Axis Capital, a global insurer and reinsurer, providing clients and distribution partners with a broad range of specialized risk transfer products and services, a group of companies with branch offices in Bermuda, Australia, Canada, Europe, Latin America, Singapore and the United States is at one with the universal healthcare for Indonesia.
Profound to prevent the system becoming broke and to avoid deceit, the Health Ministry has agreed low reimbursements levels for hospitals. Even though a big number of hospitals (1,720 out of Indonesia's total of 2,300) have contracted up for JKN, the low reimbursements are sooner or later to be expected to reduce the attention of private clinics and hospitals, indicating to congestion in state facilities. They will likewise regulate the value of health care and force individuals who can have enough money to do so to search for higher-quality care somewhere else, most probably from private insurance providers.
Hitherto, the part of private insurers in Indonesia's innovative reforms is uncertain. The government has not stipulated transitional preparations for employers that have gotten private health insurance for their workers, making them to pay twofold. Nonetheless private insurers are anticipated to benefit from a general shift headed for insurance coverage in a market where 75% of private health spending was out of pocket in 2010, according to the World Health Organisation. This will be specifically true if Indonesia's economy grows robustly, boosting the growth of the middle class.
The execution of the JKN seems to bring many opportunities and reviews for pharmaceutical companies and medical devices providers. Though, the almost certainly beneficiaries are local pharmaceutical companies manufacturing generic drugs, which already have a 70% share of the local drug by volume. According to Health Minister Nafsiah Mboi, in order to lower costs, doctors participating in the JKN will have to adhere to a government formulary, which consists of 92% generics and 2.5% innovator drugs. The rest is accounted for by dental materials and diagnostics.
The application of JKN will also leave the present regulatory restrictions on foreign pharmaceutical companies unaffected and also to avoid extortion. Market obstructions to growth continue, as well as an unwieldy approval process for medicines and a long-standing requirement for foreign drug companies to have a manufacturing facility in Indonesia before they can dispense their products. Similar to private insurance companies, consequently, many foreign pharma and medical device companies will have to depend on on Indonesia's growing economy – instead of its healthcare reforms – for any market opportunities.