Malaysia’s healthcare system is grappling with significant funding and cost challenges, according to a recent report by Malaysian Reinsurance Berhad (Malaysian Re). The report highlights underfunding in the public sector as a key issue, with healthcare expenditure standing at approximately 4% of GDP. This figure is notably lower than the 6% to 7% average observed in comparable economies.
In the private sector, the report points to a disconnect between policyholders, insurers, and healthcare providers, leading to concerns over the overconsumption of healthcare services and inflated billing practices. These issues have compounded the challenges facing the sector.
Ahmad Noor Azhari Abdul Manaf, President and CEO of Malaysian Re, emphasized the urgency of introducing new healthcare provision and financing strategies. “There is an urgent need to create a more efficient and sustainable healthcare system in Malaysia,” he said. “The insurance industry plays a crucial role in this transformation and must continue to innovate its products to meet consumer needs while addressing rising healthcare costs.”
The report also identifies several key factors contributing to the rising healthcare costs in the country, including medical inflation, an ageing population, and the increasing prevalence of non-communicable diseases.
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