Membership: Full Members

Governance and stewardship.

Malaysia's health policy is intertwined with the goals for national development, rural development, and socio-economic equity between ethnic groups.

The Context

After independence, the number of rural clinics increased significantly and the rural health service formed the backbone of Malaysia’s primary health care infrastructure. During this time, a referral system was established within the public sector that extended from primary care clinics to district hospitals, state hospitals, regional hospitals, and general hospitals in the major urban centers. Hospital care was almost completely provided by the public sector. However, since primary care in urban areas was provided almost exclusively through the private sector on a for-profit basis, the system could not be thought of strictly as a national health service.

Key Reforms

Malaysia’s health sector is guided by a series of ten-year and five-year plans known as the Outline Perspective Plan (OPP) and the Five Year Malaysia Plan, respectively. The fourth OPP (2011-2020) and the tenth Malaysia Plan (2011-2015) are currently operational.[1] Policy making in Malaysia is also guided by a national long-term plan. The current long-term plan is Vision 2020, which was launched in 1991 and calls for Malaysia to be a fully developed country by 2020. The Vision for Health is “to develop a nation of healthy individuals, families and communities, through a health system that is equitable, affordable, efficient, technologically appropriate, environmentally adaptable and consumer-friendly, with emphasis on quality, innovation, health promotion and respect for human dignity, and which promotes individual responsibility and community participation towards an enhanced quality of life.”[2]

Between 2001 and 2005, the Malaysian National Health Accounts project created a system for classifying and coding health expenditure data according to sources, providers, and functions. This led to a health expenditure report for 1997-2002. A National Health Accounts unit was established in the MOH to continue producing data, which is currently being gathered for the time period 2003-2008. These efforts will prove important if Malaysia embraced some form of social health insurance in the near future.

Since the rise of private health sector in the 1980s, there has been an ongoing drain of doctors and specialists from the public to the private hospitals. In order to retain doctors in the public sector, better allowances have been introduced, especially for those serving in rural areas. Other strategies include enhanced prospects for promotion and more opportunities to further postgraduate training. The public sector has also stepped up its efforts to recruit foreign doctors and specialists in addition to hiring private practitioners on a seasonal basis. In order to address a shortage of specialists within the public sector, specialists have been allowed to take on private patients within public hospitals through the Full Paying Patient scheme. The MOH has also introduced new entry posts for doctors so that the grade of appointment of specialists will be based on qualifications and experience instead of seniority.[3]

Since the Seventh Malaysia Plan introduced in 1996, the government has indicated its intention to move away from health care service provision and towards regulation and stewardship of the health system. The government is aware that an aging population, along with more advanced medication and equipment, rising demand for quality healthcare, and changing disease patterns will likely lead to higher costs in the future. This has led Malaysia to consider a new national financing scheme for the health sector. Both the Seventh and Eighth Malaysia Plans mentioned that a health financing scheme would be implemented in order to finance health care costs.[4] The Tenth Malaysia Plan, written in 2010, again calls for a clearer demarcation between the regulatory and service delivery functions of the Ministry of Health (MOH). It calls for the MOH to focus primarily on governance, stewardship, and enforcement of regulations while continuing to upgrade and expand public health facilities. The primary goal for the MOH will be to enhance the quality of care in both the public and private sectors and to ensure patient safety. This plan also calls for a review of available financing options for the health system in order to more effectively manage rising costs.

In 2009, the MOH introduced a concept paper entitled “1Care for 1Malaysia: Restructuring the Malaysian Health System,” which outlines a broad strategy for redefining the manner in which the health system operates. It emphasizes the move of the MOH towards governance and stewardship of the health system. Under this plan, the daily care of patients would be transferred to an autonomous Malaysian Health Care Delivery System (MHDS), which would integrate public and private health care providers and services. This move would allow for more competition between providers with the goal of eliciting higher quality of care and greater efficiency. In order to facilitate this process, health financing would be restructured into a mandatory social health insurance (SHI) fund that would be publicly managed on a not-for-profit basis. SHI premiums were estimated at 9.5% of household income, which would come from the government, the employer, and the employee. The proposed National Health Financing Authority (NHFA) would be responsible for managing the financing of the system. The Primary Health Care Trust (PHCT) would be an autonomous agency under the MHDS responsible for purchasing health services from primary care providers/contractors, dentists, and pharmacies in both the public and private sectors. It would also commission services from secondary and tertiary care providers such as hospitals and emergency services. Under the new system, every individual would be registered with a Primary Health Care Provider (PHCP) and financing would be through capitation with case-mix adjustments based on the community’s health profile. Services from public hospitals would be funded through a global budget based on Diagnostic Related Groups and services from private hospitals would be financed through case-based payments. This concept paper was submitted to the Economic Council for review and approval to develop a detailed blueprint for the restructuring process.[5] The development of a blueprint on the Health System Transformation, which was initially to be completed by 2012, has now been deferred to 2014.[6]

[1] Ministry of Health Malaysia 2009
[2] Merican, Rohaizat, Haniza
[3] World Health Oranization 2010b
[4] Dar Ren
[5] Ministry of Health Malaysia 2009b
[6] Ministry of Health Malaysia 2011b

Country Core Group Representatives

Rozita Halina Tun Hussein