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Is Bank Negara Malaysia (Central Bank), as the regulator of the insurance industry, looking after the interest of the rich or the needy rakyat?BNM’s sham briefing for MPs with no solution in sight
KUALA LUMPUR, Dec 11, 2024: Bank Negara Malaysia (BNM)’s hour-long briefing for Members of Parliament yesterday was just a shameful public-relations stunt to quell the rakyat (people)’s anger and dissatisfaction over proposed hefty insurance premium hikes.
And Bayan Baru MP Sim Tze Tzin had the audacity to thank the Central Bank for the briefing that ended with no solution.
The briefing was shameful because all the reasons given by BNM for the proposed hike of between 40% and 50% are rubbish and unacceptable.
The reasons BNM gave for the hefty hike in medical insurance premiums:
> GROWING non-communicable diseases;
> AN ageing society;
> ADVANCEMENTS in healthcare technology; and
> HAELTHCARE workforce.
All the above are rubbish because they hold no water for a grossly profiteering industry.
If those are all valid reasons for such a hefty hike, why is the industry worth billions of Ringgit in revenue, if not trillions?
For the record, AIA’s annual medical insurance is RM77.41 billion, Prudential RM5.07 billion and KPJ Healthcare RM3.42 billion.
And, the recent sale of Penang’s Island Hospital for RM3.92 billion shows how profitable are the healthcare and medical industries.
It is for all to see nationwide how private hospitals have grown or expanded physically from shophouses to resort-looking premises.
So, why don’t BNM tell us how profitable are the industries today instead of giving reasons for the rich to spin more profits - with healthcare providers and insurance companies working hand in glove to squeeze the savings of the sick.
What’s wrong with the industries having to bear lower profits when they are already making multiple millions if not billions of Ringgit?
It all boils down to the industries’ greed and uncaring policies, backed by uncaring politicians who have been elected by the rakyat.
BNN, read also as the Government, is just uncaring and are looking after the interest of the rich, instead of the poor and needy, and the middle income group.
Unless the industries are on the verge of making losses, there is absolutely no reason for the Government to continue to allow profiteering!
No News Is Bad News reproduces below a news report on BNM’s sham briefing for MPs and other related previous postings:
BNM pledges interim solution to rising medical insurance premiums
-10 Dec 2024, 07:05 PM
Bayan Baru MP Sim Tze Tzin says the central bank gave this commitment at a closed-door briefing at Parliament this morning.
The closed-door briefing was chaired by finance minister II Amir Hamzah Azizan. (X pic)
PETALING JAYA: Bank Negara Malaysia (BNM) has pledged to find an interim solution to address the expected increase of between 40% and 70% in health insurance premiums.
Bayan Baru MP Sim Tze Tzin, who attended a one-hour briefing for MPs at Parliament this morning, shared the update in an X posting.
Sim posted a picture from the briefing, which was chaired by finance minister II Amir Hamzah Azizan and attended by BNM governor Abdul Rasheed Ghaffour.
“The government backbenchers thank Amir and Rasheed for their willingness to brief us.
“The government explained several factors contributing to the increase in premiums, including growing non-communicable diseases among the population, an ageing society, advancements in healthcare technology and healthcare workforce salaries,” he said.
Earlier in the Dewan Rakyat, Prime Minister Anwar Ibrahim assured that BNM and the health ministry would work together to prevent steep hikes in medical insurance premiums.
He said BNM, the finance ministry and health ministry would issue strict guidelines to ensure insurance providers, including takaful operators, factor in multiple considerations when setting premiums.
It was previously reported that the central bank had called on insurers and takaful operators to review repricing strategies for more “reasonable implementation”.
Berita Harian later reported that Sim suggested during the briefing that the government consider introducing a moratorium before finalising any decisions regarding the premium hikes.
“I suggested this, but it is up to them, as we understand this is a complex issue and all stakeholders need to be involved. The moratorium proposal needs to be carefully considered.
“However, it’s okay because the government has announced they will implement interim measures to address the issue,” he was quoted as saying.
IHH Healthcare to acquire 600-bed capacity Island Hospital for RM3.92bil
Wednesday, 04 Sep 2024
6:04 PM MYT
External view of Island Hospital – Macalister Wing
KUALA LUMPUR: IHH Healthcare Bhd has proposed to acquire a 100% stake in Penang-based Island Hospital Sdn Bhd (IHSB), which has 600 beds, for RM3.92bil cash.
In a filing with Bursa Malaysia, IHH said its indirectly wholly-owned subsidiary, Pantai Holdings Sdn Bhd (PHSB) entered into a sale and purchase agreement with Comprehensive Care Sdn Bhd (CCSB), a company established and majority-controlled by leading Asian private equity firm Affinity Equity Partner, for the proposed acquisition.
The proposed acquisition entails PHSB acquiring 20 million shares in IHSB, representing the entire equity interest for RM3.92bil cash, while IHSB and its subsidiaries have an estimated net debt of RM276.3mil as of June 30, 2024.
Upon completion of the proposed acquisition, PHSB will be the holding company of IHSB Group.
IHH stated that the proposed acquisition will be funded through a combination of internal funds and external borrowings, with the exact proportions still to be determined.
Group chief executive officer Dr Prem Kumar Nair said IHSB presents a transformative opportunity for IHH in Malaysia.
“Its leading position in Penang, extensive specialist pool and clinical offerings, as well as its status as the hospital of choice for foreign patients, make it an asset that complements our growth plans in the country.
Monday, 9 December 2024
Something’s rotten in medical insurance - it’s greed, profiteering and uncaring
Share to help stimulate good governance, ensure future of people & M’sia
No News Is Bad News
Is Bank Negara Malaysia, the regulators of the insurance industry, uncaring? (Read as the Government)
Something’s rotten in medical insurance - it’s greed, profiteering and uncaring
Update1
Malaysia
New guidelines on insurance premiums to be issued, says PM
He also said that efforts would be made to amend Schedule 13 of the Sale of Drugs Act.
Updated 13 seconds ago · Published on 10 Dec 2024 11:03AM
Anwar also announced that the government would introduce a Diagnosis-Related Groups (DRGs) guideline to standardise specialist fees.- December 10, 2024
BANK Negara Malaysia will review and issue new guidelines regarding the increase in insurance premiums, said Prime Minister Datuk Seri Anwar Ibrahim.
Speaking in the Dewan Rakyat today, Anwar also announced that the government would introduce a Diagnosis-Related Groups (DRGs) guideline to standardise specialist fees.
He also said that efforts would be made to amend Schedule 13 of the Sale of Drugs Act.
"Based on the latest information from BNM and the MoH, they will decide on a control mechanism so that the hike is not too drastic. This is to avoid burdening patients and leading to rising inflation," added Anwar.
He was responding to a question by Suhaizan Kaiat (PN-Pulai) on the measures taken by the government to control the 40-70% hike in insurance premiums and medical inflation.
“What we’re doing now is not a moratorium but interim so that the increment is small and sensible,” added Anwar.
On the issue of an addendum to place former premier Datuk Seri Najib Razak under house arrest, Anwar said it was not raised during the initial Federal Territories Pardons Board (FTPB) meeting on Dec 8, 2023.
Anwar said Najib’s royal pardon application was originally not part of the meeting’s agenda.
"I was the one who brought the application for (Datuk Seri Najib Razak's) royal pardon to be included in the Pardons Board agenda," he said.
He said that despite being one of the harshest critics of the 1Malaysia Development Bhd (1MDB) scandal, a request for a royal pardon still needed to be presented for consideration.
"When an appeal for a royal pardon is made, I present it to the Yang di-Pertuan Agong - we cannot ignore it," he said.
However, he said that his involvement was limited to the initial meeting on Dec 8 and that the following meeting on Jan 29, 2024, was attended by the minister responsible, the federal territories minister Dr Zaliha Mustafa. - December 10, 2024
KUALA LUMPUR, Dec 9, 2024: The Coverage has reposted news articles with the headline - Something’s Rotten In Medical Insurance – AIA RM77.41 Billion Revenue , Prudential RM5.07 Billion Revenue & KPJ Healthcare RM3.42 Billion Revenue.
The revenue figures are astounding and the rakyat (people) are just damn angry.
Who is to be blamed for Malaysia’s rising medical insurance premium woes?
> FIRST - the greedy, uncaring profiteering medical insurance companies and, private hospitals or healthcare operators; you can die for all they care!
> SECOND - the uncaring politicians and those elected by the rakyat to defend the needy and country; and
> THIRD - A Government that cares more for the rich than the middle-class and poor.
Anymore to add?
No News Is Bad News reproduces below the news reports:
Something’s Rotten In Medical Insurance – AIA RM77.41 Billion Revenue , Prudential RM5.07 Billion Revenue & KPJ Healthcare RM3.42 Billion Revenue
SOMETHING is rotten in the medical insurance sector. The immediate suspicion is greed among private healthcare providers and excessive profit on the part of insurance providers.
But is that really the case? We need some answers, and we need them fast before things really go out of hand.
It’s a burning issue for an obvious reason. Recent discussions around the big jump in medical insurance premiums is unsettling for the working class and your regular, honest, day-to-day entrepreneur trying hard to make ends meet. Even those with a better standing in life, financially, are feeling queasy. Some see their medical insurance premiums doubling or more.
The upward pressure on medical spending is a definite nightmare. For the uninsured, the out-of-pocket payment can break the bank account. For the insured, they will be wondering if they can sustain premium payments, more so if presented with a huge spike in premiums at renewal.
Hence, the seemingly unjustified insurance premium hike has caught the nation’s imagination.
Even the lawmakers have come around to address the issue. Tomorrow, the Health Parliament Special Select Committee will sit down with some key stakeholders.
The committee, chaired by Pulai MP Suhaizan Kayat, a lawmaker from Parti Amanah Negara, will hold two separate briefings: One for the industry and another for the regulators. They will meet representatives from the insurance and takaful associations, Bank Negara Malaysia (BNM) and the Ministry of Health (MOH).
There is so much to look into here. The problems with medical insurance are not new. Various issues have been raised in the past, including uncertainty about future probabilities and upward pressures on medical spending.
Researchers have talked about the different strategies that can be deployed. They include private funding, public funding plus public production and public funding plus private production.
Whatever the combination, one question remains: Is the premium hike in tandem with what’s happening on the ground?
In a statement released in July, the central bank clarified on commentaries related to the implementation of co-payment requirements for medical and health insurance and takaful (MHIT) products. Earlier, the central bank had released a policy document on the MHIT business, flagged as an important component of health financing in Malaysia.
The 52-page document made the following observations: “A number of significant developments are impacting the MHIT business, such as the rise in non-communica- ble diseases, growth of private healthcare services and escalating medical inflation. These have contributed towards an increase in the utilisation of medical services and magnitude of claims over the years.
“There has also been increased expectations for licensed insurers and takaful operators (ITOs) carrying on MHIT business to provide more comprehensive and inclusive coverage, as well as to account for the latest development in medical technologies and to support preventive care. These developments have placed increased focus on licensed ITOs to continuously innovate to meet consumers’ evolving needs while balancing the need to ensure that the MHIT business remains sustainable in the long term.”
In its clarification, BNM said that in 2023, Malaysia recorded medical cost inflation of 12.6%, which was significantly higher than the global average of 5.6%.
So, effective Sept 1, 2024, BNM said ITOs must offer consumers an option to purchase MHIT products with a co-payment feature.
It noted that consumers who have already purchased MHIT products without a co-payment feature can continue with their existing MHIT products at renewal. ITOs can also continue to offer MHIT products without a co-payment feature to new consumers.
In a statement on Nov 28, BNM came forward to acknowledge the concerns about the repricing of MHIT products by ITOs which, it said, has impacted policy owners/ takaful participants. It added that it has remained committed to ensuring that the public continues to have access to suitable insurance and takaful products.
In addressing the impact on consumers, the regulator said that it has required ITOs to review their current repricing strategies for more reasonable implementation of such repricing.
“This includes managing increases in premiums/contributions over time, taking into account the impact on policy owners/ takaful participants. In addition, ITOs are required to offer viable options for policy owners/takaful participants who are significantly impacted by the higher premiums/ contributions to continue having insurance/takaful coverage. ITOs must also ensure the options provided are meaningful and provide additional measures to support affected policy owners/takaful participants.
“Over the years, the cost of healthcare has risen significantly due to medical cost inflation and increased utilisation of medical services and procedures. Therefore, comprehensive and coordinated reforms to contain medical cost inflation will be critical to preserve continued access to appropriate MHIT protection,” it said.
The central bank has got it right about putting into place a complete and workable plan.
For a start, let us have a task force involving BNM, MOH and other stakeholders to dive deep into the matter. The group can rope in experts and eminent personalities to look into all aspects impacting the sector.
One key area is the regulation of private hospital charges. A cursory look at the billing leaves much to be desired.
The charges imposed by private hospitals are far from transparent. Some argue they are almost arbitrary. If they know you are covered by insurance, the charges immediately go up. That is the lived experience of medical insurance policyholders.
Then there is the health insurance premium against the claim experience. If claims keep increasing, premiums will follow suit. What is the solution?
As pressure builds up on government healthcare facilities, we need to quickly work out solutions on the medical insurance front.
Source : The Malaysian Reserve
PKR lawmakers call for joint task force to investigate rising medical insurance premiums
A joint task force comprising the Health Ministry and Bank Negara Malaysia should be set up to investigate whether medical insurance premium increases are tied to the private healthcare services costs, says a group of PKR lawmakers.
Sim Sze Tzin (PH-Bayan Baru) said the task force should include experts across the medical, actuarial science, public health policy fields and more to investigate, study and find a resolution.
He also urged independent bodies like the Public Accounts Committee to conduct proceedings and public hearings to investigate the situation.
“We don’t want to point the finger at anyone or curb private healthcare sector profits.
“We only want a sustainable and fruitful private healthcare ecosystem,” he told a press conference at the Parliament media centre on Monday (Dec 9).
Sim also pointed out the growing profits of two private healthcare groups over the past few years and questioned if it was due to medical insurance premium increases.
He added that the group of PKR MPs also received 197 email complaints regarding exorbitant private hospital fees since the campaign was launched several weeks earlier.
When asked if the complaints would be brought to the Parliamentary Special Select Committee on Health on Tuesday (Dec 10), Sim said they would do so if required.
“Backbenchers are also expected to receive a briefing by Bank Negara Malaysia tomorrow,” Sim said.
On Monday, The Star reported that Insurance players, Bank Negara Malaysia and the Health Ministry are set to appear before the Parliamentary Special Select Committee for Health for a hearing on the issue of rising insurance premiums.
“Feels Like An Annual Event” Rising Medical Insurance Premiums Hit Middle Class & Elderly Hard
Some Malaysians are considering ending their insurance policies after being informed about the premium hikes next year.
We’re always told that having insurance, especially medical insurance, is important in case we end up in the hospital for something major. However, most of us may not be able to afford medical insurance at the rate insurance premiums is rising.
According to a report by Utusan Malaysia, medical insurance premiums are expected to rise by 40 to 70% next year. Some policyholders have been informed of this impending increase through notices by their insurance providers with the common reason given being the rising healthcare costs at private hospitals.
This news has led some to consider stopping paying for their insurance policies and letting them lapse because they can’t afford to continue paying the steep price anymore.
A policyholder named Hamidi shared that he was paying RM188.47 per month and would need to pay RM237.34 when the price hike commences. He said his premiums increased from RM157.69 to RM188.47 last year and questioned why the premiums increased each year.
Hamidi said it’s a financial burden, adding that the premium increase has become an annual affair.
Another policyholder, Safie Wahab, plans to discontinue his policy when the time comes. He shared that his insurance premium had increased by RM133, from RM244 to RM377 per month.
The rising premiums definitely affect the elderly as well. In a letter to The Star, Tony Pereira said his medical insurance premium would increase 275% from RM540 to RM2,030 monthly because he’s reaching the age of 65 and a significant rise in medical treatment cost. He took up his insurance policy in 2010 at age 51 and was told he should have taken out insurance when he was much younger.
He was informed that if he opposed the increase, the investment within the policy would sustain his premium for a few months before the policy ultimately lapsed, leaving him without medical insurance entirely.
Meanwhile, Pereira took out the policy for his son at age 18. In just two years, his son’s medical insurance premium sees a rise of 30%.
He felt the levels of increase were unfair and punitive and wondered what Bank Negara Malaysia (BNM) would do to protect the public.
Pereira mentioned that insurance companies state that they are facing significant increases in the value of claims. However, Pereira said the company’s profit and loss (P&L) accounts look very healthy.
The expensive insurance premiums are already leading more people, especially the middle class, to public hospitals for medical treatment which adds to the crowding and overflow.
The domino effect may trickle down and hit insurance agents themselves when fewer clients can afford the expensive premiums. This could affect their commission rates and the company may face a high turnover.
Source : The Rakyat Post
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