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Joseph Sipalan

Malaysians from the highest income group are increasingly turning to public hospitals for treatment as surging private healthcare costs drive up insurance premiums, with lawmakers and industry professionals warning of more pressure on the national healthcare system.
The cost of private healthcare in Malaysia rose by nearly 12 per cent in 2024, well above the global average of about 6 per cent, according to a report on medical trends around the world by professional services firm Aon.
A separate study by the Khazanah Research Institute found that rising medical inflation has led to higher medical insurance premiums in Malaysia, where private medical costs are expected to increase by 12.6 per cent this year, well above the projected global rate of 7.2 per cent.
Health Minister Dzulkefly Ahmad told reporters on Sunday that more patients from T20 households were feeling the pinch.
“If insurance premiums … continue to rise, even the T20 may reconsider [continuing] their policies,” said Dzulkefly, who was referring to the top 20 per cent of households with the highest income in Malaysia.
Last December, Malaysia’s central bank imposed a 10 per cent cap on price increases of medical insurance until the end of 2026 after a public outcry over insurers raising premiums by up to 70 per cent to keep pace with rising private healthcare costs.

Many high-income Malaysians had fallen victim to “unregulated and irresponsible marketing” by insurers offering costly deals without proper coverage guarantees, said Sim Tze Tsin, a lawmaker and a member of the parliament-appointed Public Accounts Committee, which is overseeing the issue of rising health insurance premiums.
Sim said he had received complaints that the duration of some policies would be slashed by up to 40 years after insurers failed to meet projected earnings from their investment plans that were tied to medical insurance and topping up of premium payments.
This is despite policyholders having already signed up to pay annual premiums as high as 5,600 ringgit (US$1,300) for coverage, which is supposed to last until the age of 100.
“When you retire or are close to retiring, they suddenly tell you your insurance can only pay out until you are 60. If you can top up [the policy cost], then they can extend coverage. If not, sorry,” Sim told This Week in Asia.
“We cannot gauge [how many are affected], but it is definitely not isolated and a substantial number of people are affected.”
In 2023, Jennie, a 47-year-old freelance data analyst, sought treatment at a private hospital in Kuala Lumpur for a kidney problem. Her insurance covered the cost of initial treatment, which involved keyhole surgery.
But she needed regular treatment for her malfunctioning kidney, which quickly drained her insurance, and this forced her to choose between costly private treatment, which would run into the thousands of ringgit for each session, or a public hospital.
This is a crisis that will not benefit anyone
Sim Tze Tsin, Malaysian lawmaker
“I chose a public hospital. The doctors there recommended I remove the kidney since my other kidney was still working fine,” said Jennie, who asked to be identified by one name.
“That cost me about 1,000 ringgit. I’m fine now, but imagine how much I would have had to spend to keep a bad kidney working when the private hospital could have just recommended I remove it.”
Sim said Jennie’s situation had become increasingly common and added further strain on a public health system serving millions of Malaysians daily.
While the lawmaker did not think the trend of more well-off Malaysians using public hospitals would overwhelm the healthcare system, he warned that the rush for profits by private hospitals would push costs even higher and deprive people of affordable and timely care.
“This is a crisis that will not benefit anyone. If we don’t sit down together to solve it, everyone will collapse and chase after a shrinking pie,” he said.
Insurance professionals say it is increasingly important for them to protect their clients from “unscrupulous” acts by hospitals or doctors, who would provide treatment with profit maximisation in mind.
Shane Ng, a senior agent with the British insurance firm Prudential, has urged policyholders to periodically review their needs and update their policies for sufficient coverage.
“More education and awareness are needed as many Malaysians still think that if they have a medical plan, it should cover them 100 per cent,” Ng said.


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With private healthcare costs surging, more pressure on the public healthcare system could deprive Malaysians of affordable and timely care


With private healthcare costs surging, more pressure on the public healthcare system could deprive Malaysians of affordable and timely care.


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More well-off Malaysians seek public hospitals as insurance costs surge

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}With private healthcare costs surging, more pressure on the public healthcare system could deprive Malaysians of affordable and timely care

With private healthcare costs surging, more pressure on the public healthcare system could deprive Malaysians of affordable and timely care