GST may impact hospital bills, says KPJ

APRIL 22, 2014

MD Amiruddin: Hospital services exempt, but medicines and medical supplies
will be taxed. — Courtesy of KPJ

KUALA LUMPUR, April 22 — KPJ Healthcare Bhd is working to ward off of a possible impact on hospital bills when the goods and services tax (GST) comes into effect next year.

KPJ, which is aiming for revenue growth of 10 per cent this year, expects its costs to go up 3-5 per cent a year.

KPJ president and managing director Amiruddin Abdul Satar said although hospital services were exempt from GST, medicines and medical supplies would be taxed.

“There will be some impact on hospital bills when GST is implemented next year,” he told reporters at a tea gathering for media here yesterday, according to The Sundaily. “Definitely private hospitals will pass on the input tax that we have to pay in medicine and medical supplies.”

GST increased costs of labour and medical supplies, as well as costs to upgrade facilities and costs of new equipment, Amiruddin said.

“We improve our efficiency through bulk purchase of medical supplies,” he said.

KPJ was spending RM17 million to develop a cloud infrastructure to provide seamless healthcare services to over 2.5 million patients annually, Amiruddin revealed. It aims to complete its migration to the cloud infrastructure by the end of next year.

The cloud infrastructure will improve efficiency, reliability and flexibility, cut costs, and allow the private healthcare provider to roll out new applications at existing and new hospitals.

Amiruddin said KPJ was aiming to open a 30-bed hospital in Muar before the end of June, and was planning to start work on its flagship hospital Bandar Datuk Onn Specialist Hospital in the Iskandar region in Johor.

“It (Bandar Datuk Onn Specialist Hospital) is to be opened in the next two years, targeting foreign patients, mainly from Singapore and Indonesia,” he said.

KPJ is also building the Pahang Specialist Hospital and the KPJ Perlis Specialist Hospital. It plans to start building on the land it acquired in Malacca before the end of the year, and has called for tender to staart work on its hospital in Miri, in Sarawak.

“We’re also expanding hospitals that have reached a maximum capacity, which are KPJ Ampang Puteri Specialist Hospital and KPJ Seremban Specialist Hospital,” he said.

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