“Minister of Health of the Republic of Indonesia (“MOH”) issued Regulation No. 20 of 2019 on the Implementation of Telemedicine Services among Healthcare Services Facilities and Circular Letter from the Ministry of Health of the Republic of Indonesia Number HK.02.01/MENKES/303/2020 to facilitate people to access the medical services.”
Since the COVID-19 pandemic’s first outbreak, human interaction has changed significantly, as people reduce the frequency of physical interaction to slow down the spread of the virus.
For communication, the demand for the use of technology has rapidly grown while maintaining a physical distance. This also affected other sectors, including healthcare; since the pandemic began, people started getting treatment online through applications, or we can call telemedicine.
World Health Organization (“WHO“) define telemedicine as the use of information and communications technology to deliver health care. Historically, telemedicine supported health services in remote areas to provide medical diagnoses, consultations, and other health services.
Therefore, the Indonesian Government issued the Minister of Health Regulation Number 90 of 2015 concerning the Organization of Telemedicine Services between Health Service Facilities to regulate the telemedicine services.
Registration Certificate and Practice License
The Circular Letter set out the authority of doctors to perform health-tech services, covering;
- Performing physical examinations through audio-visual media;
- Providing advice based on physical and/or supporting review;
- Establishing diagnoses;
- Issuing prescriptions; and
- Issuing reference letters for further physical examination at healthcare.
In providing medical practices, doctors are not allowed from conducting online medical practices directly; thus healthcare services facilities are required to cooperate with third-party health-tech platforms to allow doctors from those facilities to provide online medical practices. Doctors must also ensure they obtain a registration certificate (Surat Tanda Registrasi/STR) and practice license (Surat Izin Praktik/SIP).
Mandatory Having PSE
Referring to Article 12 (2) and (3) MOH 20/2019, the Ministry of Health provides online telemedicine platforms. However, if telemedicine uses the self-developed platform, it should be registered to the Ministry of Health. Moreover, the telemedicine must be completed with an Electronic System Operators/PSE (Penyelenggara Sistem Elektronik).
E-Health businesses are required to be registered as PSE at the Ministry of Communication and Information Technology; technically, there must be standards, guidance, and supervision from health regulators.
Business Fields & Foreign Capital Ownership
A foreigner who wants to establish Telemedicine in Indonesia should check up on the Indonesian Negative List, the foreign ownership restrictions depending on the type of health-tech business model. Companies that provide health-tech platforms acting as an intermediary platform between users and healthcare service providers are likely to be categorized as conducting business activity under KBLI code 63122 – Web Portal or Platform Activities.
For a KBLI code 63122 business to be 100% open to foreign investment requires minimum capital investment at least IDR 100 billion and if the capital investment is below IDR 100 billion the foreign ownership will be restricted to a maximum of 49%.
While for a company which providing health-tech technology solutions and health tech software to client such data processing software or management solutions for hospital or clinic administration, is likely to be categorized as a general software publisher, computer programmer, integrated hardware and software solutions provider or data processor activity are under KBLI code 58200, 62024, 62019, or 63111.
The foreign ownership for the KBLI codes mentioned above are currently open to 100% foreign ownership
Indonesia has immense potential for the development of digital health technology business, considering that Indonesia has a large population. Health technology innovations is expected to facilitate Indonesia’s population for a fairer access to quality health services and medical advice.
Author: Sutria Puti Dwirahayu