Galen Centre Criticizes Base MHIT Plan for Shifting Costs to Patients Without Tackling Medical Inflation Causes
KUALA LUMPUR, Jan 23, 2026 — The Galen Centre for Health and Social Policy has raised concerns about the government’s base medical and health insurance/takaful (MHIT) plan, warning that it may push healthcare costs back onto patients without addressing the underlying factors driving medical inflation.
Azrul Mohd Khalib, the chief executive of the Galen Centre, pointed out that limited regulation on healthcare pricing, lack of transparency around fees, varying clinical practices, and rising costs of medical supplies and technology have contributed to increasing bills at private hospitals. He explained that these fundamental issues remain unaddressed by the base MHIT plan.
“The current design of the Base MHIT, as outlined in its White Paper, relies heavily on private health insurance and takaful providers and voluntary premium payments by the public,” Azrul said in a statement. “This setup risks giving a false sense of security, increasing inequalities in access to care, and shifting expenses back to patients, especially households already facing higher living costs.”
Azrul stressed that without stronger consumer protections—such as a Private Health Care Commission to oversee insurance premiums and healthcare charges—the plan could normalize higher out-of-pocket payments as a new standard. This outcome would undermine goals of making healthcare affordable. He also suggested that many enrolled in the base MHIT plan might eventually return to public healthcare due to financial strain.
Details of the Base MHIT Plan
The base MHIT plan forms part of the government’s Reset strategy developed by the Ministry of Health, Ministry of Finance, and Bank Negara Malaysia. It includes two options: the Standard Plan and the Standard-Plus Plan.
The Standard Plan offers an annual policy limit of RM100,000 for most and RM150,000 for those over 60 years old, with deductibles of RM500 per disability (increasing to RM1,000 after age 60). For treatment at out-of-network hospitals, patients must share 20 percent of costs, capped at RM3,000 per episode.
The Standard-Plus Plan raises the annual limit to RM300,000 but imposes large deductibles ranging from RM10,000 to RM15,000. While it has lower premiums than the Standard Plan, the high deductibles could deter many from seeking care.
Criticism of Network Design and Costs
Azrul criticized the plan’s tiered network design, which assumes patients can always access suitable care within designated hospitals. He highlighted issues like geography, hospital capacity, waiting times, specialist availability, and readiness, especially in regions outside major urban centers such as the Klang Valley.
“Malaysians should not face higher co-payments simply because the network lacks appropriate facilities nearby or because critical services are unavailable when needed,” he said. This could lead to unequal access, with patients in less-served areas paying more for similar medical needs.
Galen Centre’s quick market review showed that comparable private health insurance plans offer similar or better coverage at lower costs than the base MHIT plan. Azrul said the RM10,000 to RM15,000 deductibles on the Standard-Plus Plan, along with its annual policy limit, make it uncompetitive. Additionally, with no yearly caps on deductibles and co-payments, individuals with repeated health issues could face crippling expenses.
Affordability Concerns for Seniors
The Galen Centre also expressed worry over premiums for older adults. Under the Standard Plan, those aged 61 to 65 may pay RM280 to RM350 monthly, while premiums rise to RM500 to RM780 for those above 75. Azrul recommended that cash subsidies be made available to people over 60 and unemployed individuals seeking assistance through the Social Security Organisation to help cover premiums.
Hospitalization and Coverage Issues
The centre took issue with the government’s plan to classify certain illnesses, like dengue and respiratory infections such as pneumonia, as outpatient cases. They argued that hospitalization remains the standard of care, particularly for high-risk patients, to control and manage potentially severe complications.
“The risk is that Malaysians may buy the plan expecting protection, only to find themselves underinsured during illness episodes, pushing them toward out-of-pocket payments or public hospital queues,” Azrul warned.
Future Outlook
Azrul noted that while the base MHIT plan might appeal to those with existing insurance struggling with premium hikes, it may not attract the uninsured. He referenced a repricing in 2024 and 2025 that led to over 340,000 policy surrenders or terminations, suggesting that reenrolling these policyholders into the base MHIT would be a significant accomplishment.
The Galen Centre’s assessment calls for stronger regulation, better consumer protection, and measures to tackle the root causes of medical inflation to ensure health insurance plans truly serve the public’s needs.
#internationalfinancialnews #latestmarketregulations #globalfinancialupdates #financialnews2025 #internationalmarkettips #financialnews #economicheadlines #interestrateupdates #stockmarketalerts #bankfailurenews #inflationpolicychanges #cryptonewsupdates #centralbankannouncements #taxreformdelays #federalbudgetrequirements #marketsafetynews #investmenttrend2025 #economicforecastalerts #globaleconomicnews #newtradingbans #marketreopeningnews #beststocks2025 #financialinsurancenews #regulationguidelinechanges #bankstrikeupdates #globaleconomicdisruptions #breakingfinancialnews #notedmarketsectors #financialforecast2025 #newinvestmentroutes #globalfinancerules #safestplacestoinvest #financeindustrynews #investmentbanupdates #internationaltaxupdates #financebubblealerts #financialboardupdates #realtimemarketadvisories #policychanges2025 #embassyfinancealerts #latestfinancenews #livingmediterranean #retirementfinanceguide #retirementplanningnews #retirementinvestmenttips #globalretirementtrends #earlyretirementnews #retirementtaxstrategies #bestcountriesforretirement #retirementaccountupdates #retirementbudgeting #retirementfundingalerts #internationalretirementnews
