Rising Healthcare Cost

Healthcare - defined as the treatment or management of any health problem through the services that may be offered by nursing, medical, dental or any other related service. Healthcare may be curative, preventative or even palliative solutions.

Overview of the Malaysian healthcare sector
Healthcare in Malaysia is mainly under the jurisdiction of the Ministry of Health Malaysia.
Currently, the nation practices a dual healthcare system and has good access to a blend of government and private healthcare services through a network of hospitals and clinics.

Performance Management and Delivery Unit (Pemandu) estimates Malaysia currently spent about 4.7 per cent of its gross domestic product on healthcare with the government paying a significant portion of the country’s total health expenditure.



Public healthcare in Malaysia is heavily subsidised, as the government is determined to maintain medical services at an affordable and accessible level. In contrast, the private healthcare sector, while not subsidised, is thriving predominantly in the urban areas.

Though the public sector provided a full spectrum of medical services, the focus was increasingly shifting towards prevention, disease control and rehabilitative services rather than curative services that some private healthcare provided, its stated.

Going private
Malaysia had a significant number of private hospitals, with an estimated 220 private hospitals were established in 2011. These private healthcares were mainly operated by major groups. The market size of the private healthcare sector in Malaysia is estimated at almost RM8 billion this year, an increase of RM2 billion in 2010. The healthcare industry aspired to generate RM35 billion incremental gross national income contributions and RM50 billion in the year 2020.

This growth is driven by the Malaysian population seeking higher and better quality private healthcare, which has, for example shorter waiting times. The growth contribution was also driven by the ability of Singaporeans to use their health insurance funds at registered hospitals in Malaysia and the comparatively high cost of treatment at private hospitals in Indonesia.

Within the nation itself, she said there was disparity between the private healthcare infrastructure and growth rates. West Malaysia represents 90 per cent of the private hospital market, which is heavily concentrated in Penang at 25 per cent and Klang Valley with an estimated 50 per cent of the private hospital market.

Less than 10 per cent of private hospital beds are in East Malaysia. Thus, there exists the need for more private healthcare players in Sabah and Sarawak.

Outpatient attendances are seeing faster growth than inpatient attendance and as such patients are more willing to pay for faster service, especially in getting a diagnosis and quick consultation. When overall household expenditure was squeezed, there was a tendency to move towards the public health system. Historically, public healthcare systems have been higher in terms of patient growth in times of economic uncertainty as patients delay non-essential or elective procedures, and medical tourism for elective procedures also tended to slow down.

Currently, there are 27 registered medical insurance providers in Malaysia as at March 2012, nine out of which also provide life insurance policies. In 2010, the written premium for general medical insurance was estimated at RM643.5 million or US$200.4 million, and was forecasted to grow to RM1.5 billion or US$490.7 million by 2016.