Call on Health Ministry to clarity its stand on HMOs and resolve the HMO controversy in Malaysia


by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Petaling Jaya on Wednesday, November 8, 1995:

Call on Health Ministry to clarity its stand on HMOs and resolve the HMO controversy in Malaysia

The Sun reported today that a majority of Tenaga Nasional Bhd’s panel doctors had signed an agreement to allow MediMaster, a health management organisation (HMO), to manage the health Care of Tenaga’s 25,000 employees.

More than 75% of Tenaga’s 370 panel doctors signed up before the Oct. 31 deadline while a few indicated they wanted to wait for Malaysian Medical Association (MMA) approval while some group practices asked for more time.

Telekom, employing 30,000 people, has also issued a letter of intent to a HMO to manage the healthcare of its employees.

It is time that the Health Ministry clarity its stand on HMOs and resolve the HMO controversy in Malaysia.

Medical practitioners have complained that they have been forced to sign up for HMO schemes as they were told that they would be dropped as company panel doctors if they did not do so.

In the HMO controversy, HMOs claimed that by playing the role of health providers or middlemen, they could reduce the healthcare for companies by between 15 and 20 per cent.

However, the great public interest issue is whether the patient’s health interest would be sacrificed to “lower costs” for companies and “greater profits” for HMOs.

A HMO is a company which manages a group of doctors under its umbrella and offers its services to employers to take care of their employee’s medical needs. Employers pay the HMO a fixed amount for each employee covered, and the HMO in turn pays its doctors a fixed sum per patient per year.

It has been reported that MediMaster has an annual capitation fee of RM85 per patient which works out to an average maximum of RM7 that doctors may spend on treatment for a patient a month.

There have been widespread reports about abuses of HMOs in other countries, where doctors prescribing treatment that exceeds that capitation fee have to obtain prior approval from the HMO, causing delay in treatment of emergency cases which have resulted in deaths.

Under the MediMaster HMO scheme, doctors are given two options – either a capitation fee or RM7 per patient per month or preferred fee for service of RM14 for an adult and RM12 for a child per visit.

As the fees cover only minor illnesses, the doctors will have to claim for “uncommon” or chronic illnesses and emergency treatment.

One controversy is the definition of “uncommon illness”, as Tenaga, through MediMaster, could reject these claims and MediMaster has not been able to produce a list of “common illnesses”.

The Malaysian Medical Association has also forwarded to the Malaysian Medical Council several important issues concerning doctor-patient relationship, confidentiality of patients’ records which are claimed to be HMOs intellectual referral of patients, etc., which must be addressed by the authorities.

As the right to health must be regarded as a fundamental human right, the Government has a responsibility to ensure that any HMO scheme would not sacrifice the rights and interests of patients to any corporate profit-making scheme.

The Health Ministry should immediately set up a special task force to carry out an in-depth study of the advantages and disadvantages of the HMO system, and if HMO is to be permitted, set up a system of registration and regulation of HMOs in the country.

Until such a study has been completed and a system of registration and regulation of HMOs has been put in place, there should be a suspension of all HMO activities in the country.

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