GST: APHM happy Health Ministry understands private medical care fee hike

The Association of Private Hospitals of Malaysia (APHM) is trigger happy that the Health Ministry understands why the cost of private healthcare will be increased after the Goods and Services Tax (GST) implemented, next April.

APHM president Dato’ Dr Jacob Thomas lauds the move as positive as it will encourage private hospitals to be proactive in partnering with the Government in the future.

“Generally, private hospitals are complex. Most private doctors working in private hospitals are independent consultants. They are not employees to the private hospitals but have very close working relationship with the hospitals. This is different from the medical officers in public hospitals.

“The Royal Malaysian Customs Department considered the healthcare professionals like specialist doctors, medical practitioners working in private hospitals as “outsourced services” and their services will be charged with a six per cent tax, which will paid by patients who are seeking treatment,” he added when contacted by Astro AWANI.

Jacob cautions the public to be prepared to pay an additional five per cent for private hospitals services after the GST is implemented.

“As APHM represents private hospitals, we have had several consultations and discussions with the RMCD and the Ministry of Finance concerning issue and implications arising from the decision with regard to healthcare services provided by healthcare professionals as outsourced services.

“However, our appeal to the government for healthcare services to be regarded as Exempt Supply for both private hospitals and healthcare professionals, was rejected,” he added.

He said patients seeking healthcare services in private healthcare facilities will be faced with two invoices – one from the private healthcare facilities (exempt) and the other from the healthcare professionals which constitutes a six per cent GST.

Yesterday, Health Minister Datuk Seri Dr.S. Subramaniam confirmed the cost of private healthcare will increase after GST is implemented but the details on the rate are still being fine-tuned with the Custom Department, reported The Malay Mail Online.

Subramaniam, said at a press conference no final decision has been reached yet but he did discount any allowance that there will be an increase in private healthcare costs.

He was responding to a statement by Jacob on three days ago which warned the public to be prepared to pay an additional five per cent for private hospital service after GST is implemented, claiming the RMCD has refused to exempt the tax for the private doctors they hire.

Subramaniam said he has already highlighted the matter to the GST agency, labelling it as a “peculiar problem”.

“We have explained this to the GST team and the private hospital have also explained it, so we have to wait for the decision from the Finance Ministry and the Customs as to what is the best approach,” said Subramaniam.

During the tabling of Budget 2015, the Prime Minister Datuk Seri Najib Tun Razak said the government will implement the Goods and Services Tax (GST), effective April 1, 2015 at a fixed rate of six per cent to replace the Sales and Services Tax at 16 per cent.