Al-`Aqar Healthcare REIT Annual Report 2020

AL-`AQAR HEALTHCARE REIT Annual Report 2020 48 3. Malaysia Healthcare Over the last five years, Malaysia has consistently spent 4% to 4.2% of its GDP on healthcare which is lower than the 2019 OECD average of 8.8%. This stagnant spend on healthcare, however, might be challenging given the rise in healthcare costs in the country and across the ASEAN region as a whole. With the impact of COVID-19 and its resultant lockdowns, healthcare spending in Malaysia is projected to decrease by 2% to 3% in 2020. The recently released Malaysian budget 2021 recorded an increase of 4% in allocations for the Ministry of Health (MOH) to RM31.9 billion (US$7.8 billion) as compared to the previous year. In light of these budget cuts, it is uncertain whether the country will be able to raise its health expenditure to WHO standards which recommend countries spend at least 7% of their GDP on health. POISED FOR GROWTH Malaysia’s healthcare challenges. Malaysia’s dual-tier healthcare system consists of a government-based universal healthcare system and a private healthcare system. As the majority of the population is served by the public healthcare system, it puts burden in terms of infrastructure on the public hospitals and clinics. Long waiting times, delay in diagnosis lead to inefficiency in the healthcare system that defeats the aim of providing healthcare access to all, at affordable costs with best patient experience. The divide between the public and private sector with no collaborative provisioning of services is a challenge that can be resolved through public-private partnerships. There needs to be sharing of infrastructure, purchasing of services at a cost that will benefit the service providers and the patients. The 2021 budget allocated RM4.7 billion for the development of the healthcare sector in Malaysia with RM71 million towards fostering public- private partnerships in the industry. 2021 BUDGET ALLOCATED RM71 MILLION TOWARDS FOSTERING PUBLIC-PRIVATE PARTNERSHIP IN HEALTHCARE SECTOR DIGITAL TECHNOLOGY AS A BRIDGE BETWEEN PRIVATE AND PUBLIC HEALTHCARE SYSTEMS IN MALAYSIA Malaysia’s healthcare opportunities. About 8.1% of the adult population (1.7 million people) in Malaysia have all three risk factors of diabetes, hypertension and high cholesterol that led to chronic diseases. Half the Malaysian adult population were overweight or obese in 2019. This leads to the point of early diagnosis and prevention than treatment approach that can help reduce mortality and the burden on healthcare costs. Digital health solutions such as digital health tracking devices, health coaching and mental health apps can help the population be healthy. allocations for the Ministry of Health (MOH) RM31.9 billion allocated for the development of the healthcare sector towards fostering public-private partnerships in the industry RM4.7 billion RM71 million adult in Malaysia have all three risk factors of diabetes, hypertension and high cholesterol 1.7 million Market Report Summary