Webinar on “Indonesia’s Health Sector Reform: Progress, Challenges, and Opportunities”

Tuesday, 4 June 2024 – In this webinar, Professor Laksono Trisnantoro shared some insights into Indonesia’s progress in transforming its healthcare system after the COVID-19 pandemic. He also discussed the effectiveness of the newly implemented Health Law and the challenges it faced in reforming Indonesia’s healthcare system.


ISEAS – Yusof Ishak Institute (ISEAS) invited Professor Laksono Trisnantoro, (Board chairman of the Center for Health Policy and Management, Universitas Gadjah Mada, Indonesia) to share his observations on the provision of the new Health Law and elaborated on the potential effects towards Indonesia’s healthcare system. Dr Siwage Dharma Negara, Senior Fellow, and Co-Coordinator of the Indonesia Studies Programme at ISEAS- Yusof Ishak Institute, moderated this webinar.

Professor Laksono Trisnantoro highlighted the need to implement additional regulations to tackle the current issues faced by Indonesia’s healthcare system. (Credit: ISEAS – Yusof Ishak Institute)

Professor Laksono Trisnantoro began his presentation by first illustrating the healthcare system in Indonesia before the COVID-19 pandemic, stating that the processes were not effective, efficient, and equitable. Indonesia did not experience a comprehensive reform of its healthcare system, despite implementing many laws across history to facilitate changes. These new laws, such as the Medical Practice Law and the Social Security Law, were implemented without much coordination with other aspects of the healthcare system. Other hurdles also prevented its complete reform. Lack of accessibility to medical services, poor distribution of medical specialists and the uneven distribution of the National Healthcare Insurance (BPJS) spending across provinces were some other problems afflicting Indonesia’s healthcare system. As such, a reform in the healthcare sector would require multiple layers of transformation, such as integrating different health policies and addressing immediate objectives like accessibility and quality of medical services. 

Professor Trisnantoro also noticed how the COVID-19 pandemic had indirectly led to a rapid transformation of Indonesia’s healthcare system. After the pandemic, The Ministry of Health created Indonesia’s Health System Transformation 2021 – 2024, which aims to improve primary and secondary care services as well as ensuring the resilience of the health system. The government also enacted the Health Care Law as the legal basis for the health system’s transformation. This law would give the government more authority to formulate policies needed for the effective provision of medical services. In some sense, Professor Trisnantoro believed that enacting this law was an attempt to balance between the government’s control and the medical association’s control of medical services. Returning the power of health sector’s governance back to the government could fasten the implementation and regulation of this new Health Policy Law.

Professor Trisnantoro highlighted the challenges in implementing the Health Policy Law. One of the challenges is to increase human resources across the archipelago, such as medical workers and specialists. Generating more specialists in other provinces had become complex due to conflicting regulations set prior to the enactment of the new law. He cited a case example, stating that the new law would allow doctors to have hospital-based specialist training where they could be trained in a particular skill set, based on the hospital’s needs. However, this would conflict with the Medical Practice Law, where doctor’s specialization had to be approved through the university. As much as this new law could help resolve some manpower issues, executing it would be challenging without solving the conflicting regulations. Similarly, he also pointed out a potential financial constraint, especially when tax to GDP ratio for Indonesia has been declining over the years. Moreover, Professor Trisantoro highlighted that the existing Universal healthcare (UHC) policy has a centralized flow of financing health insurance, which is in contrast with the current decentralized health system model. There is a need to realign the insurance system to be more compatible with the overall health system. Professor Trisnantoro therefore proposed to have more innovative health financing such as private insurance or local government fundings to support healthcare transformation.

The webinar drew an online audience of 78 participants from Singapore and abroad. Some of the topics raised from the Question-and-Answer session included the priority of health reforms under the new administration, the possibility of attracting more foreign investors with the new Health Law and the notion of digital health or telemedicine. Most of the discussion also revolved around the feasibility of having innovative financing, such as incentivization of private health insurance, and improving the current Social Security Agency on Health (BPJS) system.  Professor Trisnantoro acknowledged that it would not be an easy task, especially when access to medical services across Indonesia has been uneven. The intended target audiences for the BPJS (which is the lower and middle-income class) are not receiving the necessary benefits they need. As such, he firmly believed that there is a need to have alternative financing methods which are tiered to different income levels. This will provide people with the flexibility in choosing the type of medical assistance they need, indirectly reducing the financial burden on the government.