KUALA LUMPUR: Malaysia's private healthcare operators are expected to face little near-term financial impact from the government's planned transition to a diagnosis-related groups (DRG)-based payment system, as the rollout will be gradual, RHB Research said.
Analyst Eddy Do said a key takeaway from Bank Negara Malaysia's Sasana Symposium was the planned introduction of a DRG-fee-for-service (DRG-FFS) hybrid adjustment mechanism to ease the transition.
Although DRG pricing could eventually limit hospitals' ability to grow revenue through itemised billing, such as drugs, laboratory tests and consumables, Do expects the impact to remain limited in the near term.
"Participation in DRG remains voluntary until the necessary systems and data infrastructure are in place.
"DRG-based rates currently apply only to the newly introduced MediAsas product, while the phased rollout of the DRG-FFS hybrid adjustment mechanism is expected to support the transition to DRG-based pricing," he said in a note.
What To Read NextDo said regulators also acknowledged operational risks seen in DRG systems globally, including "DRG creep", early patient discharges, selective patient admissions and back-end billing practices.
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Separately, he said the onboarding of major private hospital operators onto the Malaysia digital health certification network marks progress in improving the exchange of health data between the public and private sectors.
The network is built on a "One Person, One Record" architecture based on International Patient Summary standards.
Its initial participants include KPJ Healthcare Bhd, IHH Healthcare Bhd, Sunway Healthcare Bhd, Selgate Specialist Hospitals, MAHSA Specialist Hospital, Mahkota Medical Centre and the digitalised public healthcare system.
Do said private hospitals had been reluctant to share patient data because of privacy concerns and administrative hurdles.
"Nevertheless, we believe the network addresses these concerns through a patient-mediated, explicit consent framework, giving patients control over their data and enabling time-bound access approvals via MySejahtera," he said.
RHB Research maintained its "Overweight" call on the healthcare sector, with KPJ Healthcare Bhd, Duopharma Biotech Bhd and LAC Medical Group Bhd as its top picks.
Do said KPJ is best placed to benefit from medical and health insurance/takaful reforms and wider DRG adoption, given its extensive network of secondary and community hospitals, lower cost base and capacity to handle higher patient volumes.
