Are ‘unscrupulous’ insurers causing richer Malaysians to seek public hospitals?

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.