“Local private hospital sector in a healthy state”

“Local private hospital sector in a healthy state” was the sub-title of an article in StarBiz on 25th June 2021 that analyzed the purchase of a 16% stake in Sunway Healthcare by GIC Pte Ltd at a price of RM 750 million. This article drew attention to the high price to Ebtida (Earning before interest, taxes, depreciation and amortization) ratio of 31.3 for Sunway Healthcare compared to 19.08 for IHH. The writer ascribes this higher valuation as due to the strategic expansion plan that Sunway Healthcare announced recently involving the building of 6 new hospitals which would increase its bed capacity from 856 currently to 2,560.  

However, glaringly absent in this otherwise well-researched article is any analysis of the impact of the expansion of private hospital capacity on the healthcare for ordinary Malaysians. Most ordinary Malaysians have to depend on the government hospitals if they develop a serious health problem. Unfortunately, government hospitals which now handle about 75% of in-patients in the country, are very short of experienced specialists. More than 75% of the doctors aged less than 60 years with 10 years or more experience as specialists are in the private sector. The remaining 25% have their hands full with the heavy patient load in the government sector, providing training of house-doctors and specialist trainees and the administrative duties of managing large departments.    

Our deployment of medical personnel in the country leaves a lot to be desired. Not only do we have a two-tier system of health care where there are delays in the treatment of patients with serious health issues in government hospitals but also, the imparting of knowledge and experience to the younger generation of doctors is markedly impaired because 75% of the experienced specialists are not in contact with the young doctors in government service. 

The PSM has been suggesting the several measures to address the issue of brain drain of doctors and para-medical staff to the private sector. The government should 

  • set up a separate service commission for medical staff and use the Institut Jantung Negara salary scale as a template to develop better terms of renumeration for health staff in the government.
  • borrow the concept of sabbaticals from the universities and offer government specialists paid sabbaticals of 3 to 6 months every 5 years of service as a specialist. Specialists could use these sabbaticals to go and learn new techniques and procedures, thus enhancing the quality of medical services in the country.
  • institute a moratorium on new private hospitals for the time being. New private hospitals aggravate the brain drain by recruiting specialists as well as experienced and competent paramedical staff (eg operation theatre technicians, ICU nurses, midwives etc) from the government sector. The depleted government sector is already buckling from the work pressure.
  • increase the health allocation from its current 2.1% of GDP to 4% so that the more government hospitals can be built, more health care staff employed and a better pay scheme implemented.

However, sadly, the political elite in this country seem to be unable to view the healthcare system in a  holistic manner. They seem oblivious to the fact that the over-rapid development of the private sector undermines the public hospitals. This inability to view the health care system as interconnected has been true of the Pakatan Harapan government as well as the Barisan Nasional. 

“Kita jaga kita” is a lovely slogan. But it is of no help if it only remains a slogan. The Covid pandemic has affected Malaysians to different extents. The richest 10 to 20% of the population have actually seen an increase in their wealth – share prices have gone up over the past 18 months. The workers in the formal private sector have been cushioned by the wage subsidy schemes but despite that, many of them have had to draw down their EPF savings quite markedly leaving them vulnerable to financial insecurities in their later years. The bottom 30% who are in the informal sector have fared the worst. For many among them, their incomes collapsed and they have had to cut back on the consumption of food after depleting whatever little savings they might have had.     

Building back better (another lovely slogan) would require that we implement measures that provide better support for those affected most adversely by the pandemic and lockdowns. One of the things we can and should do is to strengthen the government health care system which ordinary Malaysians depend upon. To do that we have to base our decisions regarding the development of the health care sector in Malaysia on a proper understanding of the interconnections between the public and the private sectors.    

Dr. Jeyakumar Devaraj
Parti Sosialis Malaysia

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