In a significant parliamentary address today, Khoo Poay Tiong, representing Kota Melaka, highlighted the pressing issue of escalating medical insurance premiums, attributing the steep hikes to declining health conditions, an ageing population, and an annual medical cost inflation exceeding 12% in Malaysia while Deputy Minister of Finance, Lim Hui Ying answered the questions given.
Calling for immediate action, Khoo proposed amendments to the Financial Services Act 2013, urging tighter regulation to ensure fairer policy-setting and premium adjustments by Bank Negara. He emphasised the need to protect consumers from sudden premium spikes that could strain policyholders, especially as they age. Additionally, he suggested implementing a No Claim Bonus incentive akin to vehicle insurance, aimed at rewarding policyholders who do not file medical claims.
Furthermore, Khoo advocated for a more active role for Bank Negara in devising a fairer mechanism for determining medical insurance premiums. He underscored the importance of balancing the interests of insurers, private hospitals, and policyholders to foster a mutually beneficial environment.
Addressing concerns over healthcare expenditure, Khoo referenced the substantial RM41.2 billion allocation to the Ministry of Health in Budget 2024. He raised suspicions of middlemen’s involvement in government medical procurement and called for investigations to streamline procurement processes and enhance cost efficiency.
In response, Lim Hui Ying, Deputy Minister of Finance, acknowledged the factors driving premium increases, including medical inflation and consumer behaviour. She highlighted existing initiatives by Malaysian insurers to offer products with incentives like No Claim Bonuses but cautioned against mandating their universal adoption due to potential unintended consequences for healthcare access.
To mitigate sudden premium hikes, Lim Hui Ying announced new regulations requiring insurers to incorporate cost-sharing features in medical insurance products starting in Q3 2024. This measure aims to encourage responsible healthcare utilization and reduce overall financial burdens on policyholders.
Moreover, she outlined Bank Negara’s initiative to establish an integrated claims database for better cost management and transparency. This database will enable insurers to monitor and compare medical costs across providers, enhancing decision-making for consumers.
While acknowledging the proposals, Lim Hui Ying stressed the need for further inter-ministerial discussions to explore comprehensive reforms in collaboration with relevant ministries.
The parliamentary session concluded with a call for concerted efforts to safeguard healthcare affordability and accessibility amidst evolving demographic and economic challenges.
