Malaysia urged to boost healthcare funding to spare patients pain of costly private treatment

Lack of funding, chronic manpower shortages in government hospitals leave public dependent on private healthcare sector, civil society groups say

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A patient consults a medical specialist at a hospital. Malaysia’s government has set aside 45.3 billion ringgit for healthcare under its 2025 budget. Photo: Shutterstock

Published: 9:10pm, 13 Jan 2025Updated: 2:53pm, 14 Jan 2025

Malaysia’s government must substantially boost funding for public healthcare to avoid driving patients into the arms of costly private treatment, civil society groups have said, as Prime Minister Anwar Ibrahim warned health insurance companies against “unjustified” increases of premiums.

The government has imposed a 10 per cent annual cap on rises in premiums following a public outcry over plans by insurance operators in Malaysia to raise fees by as much as 70 per cent this year.

Insurers say the sharp rise is needed to keep pace with the surging costs of providing private healthcare in an ageing society and as global prices of medical equipment soar.

Malaysia’s Prime Minister Anwar Ibrahim has warned health insurance firms against “unjustified” increases of premiums. Photo: AFP

But Anwar on Saturday admonished the industry for its actions. “If I am not convinced that the increase is reasonable, I will not support or allow it,” he was quoted as saying by national news agency Bernama during the launch of a new private hospital block in his home state of Penang.

Medical cost inflation increase by 12.6 per cent in 2023, more than the double average of 5.6 per cent that year, the Association of Private Hospitals of Malaysia said last month.

While insurance companies are expected to abide by the government’s limit on increasing medical premiums, there remains uncertainty “as to whether medical costs and claims can be contained”, according to Maybank Investment Bank in a client note on Monday.

Marimuthu Nadason, president of the Federation of Malaysian Consumers Associations (Fomca), said that the underlying issue was a lack of funding and chronic shortages of doctors and nurses in government hospitals, which are already struggling with overcapacity.

This has forced the public to rely on insurance policies to cover private healthcare costs, leaving them at the mercy of the high fees charged by insurers and privately run hospitals, Marimuthu said.