Kuala lumpur: The government will implement structural reforms to address the issue of rising medical inflation and enhance transparency in the healthcare expenditure system, said Finance Minister II Datuk Seri Amir Hamzah Azizan. He emphasized the introduction of an affordable basic medical and health insurance/takaful (MHIT) product by the end of next year.
According to BERNAMA News Agency, Amir Hamzah explained that this initiative allows time until the end of next year to launch the basic MHIT product, aiming to broaden the current market offerings and ensure a more comprehensive product base. He outlined these plans while wrapping up the debate on the Supply Bill 2026 (Budget 2026) at the policy stage in the Dewan Rakyat.
Amir Hamzah highlighted the formation of a committee co-chaired by the Ministry of Health (MoH) and the Ministry of Finance (MoF) to implement these reforms. The committee involves all stakeholders, including the insurance industry, Bank Negara Malaysia (BNM), the Malaysian Medical Association (MMA), and general practitioners, to ensure a holistic approach.
He stressed the necessity of meaningful structural reforms for controlling future costs through a comprehensive approach involving all parties, ensuring sustainable solutions rather than temporary fixes. Amir Hamzah acknowledged the complexity of rising medical inflation, necessitating cooperation from all stakeholders, including private hospitals and consumers.
Among the key reforms, he mentioned the implementation of a more results-based Diagnosis-Related Groups (DRG) system and Electronic Medical Records (EMR) to improve transparency and manage rising costs. Aligning with the Revamp, Enhance, Strengthen, Expand and Transform (RESET) strategy, efforts are ongoing to develop value-based basic health protection products, anticipated to be available by 2027.
The government plans to expand existing insurance coverage to ensure broader access to healthcare protection. Amir Hamzah stated that the base insurance cover will be released at the end of next year, with further announcements on its financing sources, potentially involving the Employees Provident Fund (EPF).
He explained the importance of long-term reforms in addressing the root causes of medical inflation, such as private hospitals' cost structures, inconsistent clinical practices, and limited transparency in medical charges. Amir Hamzah concluded that the government's primary goal is to ensure the public enjoys quality, sustainable, and affordable healthcare protection.