KUALA LUMPUR, Feb 21 — The Parliamentary Public Accounts Committee (PAC) said today it plans to scrutinise the entire healthcare and insurance ecosystem in a bid to address concerns over medical inflation, including looking into allegations of monopoly in the supply chain.
The Bayan Baru MP addressed the media after the PAC held its second public inquiry in Parliament building here this morning as part of an ongoing investigation, which will continue with closed-door proceeding this Monday.
“Yes we plan to study [allegations] of monopoly such as the supply of medicines,” PAC member Sim Tze Tzin told reporters after the public hearing concluded.
The committee had previously said the issue will be a top agenda this year after dozens of policy holders alleged some insurers announced they would raise premiums as high as 40 per cent.
Claims of price rigging in the healthcare industry reemerged following news of a planned hike of insurance premiums sparked public backlash that forced the government to intervene, with Bank Negara Malaysia imposing a 10 per cent cap and three year moratorium on further hikes of premiums.
Some of the attendees at today’s public hearing raised the same allegation, questioning why the authorities like Bank Negara Malaysia or the Ministry of Health have said little about the exorbitant cost of treatment by private healthcare providers, which had been used to justify raising insurance premiums.
Policy holders aged 60 above said they are the worst hit by any hikes since insurers tend to raise premiums for those they considered to be more risky. A few of them told PAC members they’ve settled for premiums that are cheaper now at the expense of reduced coverage.
One elderly man raised the issue of claims ratio, which is the amount of money subscribers get back from their premiums. He claimed insurers in Malaysia typically just spend 60 per cent of the premiums back on policy holders and keep the rest, while systems like the US’ Obamacare require a claims ratio of 80/20.
Sim said the committee viewed the complaints seriously, echoing experts’ opinions that the premium hike controversy as a symptom of a wider problem.
“Once all the proceedings are completed we will make all the necessary recommendations. Each proceeding is meant to look into the different areas but BNM had previously noted price discrepancies. Like dengue treatment, it’s four times the cost. Pneumonia, two times the cost,” he said.
“So we really need to scrutinise the ecosystem thoroughly. We will look at it and see if any Act needs to be amended,” the MP added.
“This is an ecosystem issue and not just private healthcare is involved but also Bank Negara. For example, do we need to amend the Financial Services Act, even that we need to look into.”
The first PAC public hearing session on the issue was held in AC Hotel in Bukit Jambul, Penang last week. This is the first time the committee is conducting a public hearing.
Teresa Kok (DAP Seputeh) said PAC is scheduled to hold up to 12 proceedings in the next three months, including the two public hearings.
