Strong medicine needed to sustain insurance coverage

Free Malaysia Today

The insurance premium hike has raised widespread complaints, but an in-depth look at the sector shows that the underlying cause is medical inflation, making premium adjustments unavoidable to keep many people covered.  Read More:  https://www.freemalaysiatoday.com/category/nation/2024/12/30/strong-medicine-needed-to-sustain-insurance-coverage/  Free Malaysia Today is an independent, bi-lingual news portal with a focus on Malaysian current affairs.    Subscribe to our channel - http://bit.ly/2Qo08ry   ------------------------------------------------------------------------------------------------------------------------------------------------------ Check us out at https://www.freemalaysiatoday.com Follow FMT on Facebook: https://bit.ly/49JJoo5 Follow FMT on Dailymotion: https://bit.ly/2WGITHM Follow FMT on X: https://bit.ly/48zARSW  Follow FMT on Instagram: https://bit.ly/48Cq76h Follow FMT on TikTok : https://bit.ly/3uKuQFp Follow FMT Berita on TikTok: https://bit.ly/48vpnQG  Follow FMT Telegram - https://bit.ly/42VyzMX Follow FMT LinkedIn - https://bit.ly/42YytEb Follow FMT Lifestyle on Instagram: https://bit.ly/42WrsUj Follow FMT on WhatsApp: https://bit.ly/49GMbxW  ------------------------------------------------------------------------------------------------------------------------------------------------------ Download FMT News App: Google Play – http://bit.ly/2YSuV46 App Store – https://apple.co/2HNH7gZ Huawei AppGallery - https://bit.ly/2D2OpNP  #FMTNews #BankNegaraMalaysia #Medical #Insurance #PremiumHike

Transcript

00:00Malaysians are expected to pay higher medical and health insurance premiums next year,

00:04with increases projected between 40% to 70%.

00:09Why is this happening, and what does it mean for everyone?

00:13Let's start with the All-in-One Medical Card, a handy tool that simplifies hospital

00:17admissions across Malaysia. Just present it at the hospital, and your insurance covers the bills.

00:24Simple, right? But maintaining this system is getting more expensive by the day.

00:30Behind these rising costs are several key factors, but the major contributor? Medical inflation.

00:38Last year, Malaysia saw a 15% rise in medical costs, outpacing the regional average.

00:44Much of this expense comes from hospital supplies and services, including everything from lab tests

00:50to essential medical equipment. These costs, which make up about 70% of patients' medical bills,

00:56are not regulated, meaning hospitals can charge as they see fit.

01:02In addition, insured patients are often charged much higher than self-paid patients,

01:07indirectly pushing up insurance claims and premiums.

01:11This has created a vicious cycle in which high medical insurance claims already outpace

01:16premiums collected, causing insurers to raise premiums. In 2023, the claims-to-premium ratio

01:22exceed at 111%. If this trend continues, insurers might be forced to either drastically raise

01:30premiums or stop offering medical insurance products altogether. So what's being done about

01:36this? On December 20th, Bank Negara Malaysia introduced some interim measures in hopes of

01:42softening the blow. Insurance companies will spread premium increases caused by medical

01:48inflation over three years, capping the annual medical inflation adjustments at less than 10%

01:54for 80% of policyholders. Those aged 60 and above will also have a one-year pause

02:01on premium increases caused by medical inflation from the date of their policy anniversary.

02:07While helpful, these measures do not address the fundamental issue of medical inflation,

02:12which requires more robust, long-term strategies.

02:16Long-term solutions will require all hands on deck. Insurers, hospitals, government bodies,

02:22and even policyholders need to come together to tackle this. Without addressing the root causes,

02:29like unchecked medical costs, this cycle will continue.

02:35Dhanush Rajareza, FMT News.

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