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Budget 2018: An extensive overview on the possibility of improving Malaysia’s healthcare system

Racheal Ngu, 02 Nov 2017
Malaysia’s government has granted the Ministry of Health (MOH) an increased budget for the year 2018. This year, nearly RM27 billion is allocated, with promises of new hospitals and wards to be built in Pahang, Putrajaya, Kedah, Penang and a forensic medical centre in Kuala Lumpur Hospital (HKL).

The budget aims to promote heart health and create awareness about non-communicable diseases nationwide. It is also expected to promote Malaysia as a hub for fertility treatment and cardiology in Asia.

A total of RM30 million from the total health budget will also be allocated to the Malaysia Healthcare Travel Council (MHTC) as an incentive to boost Malaysia’s healthcare travel industry, announced Prime Minister Datuk Seri Najib Razak on 27 October.

Medical tourism industry receives recognition in Budget 2018

The RM30 million budget for Malaysia’s healthcare tourism system is in line with the national economic blueprint, where healthcare travel has been recognised as one of the National Key Economic Areas (NKEA) set to drive the country towards a high-income nation by 2020.

From 2011 to 2015, the healthcare travel industry recorded an average growth rate of 15%. In 2016 alone, the industry grew by 23% from 2015—with an estimated actual contribution of approximately RM4-5 billion to Malaysia’s economy. Additionally, there are more than 921,500 health travellers seeking treatments in Malaysia.

Health Minister Datuk Seri Dr S. Subramaniam and chief executive officer of MHTC, Sherene Azli, welcomed the government’s move to promote Malaysia as a hub for fertility treatment (including IVF) and cardiology.

Consistently, Malaysia has been receiving high demand for fertility and cardiology treatments, especially from within our current focus countries (Indonesia, Vietnam, China and recently India). We have seen growth from these countries and there is enormous potential for Malaysia to be in the same level field of some of the international medical tourism offering countries,” Sherene further elaborated.

The prime minister also introduced the “Flagship Hospital programme”, to “support selected hospitals to step-up the internationalisation of individual organisations exemplifying enterprise, patient safety, quality care and service, quality management and service experience to accelerate their growth,” she noted..

“We truly welcome the allocation and are excited with the budget announcement to spur further growth of medical tourism industry,” echoed the CEO of MHTC.

RM26.58 billion allocation for MOH aimed to serve Malaysians better

The 2018 budget allocation for MOH is RM26.58 billion, a 9.5% or 1.7 billion increase compared to the 2017 budget, highlighted Dr Subramaniam.

“I am pleased with the announcement as this will assist our ongoing health transformations initiatives apart from providing a strong base for the health services to be provided to the Rakyat (Malaysian citizens),” said Dr Subramaniam in a statement posted on his website.

Dr Subramaniam indicated that an allowance of RM30 million will continue funding a community based health empowerment initiative called KOSPEN, to increase awareness on noncommunicable diseases (NCDs). Launched two years ago, 40,000 volunteers have been trained to be “health ambassadors” – giving advice on health issues, measure blood pressure and glucose.

Another RM50 million is allocated for the introduction of the Voluntary Health Insurance (VHI) Scheme – a non-profit-oriented and voluntary basis insurance programme aimed at enhancing the health sector.

“In the long term, we would be able to optimise our healthcare facilities in both government and private sectors and address the shortcoming within current private health insurance schemes,” commented Dr Subramaniam.

Health Minister Datuk Seri Dr S. Subramaniam said he was “pleased with the announcement as this will assist our ongoing health transformations initiatives apart from providing a strong base for the health services to be provided to the Rakyat (Malaysian citizens).” Photo credit: New Straits Times
Health Minister Datuk Seri Dr S. Subramaniam said he was “pleased with the announcement as this will assist our ongoing health transformations initiatives apart from providing a strong base for the health services to be provided to the Rakyat (Malaysian citizens).” Photo credit: New Straits Times

Yet, the allocation of RM4.1 billion for the supplies of drugs, medicines, medical aids and other consumables – including vaccines and reagents – in 2018 remains unexpectedly the same as in 2017.

“This is cause for concern as an insufficient allocation can result in shortages of essential drugs needed to treat diseases, particularly non-communicable diseases such as hypertension, heart disease and diabetes,” noted Azrul Mohd Khalib, CEO of Galen Centre for Health & Social Policy.

Malaysian Medical Association (MMA) president Dr Ravindran R Naidu also expressed disappointment at the exclusion of the healthcare industry in the list of zerorised items for good and services tax (GST).

“Healthcare is one of the most essential services for the Rakyat and there was no GST exemption for it,” he remarked.

During the submission of wishlist to the prime minister, he further expressed that MMA had “highlighted that our main concern was the implementation of GST in healthcare. It was disappointing that Najib gave exemptions in other areas but not healthcare.”

Reductions in the health budget 2018; and other governmental initiatives

MOH receives an 9.5% growth of allocated budget, compared to the 2017 Budget. Photo credit: Malay Mail Online
MOH receives an 9.5% growth of allocated budget, compared to the 2017 Budget. Photo credit: Malay Mail Online

The government promises to use RM2 billion to build new hospitals and wards with a total capacity of 1,100 beds.

However, upon closer observation, the allocation for new hospitals is actually reduced by RM30 million which is “probably just enough for 100 new hospital beds,” highlighted Kampar MP Dr Ko Chung Sen.

Similarly, the allocation for pharmacy and supplies experiences a reduction of more than RM65 million compared to the year 2017.

“The allocation was much higher at RM1,595,601,600 in 2016,” Dr Ko added.

Also declared as part of the 2018 Budget to help the underprivileged, a total of RM50 million is allocated for haemodialysis assistance, including a RM100 subsidy out of the RM110 treatment cost per session. An additional RM40 million is also allocated for the Medical Aid Fund. MIMS



Summary of Malaysia’s health budget for year 2018.


Read more:

MOH reassures “patient safety comes first”, after recent “reuse of disposables” allegations
MOH Malaysia hopes for a bigger budget for 2018 to meet growing health demands
Budget 2017: An overview of its impact on Malaysian healthcare in the coming year

Sources:
https://www.nst.com.my/news/nation/2017/10/296023/2018-budget-medical-tourism-set-grow
https://www.imtj.com/news/malaysia-healthcare-travel-council-mhtc-receives-2018-budget-allocation/
http://www.themalaymailonline.com/malaysia/article/health-tourism-gets-rm30m-boost-to-the-heart#we19kggfxlvd65p5.97
https://www.nst.com.my/news/nation/2017/10/296500/2018-budget-priority-given-rakyats-healthcare-needs
http://www.freemalaysiatoday.com/category/nation/2017/10/27/why-no-gst-exemption-for-healthcare-say-doctors/
https://www.thestar.com.my/news/nation/2017/10/27/budget-2018-full-speech/
http://www.freemalaysiatoday.com/category/nation/2017/10/31/kampar-mp-scoffs-at-najibs-healthcare-budget-promises/
https://www.nst.com.my/news/nation/2017/10/295750/2018-budget-rm2b-improve-tourism-industry
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