised secondary and tertiary care, and the private sector with fees mainly paid out of pocket or from private health insurance including employees’ benefits.

The Health Ministry said such a system was imbalanced, with government healthcare facilities — which are available nationwide even in rural and remote areas — burdened with a higher proportion of patients and facing pressure in coping with the demand nationwide, as compared to private facilities focused at urban and suburban areas.

The ministry said this was also leading to the higher payments from Malaysians’ own pockets: "Although a large part of the OOP is from high-income patients using private healthcare services, there are increasingly more low-income and mid-income patients going to the private sector due to the short and easy waiting time to receive treatment, despite having to bear financial risk.”

The ministry said OOP spending on healthcare is inefficient and inequitable, as it increases the financial risks for households, reduces risk-sharing and encourages Malaysians to not seek healthcare services.

To help reduce OOP spending on healthcare, the ministry proposed the strategy of introducing a "health benefits package” to outline the type of health services and medicines that Malaysians can access at an affordable fee with the same level of healthcare, regardless of whether the provider is from the public, private or non-profit sectors.

The ministry plans to have it cover all evidence-based services, promotive and preventive services, starting from primary healthcare to hospital care, including possibly digital healthcare services providers. The package scope will be based on objective economic and health technology evaluation, and be expanded continuously in line with the maturity of the national health funding system and changes in health needs.

The ministry proposes the setting up of a new special health fund — to be mainly funded with government allocations and possibly to include donations from individuals and big donors in the future — to fund this health benefits package.

Having a special health fund for this initiative will enable sharing of health risks and financial risks and a wider cross-subsidy in line with the aim of providing universal health care.

To ensure that this special fund does not burden the public but fulfils public interest, the ministry said the fund will be managed by professional not-for-profit strategic buyers and will be managed through clear reporting standards and tight supervision.

But the ministry said this proposal for such a package and risk-sharing nationally using a special health fund is still at the conceptual stage and needs bipartisan support.

As for when these proposals would take shape, the ministry plans to study or review the fee structure for public healthcare services within the short-term period of one to five years.

As for the mid-term period of six to 10 years, the ministry plans to increase government investment in healthcare such as through improvements in the laws for fees, and to channel the diverse healthcare funding sources to the special health fund set up in the previous phase and to improve the health benefits package that can be offered to Malaysians. In the long-term period of 11 to 15 years, the ministry plans to continue to improve on the package and to ensure continued funding to the special health fund.

These proposals fall under the third pillar in the White Paper of ensuring sustainable financing for healthcare in Malaysia.

The White Paper has four pillars of reforms, namely transforming healthcare service delivery; advancing health promotion and disease prevention; ensuring sustainable and equitable health financing; strengthening the health system’s foundations and governance.