THE LOOMING MALAYSIAN HEALTHCARE DEBATE (PART 2)

Dr. Francis H.H. Ngu, M.B., B.S. (Mal.), M.H.P. (UNSW)
Sarawak.

THE CASE FOR INCREASE IN GOVERNMENT HEALTH CARE EXPENDITURE..

CUTTING BUDGET DEFICIT, CUTTING BUDGET FOR HEALTH CARE,
CO-PAYMENT TO FILL BUDGET GAP ARISING ???


It is evident that the timing of the proposal is awkward, following in the wake of botched government attempts to introduce the GST soonest and rapid withdrawal of multiple subsidies to shore up dwindling coffers, and a serious budget deficit. A major crises arising from the co-occurrence of national finance woes, health care woes and political woes has impacted on the Minister of Health to cap and even reduce government health service expenditure, while appearing to maintain or improve service.

Health care expenditure was targeted for reduction during the Great Austerity Drive of the mid-1980s, and is clearly targeted again in 2010. There has been a cutback of some 4.8% in the last budget, according to reliable sources.

It runs contrary to the 3rd proposal above (Part 1) to steadily increase government health care expenditure as percentage of GDP over 10 years to double to what it is at present. A total public-private health care expenditure of 7-8 % GDP is a shade higher than WHO recommendations for middling developing countries, but is at the lower end of developed countries. This is what it takes to qualify ourselves as a developed country in terms of health care after 2020.

At the current low levels of expenditure and serious public sector under-provision, Malaysia can hardly be said to be a nation continuing to make strides and progress when health care spending across the board were to be held back.

Such a proposal to increase health care expenditure would on the face of it sound lunatic, given the national indebtedness and poor fiscal shape! Read on.

The national indebtedness and fiscal deficit did not arise mainly from a chronically under-funded health care sector (under-funded, in terms of objective needs, citizen’s real life experiences and according to WHO recommendations), but to massive abuse and leakages of public funds, misallocations, mismanagement and wastage; and not let health care for citizens be the whipping target as the natural and acceptable sequaele.

Why not target the much larger defence expenditure at over 20 % of GDP for larger budgetary cuts ? A massive body of public discourse on corruption and cronyism, folly projects, overblown prices and costs and massive expenditure on defence hardware need not be re-canvassed here.

These are the roots of national indebtedness and fiscal woes which meager co-contribution in health care will do little to rectify.

NO SHORT-SIGHTED REFORMS, PUBLIC MUST NOT BE SHORT-CHANGED

HEALTH CARE COST INFLATORS:

In the event, health care needs requiring increased government expenditure arise from the following considerations:

1. Natural population growth of just under 2 %, much higher growth in Sabah from immigration;

2. Increasing population in the above 60 age groups, thus rising geriatric needs; in addition to a steadily changing population pyramid, slowly rising lifespans also impact on health care resources;

3. The impact of lifestyle diseases tending younger, and of neoplastic diseases (cancer) increasing in incidence as well;


4. High rates of road traffic accidents and industrial accidents/diseases; a major burden of disease is incidence and prevalence of mental illness in an industrial urban society facing different stress from different sources;

5. The growth of medical (doctors) personnel, as more Medical and Specialists posts will be filled; range and scope of service will expand faster with fast professional personnel growth; this is significant as professional personnel cost is a dominant component of recurrent health care expenditure;


6. Serious unmet hardware infrastructure needs in East Malaysia and elsewhere;

7. More outbreaks of traditional communicable diseases, and newer viral diseases;

8. The impact of subsidy withdrawal and GST introduction on domestic price inflation, both goods and services, to the health care budget;

9. Medical technology, which for Malaysia is largely imported, thus subject to international price pressures; the impact of imported inflation on medical and non-medical equipment and supplies.

10. Rapidly emerging new medical technologies, generally increasing health care costs.

A social need may be arising for fully or partly subsidized Nursing Homes in Malaysia in future, which the above proposal of 4.5-5 % of GDP does not cater for; this a most controversial matter best left to a later time for debate.
Similarly, rehabilitation facilities for the permanently handicapped is barely existent, however, this is largely within the founding mission of SOCSO.

Against these inflators of cost, the contribution from employers and employees, would be limited and rising slower than health care expenditure needs. This does not however, mean not thinking about co-contribution to a newly established national health finance fund. Considerations about co-payment will be dealt with in Part 3.

A BUDGETARY CUT REDUCES THE LOW PER CAPITA EXPENDITURE FOR HEALTH CARE EVEN MORE!

The cut-back on the chronically under-funded health care sector is as detrimental to the health and welfare of citizens, to their economic productivity, as it is morally and politically callous. If government cut-back, or reigning in of future budget outlays be the primary target of reform, then this reform is a no-go exercise in futility from the beginning, whether considered responsibly, rationally, professionally or politically.

Fortunately, it appears the Minister of Health is in support of greater government health care expenditure of up to 4 % of GDP, only that is shows up as a budget cut of 4% !

A steady government budgetary increase to 4.5-5 % of GDP, staggered out over a decade , is the responsible and sustainable way forward without critically affecting the budget deficit. With financial accountability and best practice, budgetary and fiscal prudence, colossal savings can be achieved elsewhere in the public sector; this even if government ignores the clamour from dissidents and oppositions, by just working on the Government’s own Auditor General’s Report published year after year.

This debate about long-term reform must be substantially re-geared !

A nation going forward must be able to deliver progressively better health care for all its citizens. A government budgetary commitment to health care is the essential measure of good and caring governance, under-writing its constitutional role and ensuring progress and social justice.