IS there a fresh attempt to privatise the National Heart Institute (IJN)?

IJN, which had fended off an initial move by Sime Darby to take control of it last year, looks to be facing a renewed bid.

But this time, the threat appears to come from within, with the IJN board of directors allegedly ready to “disembowel” the 17-year-old medical institution.

The board, in a fresh bid to privatise the institution, has allegedly obtained the consent of the Economic Planning Unit (EPU), under the Finance Ministry, to conduct a Widespread Asset Unbundling (WAU) scheme, geared towards separating IJN’s operational functions and further creating new subsidiaries.

The new subsidiaries, it is claimed, would include entities such as IJN Services (a joint-venture company for hospital support services), IJN Assets (to manage and maintain the upkeep of the buildings and equipment) and IJN Pharmacy, which would handle pharmaceuticals.

This, it is alleged, would transform IJN into a full-fledged business entity focused on profits.

In making the claims, blogger Big Dog on his socio-political blog, (bigdogdotcom.wordpress.com) said the exercise would deviate from the original spirit and sole intention of IJN’s inception, which was to provide Malaysians with better and affordable health care.

It was speculated that if the changes take effect, it could eventually pave the way for an initial public offering (IPO) on the stock market, as IJN’s track record of 41,000 successful coronary artery bypass surgeries is exemplary for a private hospital.

Speculation was also rife, should the exercise fail, it would justify cannibalising the group or parts of it to different corporate entities for profit.

The WAU “divide-and-conquer” concept was originally introduced by former Finance Minister 2 Tan Sri Nor Mohamed Yakcop, for the restructuring exercise of Malaysia Airlines (MAS) and the inception of Penerbangan Malaysian Bhd as the special purpose vehicle to undertake the holding and ownership of all MAS assets, especially aircraft.

Nor Mohamed is presently the Minister in the Prime Minister’s Department in charge of the EPU, which had allegedly consented to IJN’s WAU scheme.

At Press time, he could not be contacted for comment.

As a corporate entity, IJN currently operates in the form of IJN Holdings Sdn Bhd, which wholly owns IJN Hospital; IJN Capital, which is a special purpose vehicle (SPV) to issue syariah compliant commercial papers such as Sukuk; IJN College which trains heart care professionals, paid for by IJN Hospital; and IJN International which spearheads its overseas operations.

It is speculated that if the changes take effect, the role of IJN’s physicians, anaesthetists, surgeons, paediatricians and cardiologists would be limited solely to the IJN Hospital, which will be deemed merely an operator within the group.

A raft of personnel reshuffles is also expected to take place. It was alleged that IJN’s present medical director,
Datuk Seri Robaayah Zambahari, was expected to be appointed as IJN Hospital CEO on a one-year contract.
Eminent cardiothoracic surgeon Datuk Azhari Yakub will be the deputy, and assume her position thereafter.
Meanwhile, cardiothoracic surgeon Datuk Rozali Watooth, of the Sime Darby Medical Centre in Subang Jaya, is expected to be appointed chairman of IJN Hospital.

It is alleged that the EPU has already invited the medical director to present the proposed restructuring plan to Prime Minister Datuk Seri Najib Razak on Oct 27.

The plan, however, has met with objection from the Health Ministry.

When contacted yesterday, Deputy Health Minister Datuk Rosnah Rashid Shirlin said although it was still speculative, her ministry would not take kindly to such a move.

“We will not let that happen.

IJN will always have to play a role to serve the public.”

IJN CEO Mohd Radzif Mohd Yunus, in a text message reply to Malay Mail, said the allegations were news to him.

“This is the first time I have heard about IJN being privatised since the Sime Darby bid,” he said.

 

Public outcry led to Sime Darby calling off first bid

IJN first faced a takeover attempt last December, when news broke that Sime Darby Bhd had written to the government, stating its intention to acquire a 51 per cent stake in IJN Holdings Sdn Bhd, which operates the national heart institute.

News of Sime Darby's ambitious plans sparked outrage among the public. Bloggers in particular, campaigned against the move, maintaining that the privatisation of IJN would put the institution's core objective, which was to provide good and affordable health care to Malaysians, at risk.

A post on the intended purchase at Sime Darby Watch simedarbywatch.blogspot.com —a blog started "for employees of the now-defunct Kumpulan Guthrie and Golden Hope to voice their views and concerns" — soon created an avalanche effect and raised public awareness on the implication of the sale.

Malaysian bloggers also created a "bleeding heart" logo and placed it on their blogs to raise awareness and support to "save IJN". A group called "Stop the Sale of IJN" on the popular social networking website, Facebook, also helped the bloggers in their campaign.

Less than a month later, Sime Darby called off its bid, claiming that the decision was made after taking into consideration the "public sentiment and feedback" on the matter.

The group's chief executive officer and president, Ahmad Zubir Murshid, said the company had to respect the "wishes of the rakyat" for IJN to remain in its present structure.