Latest news with #KuljitSingh
BusinessToday
2 days ago
- Business
- BusinessToday
Private Healthcare Sector Faces Rising Medical Inflation Pressures, CIMB
Malaysia's private healthcare sector is grappling with rising medical inflation and potential structural changes as discussions advance on the adoption of a diagnosis-related group (DRG)–based hospital payment system, according to insights from a recent meeting between CIMB Securities and Datuk Dr Kuljit Singh, President of the Association of Private Hospitals Malaysia (APHM). Private hospitals currently cater to about 30% of Malaysia's patient load—funded primarily through self-payment, personal insurance, and employee benefits—while the public sector supports the remaining 70%. Dr Kuljit highlighted that Malaysia's healthcare quality remains on par with, or better than, many ASEAN peers, sustaining the nation's appeal as a medical tourism hub. Medical Inflation Above Global Average Bank Negara Malaysia (BNM) data shows that medical inflation hit 15% in 2024, surpassing the global average of 10% and the Asia-Pacific average of 11%. Key cost drivers include the adoption of advanced medical technologies, rising medical supply costs, manpower shortages, and overall inflationary pressures. Between 2021 and 2023, claims in the Medical and Health Insurance/Takaful (MHIT) segment surged 73%, outstripping the 21% growth in premiums. Claim frequency more than doubled to 25 per 100 policyholders in 2023 from 11 in 2018. In response, BNM has capped annual premium increases at 10% until the end of 2026, with hikes staggered over three years. Dr Kuljit cautioned that prolonged premium caps could prompt insurers to tighten reimbursement terms and limit hospital or treatment options, potentially curbing investment in private healthcare. To mitigate rising claims, private hospitals are offering negotiated discounts to insurers, which in turn lower out-of-pocket costs for insured patients compared with self-paying patients. Exploring DRG to Curb Costs The proposed DRG system would replace the traditional fee-for-service model with fixed prices for treatments based on case complexity and industry benchmarks. APHM is working with the Ministry of Health to collect and standardise data for a private healthcare DRG database. However, implementation challenges remain due to the lack of a universal healthcare financing framework and comprehensive private-sector data. Globally, DRG models are largely confined to public healthcare systems, with limited adoption in private healthcare. Dr Kuljit noted that complications or additional care beyond the DRG package often create billing and coverage issues in private settings. Sector Outlook CIMB Securities noted that KPJ Healthcare Bhd could be more exposed to DRG-related risks, with 98.1% of its revenue derived locally in 1Q25, compared with IHH Healthcare Bhd's 18–21% Malaysian revenue contribution. The brokerage maintains an Overweight stance on Malaysia's healthcare sector, citing its defensive nature, resilient demand, organic expansion, and favourable demographics. IHH remains its top pick with a Buy rating and a target price of RM8.50, trading at attractive valuations relative to historical and regional averages. KPJ is rated Hold with a TP of RM2.90, as its current share price is seen to have priced in recent operational improvements.
The Star
3 days ago
- Business
- The Star
DRG model still challenging for private healthcare
Unlike the conventional fee-for-service model, the DRG system sets a fixed price for treatments based on case complexity and industry benchmarks. PETALING JAYA: Malaysia's diagnosis related group (DRG) model to manage rising healthcare costs and allocate medical resources remains a challenge for implementation in private hospitals, analysts say. This is despite efforts to find solutions, including data collection. The issue is compounded by absence of a universal healthcare financing system in Malaysia. Unlike the conventional fee-for-service model, the DRG system sets a fixed price for treatments based on case complexity and industry benchmarks. According to Bank Negara data, medical inflation in the country reached 15% last year compared with the global average of 10% and the Asia Pacific average of 11%. For insurers, this becomes a problem as claims rose by 73% between 2021 and 2023 while premiums collected only increased by 21%. CIMB Research, who spoke to Association of Private Hospitals Malaysia (APHM) president Datuk Dr Kuljit Singh, said implementation of the DRG model in private hospitals could be challenging due to the absence of a universal healthcare financing framework and limited data availability despite efforts focused on generating and collecting data. The research house, quoting Kuljit, noted that no robust DRG models exist globally for private healthcare except in cases involving a single funder or universal healthcare financing. Public hospitals have all come under a mix of the DRG model and annual budgets to fund and provide for healthcare. 'Most countries use DRG in public healthcare to calculate costs and determine government budgets. In private settings, challenges emerge when patients face complications or require additional care beyond what the system covers,' the research house said, adding that the lack of data accuracy makes an effective rollout of the DRG model challenging for private hospitals. Despite the challenges, Kuljit shared that APHM-affiliated hospitals have been working closely with the Health Ministry and holding regular engagements to support an effective rollout of the DRG model. CIMB Research has maintained an 'overweight' stance on healthcare stocks, underpinned by the defensive nature of such stocks and the demand for private healthcare. Growth prospects remain supported by organic expansion, the rising prevalence of non-communicable diseases and an ageing population. IHH Healthcare Bhd remains the research house's top pick with a 'buy' call and target price of RM8.50. It has a 'hold' rating on KPJ Healthcare Bhd with a target price of RM2.90. 'Within our coverage, we believe KPJ is more exposed to risks from the possible implementation of DRG in Malaysia, given that 98.1% of its revenue for the first quarter for this year (1Q25) was derived locally. 'In comparison, we estimate Malaysian operations contributed only 18% to 21% of IHH's 1Q25 revenue,' the research house said. IHH has a presence across Malaysia, Singapore, Turkiye, Europe and India.
Mint
4 days ago
- Automotive
- Mint
Green hydrogen infrastructure along highways is next on India's transport map
New Delhi: After rolling out public electric vehicle charging stations, India is now turning to green hydrogen fuel infrastructure along national highways. As part of the government's energy security push, the ministry of road transport and highways (MoRTH) will start a ₹600 crore pilot project on 10 select highway stretches to test fuelling and repair facilities for hydrogen-powered vehicles, according to two officials aware of the development. It will evaluate whether sufficient green hydrogen supply can be ensured for commercial vehicles while also setting standards for fuelling stations and storage systems. The trials, to be conducted in different regions, will assess not just technical and supply-chain feasibility but also geographical and logistical challenges before the programme is rolled out nationwide, the people said. The ministry is in talks with state-run refiners Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) to develop hydrogen storage and fuelling stations along these stretches. The plan also includes incentives for steel and automobile manufacturers to develop prototypes of hydrogen vehicles and storage systems, said one of the officials, requesting anonymity. Tata Motors, Ashok Leyland and Volvo Eicher Commercial Vehicles are expected to participate in the pilot, which will eventually be extended to all national highways, the second official said also requesting anonymity. 'The entire plan is being included in the Vision 2047 mission of MoRTH, and its implementation is expected to be completed over the next two to three years so that hydrogen highways become a reality," said the second official. Emails sent to the ministry, IOCL, HPCL, BPCL, Tata Motors Ltd, Ashok Leyland Ltd, and Volvo Eicher Commercial Vehicles Ltd on Tuesday remained unanswered till press time. Focus on hydrogen The initiative aligns with India's target of net-zero emissions by 2070 and follows the government's ₹19,744 crore National Green Hydrogen Mission, which aims to produce at least 5 million metric tonnes of green hydrogen annually by 2030. The government's focus on hydrogen can diversify India's efforts to reduce carbon emissions on roads, which contribute to about 12% of the country's total emissions. 'This marks a positive first step toward diversifying green fuel options for transportation, preventing over-reliance on EVs. To make it truly effective, a clear master plan is needed to rapidly expand hydrogen infrastructure nationwide, as widespread access will be critical for the adoption of hydrogen-powered vehicles," said Kuljit Singh, partner and national infrastructure leader, EY India. Hydrogen highways are seen as a potential solution for long-haul freight and heavy-duty vehicles, where EVs face range and charging limitations. 'While green highways with EV infrastructure address the needs of passenger mobility and short-haul freight, hydrogen highways can cater to long-haul, heavy-duty commercial transport where battery limitations in range and charging times become bottlenecks. The proposed pilot projects will be critical in testing technical viability, cost economics, and safety protocols under Indian conditions before scaling up," said Jagannarayan Padmanabhan, senior director and global head of consulting, Crisil Intelligence. The efforts to bolster adoption of electric and hydrogen vehicles by creating viable infrastructure need not be mutually exclusive at a time when consumers are increasingly choosing new vehicles based on powertrains instead of other features, said Padmanabhan. 'This dual approach would give India flexibility as technology, costs, and energy sources evolve over the next decade," he said. Tata Motors Ltd, the country's largest commercial vehicle maker by sales, had said in a statement in March this year that it had started testing 16 hydrogen-powered trucks on Indian highways. These vehicles run on hydrogen internal combustion engines or hydrogen fuel cells. Hydrogen is currently in limited public use. State-run NTPC Ltd deployed hydrogen buses in Leh in June after opening its first hydrogen fuel station in the region in November 2024. In FY25, 16 new hydrogen fuel cell vehicles were registered in the country, according to MoRTH's Vahan registry, while only one unit was sold in the year. Hydrogen is made by separating the water molecule using electrolysis. Green hydrogen is produced in the same process when renewable energy sources, such as solar energy, are used for electrolysis. The technology is still at a very nascent stage. "The economics of green hydrogen vis-a-vis other competing fuels are not cogent enough to drive a strong demand as a vehicular fuel as of now. Nevertheless, setting up of infrastructure would enable seeding the market," said Prashant Vasisht, senior vice president and co-group head, corporate ratings, Icra Ltd.
New Straits Times
20-06-2025
- Health
- New Straits Times
Private hospitals back EPF plan for insurance payments, call for safeguards
KUALA LUMPUR: The Association of Private Hospitals Malaysia (APHM) has hailed the government's timely proposal to allow Employees Provident Fund (EPF) members to use their Account 2 savings to pay for monthly health insurance premiums. Its president, Datuk Dr Kuljit Singh, said while the plan is welcomed, it must be accompanied by clear safeguards to ensure its long-term sustainability. He said the responsibility now lies with the relevant agencies to determine the most appropriate funding model, whether through EPF or other mechanisms. "APHM fully supports the development of well-designed, evidence-based and data-driven policies, including the proposed basic MHIT (Medical and Health Insurance/Takaful) product. "Key stakeholders such as Bank Negara Malaysia, the Health Ministry, and the Finance Ministry will play pivotal roles in determining the best approach moving forward. "What matters most is that the mechanism serves the people effectively and remains financially viable in the long term," he told the NST. Dr Kuljit said APHM remains committed to working with all stakeholders to address challenges in healthcare financing and the rising cost of treatment. "Our member hospitals are ready to share data, insights, and industry expertise with the government to support policies that are both sustainable and beneficial to all Malaysians," he said. The government proposed the EPF plan to ease healthcare costs, widen insurance access, and relieve pressure on public hospitals. Health Minister Datuk Seri Dr Dzulkefly Ahmad said yesterday that if the proposal is implemented, 16 million EPF contributors could use their savings to access medical care at private hospitals.
The Star
10-06-2025
- Health
- The Star
Long, winding road towards DRG payment model rollout
KUALA LUMPUR: A proper rollout of the diagnosis-related group (DRG) payment model could take more than six months, given the complexities in data gathering and analysis, said Association of Private Hospitals Malaysia (APHM) president Datuk Dr Kuljit Singh. He said that for any DRG or any DRG-type mechanism to work, accurate clinical data and a national electronic health record system are needed. Presently, this foundational data is not yet available, which presents significant challenges for timely and effective DRG implementation, he added. 'As the process of gathering and analysing such data is complex and time-consuming, APHM anticipates that a proper rollout will require considerably more than six months,' said Dr Kuljit. He also said the APHM is heartened to hear Health Minister Datuk Seri Dr Dzulkefly Ahmad's announcement at the APHM International Healthcare Conference and Exhibition 2025 that a basic medical and health insurance/takaful (MHIT) product will be introduced later this year, while the DRG will be rolled out in phases. To support this national initiative, Dr Kuljit said APHM member hospitals have offered to share relevant clinical data required for the set-up of a DRG system with the Health Ministry and the Finance Ministry. 'APHM strongly advocates that adequate time and resources be allocated to ensure that the DRG initiative is thoroughly conceptualised, piloted and implemented to ultimately deliver sustainable improvements for all Malaysians,' added Dr Kuljit. Earlier, Dzulkefly said introducing DRGs to pay for healthcare services, in phases, beginning with MHIT products, will be a key driver for value-based healthcare.
