By Dr David Quek

The new year 1998 augurs rather bleakly for Malaysians. Perhaps, for the first time, our contracted market and liquidity has finally dawned upon us, with a disturbing yet sobering awareness that all is not well.

Notwithstanding the imminent arrival of the portentous year of the Tiger, Malaysians are becoming apprised to the hard-nosed reality that the recent meltdown of our currency, our stock market, and the resultant monetary crunch, is already upon us. We can no longer deny or cocoon ourselves from this pervasive phenomenon.

Though we have previously enshrouded ourselves with the belief that we can weather this deflationary storm, with some head-in-the-sand equanimity, emphatic denial, jingoistic accusations, and nationalistic pride, we must perhaps now take stock and look the eye of the hurricane. We have to take the bull by the horns (or the bear by the paws) and tackle the myriad problems directly.

While many Malaysians may cry foul that they have been unjustly treated by the greed and predatory behaviour of the money traders, and while they may be absolutely right — it is becoming painfully clear that what these New Age plunderers have done — is perhaps simply to accelerate, even precipitate, the deflating pace of financial accountability and economic correction for the then extraordinarily bullish markets of Asia. In short, the timing just wasn't right, and was too sharply precipitous, but on hindsight not altogether too unexpected.

Our productivity growth has been suspect all along, particularly when one compares this with the exponential rise of wealth creation in the region. Our infrastructural and monetary — mostly internally generated — expansion and overdependence on focal and local niches of favoured businesses, led to the imprudent and extravagant use of short-term funds to finance long-term projects.

Our stock market and IPOs were treated ironically as legalised casinos, with ridiculously obscene returns for speculative wizardry. Paper gains from no brawn or productive sweat. I am reminded that there is no such thing as a free lunch. We cannot create wealth out of nothing, and certainly not by not working or producing goods or services that people would like to buy.

Unfortunately, this duplicitous scenario was blanked out from our consciousness, and only served to aggravate the deceptively abundant liquidity, which Asians prided themselves as having created.

Undoubtedly, this new and unaccustomed wealth and purchasing power, has made Asians more sure of themselves. And this accounted for their increasing articulateness and perhaps bargaining power in addressing international issues. Naturally, we do have that right to be heard and to espouse our much vaunted Asian values, even if we were dirt poor. But then, who would have listened then, as they do now — at least until recently, before the bubble burst?

However, in many respects, we have ourselves to blame for becoming too complacent, too trusting and too naive, in our dealings with the proffering lenders and fugacious investors (speculators) of hedge funds and currency players. We did not do our long-term projections and homework. We became myopic with a penchant for quick gains and amoral instantaneous gratification's. We allowed ourselves to become mired in the quicksand of deceptive liquidity, which engulfed us too quickly — we were literally caught with our pants down!

So what does 1998 have in store for Malaysians, and our Health Care system? For many, this will be a very difficult year of adjustment.

The monetary crunch will take its toll on every sector of the Malaysian economy. Most people will have less money to spend in an inevitable tide of rising prices of goods and services. It is even conceivable that some will lose their jobs and be retrenched prematurely. Unemployment will rise, as the market demands fewer workers due to a shrinking climate of opportunities.

It is expected that many people will resort to cheaper alternatives of health care services, if that has not already begun yet. Employers will encourage many of their workers to seek medical attention at public hospitals and health care facilities such as the state-run general hospitals, university hospitals and other centres.

We have already experienced corporate bodies directing their ill workers and retirees to seek medical attention or admission, only at designated facilities which are not privately-owned. Otherwise, they will not be reimbursed or guaranteed payment.

It is expected that public hospitals such as the outpatients' clinics, and even casualty departments will soon be seeing an overwhelming deluge of patients who seek cheaper and more affordable (even subsidized) health care.

It is expected that this will create an extraordinary strain on the seams of the already bursting health care amenities and manpower constraints in government hospitals and clinics. Government-employed health care staff are already bristling from the recent substantial cuts in their perks and salary adjustments, and their morale is not exactly cheery at the moment.

It is possible that many will be feeling even more disgruntled and disenchanted, and opt to leave the already underpaid public services, for greener pastures, thereby further aggravating the deficiencies within the system. At this point, it is worthwhile to emphasize that this timing would be quite off the mark if not disastrous, for new physicians in an already tight and shrinking market.

The corporatization of the universities without the attendant salary adjustments for clinical professors, lecturers, and ancillary staff, may suffer yet another bout of hemorrhaging departures. Sacrifice notwithstanding, the further slash in their clinical and entertainment allowances will be acutely felt.

The outlook appears rather dismal for the ill and the infirmed who might be subjected to less than their rightful expectations of optimal health care service.

For the private sector, this downturn may be even more sombre. Already, private hospitals and clinics have complained of some slow down, and decreasing turnover — in some, a decline of more than 50% has already taken place rendering their lobbies and walkways into shadowy ghost towns. The allure of 5-star comfort and services, is no longer that important in this final reckoning when funds and liquidity are scarce.

Patients have begun not following up regularly. They are asking for cheaper medicines or their alternatives. Many are deferring less urgent surgeries or procedures, with increasing numbers asking to refill their prescriptions without wanting to consult their physicians. Some patients have begun requesting transfer to government facilities.

Overall, we will be facing a reality crunch. We will have to expect to earn less, spend less, and even to suffer some default and bankruptcies. But what can we do to help in this forecast of gloom and doom? Are we over-reacting and exaggerating our liquidity woes? Perhaps, but to be forewarned is to be fore-armed.

Recently, there has been a quietly recurring plea among senior members of the profession, for doctors and health care owners to hold a moratorium on charges and fees. Some reduction in charges is even suggested – for ward charges, laboratory fees, use of the operating theatres, surgical equipment, and even pharmaceutical mark-ups.

Perhaps physicians and surgeons can take the first step by maintaining their professional fees, despite the ongoing inflationary pressure to increase. Many doctors are understandably reluctant to reduce their fees as most of them have been following the guidelines from the MMA schedule of fees. And they emphasize that the MMA schedule of fees has not been modified or changed for many years. Furthermore, the economic downturn has already affected their bottom line. Many are feeling the crunch and are feeling rather angry yet helpless, at this unexpected turn of events.

Certainly, it is true that our medical fees have not risen in tandem with even the lowest estimate of inflation, unlike many other professional bodies. This has always been the sore point among doctors — who feel that because of their calling, they have to be burdened with the additional yoke of benevolence and charity expected of them. Besides, quite a number are already charging below the rates advocated in the schedule.

However, some surgeons and physicians have mentioned that they are already responding to market forces by voluntarily adjusting their fees downwards. Quite a number of family physicians have admitted to becoming even more sympathetic to their regular patients' plight of diminishing purchasing power, and are offering their best efforts to assist these unfortunate people in this time of need. We foresee more and more doctors who will graciously and anonymously treat patients on a charitable basis, as the economic regression deepens. Perhaps at this juncture, it is right to applaud these doctors for their humanitarian gesture.

True, they will be earning somewhat less, but they certainly won't starve either. Their quantum of earnings is perhaps smaller, that's all. But this gesture, I think, will be welcomed by the public who will appreciate their sacrifices, which they can rightly expect of their doctors, in this time of economic contraction.

However, this moratorium should be more than just a public relations ploy, and should go a long way in allaying the fears that our private health care services might have been escalating too much, with their runaway costs. For instance, it is cynical to publicize the much-flaunted and abused "we'll match the public donations for needy patients" catchphrase, and then go on to surreptitiously inflate surgical or hospital charges.

Dare I call on all doctors to play their role in trying to maintain or even to reduce their charges for their patients, excepting perhaps for certain pharmaceutical items which should be reasonably priced (this is rather difficult in view of the much depreciated ringgit which has made the import of many new but still patented drugs, some 30% more expensive)?

Of course, this will be tough. It may not be possible for certain investigations which depend on imported (due to lack of compatible or quality local) materials. For example, to do a stress ECG, thermal recording paper has jumped almost 30%, as have the disposable electrodes. But most physicians and hospitals would have already paid up their leases, and thus will not incur more by being able to offer the use of this machine at a cheaper rate.

This will also be true of X-rays, CT scans, MRIs, laboratory tests, cineangiographic services, etc. We can also rightly expect the landlords of private clinics to be in tune with the times, and perhaps also offer a reduction in their rentals, for this offer to succeed, so that individual physicians can participate by lowering their monthly overheads. Re-negotiation of leases can be made annually to help facilitate this flexibility which will benefit all in the long term. Selfish quick returns are clearly no longer going to work.

Admittedly, it is the quantum of earning that is at stake. In times of limited liquidity, everyone earning a little less is better than, not earning anything at all. Therefore, are we willing to accept somewhat less for our professional services? Will more individual doctors start the ball rolling by taking the first tentative steps?

This is the time to chip in and sacrifice some profits for the sake of our patients, and for the nation. This is not simply altruistic, because it will benefit the private sector and medical practitioners in allowing them to maintain their turnover and prestige, with the notion that they will inherit their patients' favour and long-lasting gratitude, when better times return.

Hopefully, this economic downturn will be over in the next 2 or 3 years, and we can all look back with sanguine memories that we have done right, by doing that little bit more.

/Jan 98

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