Page 51 - LIAM Annual Report 2020

ANNUAL REPORT 2020 49

HEALTH CLAIMS STUDY & HEALTHCARE PROJECTS
A leading consultant firm, Actuarial Partners Consulting (APC),
was engaged to conduct the Healthcare Cost Study in 2019,
with the objective to identify the main drivers that lead to the
persistent rise in the cost of medical premiums and to provide
high level recommendations to address this trend.

APC completed the Study Report on “Identifying and Quantifying
the Healthcare Cost Drivers in the Insured Healthcare Ecosystem
in Malaysia” in July 2020.

The Report provided 12 recommendations to address the rising
medical costs issues and these recommendations have been
categorized into 4 Workstreams in accordance to priority of
implementation.

Workstream 1 – Digitalisation, Standard Billing Format,
Reasonable and Customary Database and Publication of
Hospital Procedures
Workstream 2 – Pricing and Innovation of MHI Plans

Workstream 3 – TPA Requirement
Workstream 4 – Others

The Medical Cost Containment Task Force and the Working
Group (WG) are now focusing on Workstream 1 to explore
a common digitized platform for exchange of information
on issuance of guarantee letters and submission of hospital
bills between Insurance and Takaful Operators/Third Party
Administrators with private hospitals.

IFRS/ MFRS 17
LIAM has engaged Ernst & Young (EY) to
prepare the industry for the implementation
of IFRS/MFRS 17 since October 2018 and
has further extended the service of EY to
31 December 2021. EY will be conducting
6 forums for LIAM members in 2021.

Since the engagement of EY, 14 forums
have been conducted and 10 Guidance
Notes have been completed and
circulated to member companies.

The project is progressing well as
scheduled for the implementation of
IFRS/MFRS 17, which has been deferred
to 2023. The introduction of IFRS/MFRS 17
– the Accounting Standard for Insurance
Contracts, will see a significant change to
insurance accounting requirements in 20
years. It requires a complete overhaul of
insurers’ financial statements and affects
mainly life insurers because of their long-
term contracts.