Usage of Medisave for obstertrics services in M’sia

A few weeks ago I read a report in the Sunday Times with the headlines,  “PRs opting to give birth in Malaysia using Medisave” and I pondered if this will affect Thomson Medical’s market share.

Since 1st March 2010, Singaporeans and PRs could go to any pre-selected 12 hospitals in Malaysia for their obstetrics treatment and it will be subsidized by Medisave. The cost of treatment in Malaysia can be up to 50% cheaper than in Singapore. The hospitals involved in Malaysia in this scheme are owned either by Health Management International (HMI) and Parkway Holdings. Only these two groups can refer patients to its Malaysian counterparts from its hospitals here.

To date, HMI has referred 23 patients to its Malaysian hospitals. Out of these 23, 15 sought obstetrics treatment. Nine have already given birth and six are waiting to deliver. For the Parkway Holdings side, only 4 out of 16 referrals were related to births. This is a very small number compared to the total number of births in Singapore.

I don’t think the number of Singaporeans delivering in Malaysia will increase tremendously to affect TMC’s market share. This is because of the inconveniences faced by delivering in Malaysia.

Although there can be an advantage such as lower costs, it is troublesome to travel all the way to Malaysia just to deliver. Even though the facilities in some hospitals are on par with the Singapore hospitals, travelling and getting used to the way of life there might prove to be a bane. Also, if the newborn is to fall sick in Malaysia, the Medisave will not cover the hospitalization fees. To add on to the woes, parents who want to register their newborn as a Singapore citizen have to travel to Singapore High Commission in KL or Singapore Consulate-General in JB. This will surely be too much of an inconvenience, especially for the mother. The disadvantages far outweigh the sole advantage, lower cost.

I would have to wait for another one to two years at least to see how far this goes and if the trend changing towards deliveries in Malaysia. I will also scrutinize TMC’s FY2010 results to see if there has been an erosion of market share, which is very unlikely in my opinion.

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