APHM warns cost of private healthcare will rise

PETALING JAYA: The Association of Private Hospitals of Malaysia (APHM) has warned that the cost of private healthcare will experience at least 5% increase starting from April 1 next year due to the Goods and Services Tax (GST) coming into force.

Speaking at a conference today, APHM president Datuk Dr Jacob Thomas said private hospital doctors are independent practitioners who work in the hospitals on a contract basis and are not employees unlike medical officers in public hospitals.

He said imposing the consumption tax on their services will only lead to patients having to dig deeper into their pockets.

"We have repeatedly consulted the Ministry of Finance and the Customs Department to appeal for health care services to be regarded as Exempt Supply but we were rejected. Instead, it was suggested that the hospital absorbs the additional cost but this is hardly a feasible option and will lead to small hospitals going bankrupt," he added.

He said that this was contrary to Health Minister Datuk Seri S. Subramaniam's assurance on Nov 3 that GST would not impact healthcare cost.

Jacob stressed that with the implementation of GST, hospital operational costs such as security, laundry and housekeeping services will increase and this will inevitably be borne by the patients who use them.

He also said that there were conflicting statements on whether GST would be implemented on drugs and medical equipment.

"There have been 5 different updated guidelines in the past two months. We are still waiting for the list on equipment that are exempted from GST," he said.

"Around 45-70% of a patient's medical bill, depending on the medical procedure involved, is the doctor's portion and thus when the doctor's fee and medication increase, we can predict a big shift of patients from the private sector to the public sector," Jacob said, adding that this would subsequently clog up the public healthcare system.

"If the policy on private healthcare services cannot be revised, we ask that the Government stop giving false assurances about GST not impacting the cost and instead, tell them the truth. This is to avoid the mismatch between the perception of the public, government's intention and implementation by the industry," he stressed.

In addition to rising private healthcare cost, Jacob said insurance premiums would also be affected although he could not determine the extent.

"Some 13% of the country's healthcare is in the private sector. The country's private sector ranks third in the world. It will be challenging to maintain such an achievement if prices shoot up."

Jacob said that the price increase would affect everyone as private healthcare is not limited to a certain social class.

"Doctors in the government hospitals also refer their patients to private hospitals for certain procedure,." he elaborated.