KPJ Healthcare Bhd, which is targeting a 10% revenue growth this year, warned of a possible impact on hospital bills when the goods and services tax (GST) is implemented next year, as it expects its own costs to go up between 3% and 5% annually.
KPJ president and managing director Amiruddin Abdul Satar said private hospitals in Malaysia are not spared from the impending GST. Although hospital services are exempted from GST, medicines and medical supplies will be taxed.
"There will be some impact on hospital bills when GST is implemented next year. Definitely, private hospitals will pass on the input tax that we have to pay in medicine and medical supplies purchased from suppliers," he told reporters at a media hi-tea here yesterday.
Amiruddin said increasing costs are incurred partly because of GST, increased labour and medical supplies costs, as well as the costs for upgrading of facilities and new equipment purchase.
"We improve our efficiency through bulk purchase of medical supplies and we have the economies of scale to have good prices from suppliers to bring down our costs," he added.
Meanwhile, KPJ is spending RM17 million to develop a cloud infrastructure to provide seamless healthcare services to over 2.5 million patients annually. It is targeting to complete its migration to the cloud infrastructure by the end of 2015.
The cloud infrastructure will enable KPJ to operate at a reduced cost and with greater efficiency, reliability and flexibility and allow the private healthcare provider to roll out new applications at existing and new hospitals.
On the group's hospitals updates, he said KPJ is targeting to open a 30-bed hospital in Muar before end-June and is planning to start construction of 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 constructing the Pahang Specialist Hospital and the KPJ Perlis Specialist Hospital. It plans to start construction of the land it acquired in Malacca before year-end and has called for tender to commence construction for its hospital in Miri, Sarawak.
"We're also expanding hospitals that have reached a maximum capacity, which are KPJ Ampang Puteri Specialist Hospital and KPJ Seremban Specialist Hospital."
