BNM, Govt Looking At Ways To 'Reset' Soaring Medical Inflation

BusinessToday

5 hours ago

The Central Bank and the government stated today that initiatives are being worked out to tackle the painful issues of rising medical cost in the countty.
This was further exacerbated when insurance companies looked to raise premiums which could burden a high portion of the public who rely on private healthcare.
In Malaysia, the steep increase in medical insurance premiums remains a pressing issue. Many individuals have been forced to give up their policies, while others must reassess their coverage to ensure affordability. This rise in premiums stems from multiple factors, including rising healthcare costs, annual medical inflation, overutilisation, increased claims post-pandemic, overcharging by healthcare providers, and fraudulent claims.
Despite Bank Negara Malaysia's (BNM) direction to limit premium increases to 10% for policyholders, some health insurers have not fully complied with the interim cap, which raises concern over rising premiums and charges of private hospitals.
Addressing these challenges and ensuring sustainability requires a collective effort from policyholders, the government, and healthcare providers. How can we ensure that healthcare, a fundamental necessity, remains both affordable and sustainable for all Malaysians?
With heart disease being responsible for 15.1% of deaths in Malaysia it is one that is preventable through lifestyle changes. By adopting a proactive approach through healthier habits and routine screenings, policyholders can help mitigate the costs of insurance premiums by minimising claims. This benefits not only individuals and their families but also strengthens the overall sustainability of the insurance system.
Our government also plays a crucial role in ensuring fair and stable insurance premiums. One effective strategy already in place is promoting preventive healthcare through tax incentives for screenings, vaccinations, and active lifestyle habits. Insurance providers can complement these efforts by collaborating with health organisations and hospitals to incentivise policyholders who maintain healthy habits, such as achieving daily step goals or undergoing regular health screenings.
Furthermore, enforcing medical billing transparency by standardising treatment costs and regulating medical inflation can prevent overcharging and discrepancies. For instance, implementing price controls on essential drugs and treatments can help curb excessive costs. It is also crucial for hospitals to prioritise patient care with quality treatment alongside financial sustainability, fostering long-term trust.
It is also essential to strengthen public healthcare services and resources. Without the needed enhancements, an overflow of patients into public hospitals may overwhelm the system. To ensure that quality healthcare remains accessible to all, balancing the needs of both public and private healthcare systems is crucial.
To achieve a more sustainable insurance system, Malaysia can learn from international best practices. An example would be Singapore's universal healthcare system, which integrates three different components that encourage saving for routine care, insurance for larger expenses and funding from the government to support those in financial need. Related