PETALING JAYA: The upcoming MediAsas insurance scheme is poised to open up fresh growth opportunities for Malaysia’s private healthcare sector, rather than disrupt existing business models.
This was among the key takeaways from RHB Research’s Healthcare Sectorial Series, held in collaboration with Bursa Malaysia, which attracted about 35 institutional clients.
“It (MediAsas) opens an affordable insured segment for private hospitals from January 2027, with diagnosis-related group (DRG) rates anchored on actual private hospital claims. The ramp-up should be gradual; we see limited risk to 2027 earnings,” stated RHB Research in a note.
MediAsas is a standardised, standalone medical and health insurance and takaful baseline plan introduced by the government.
Developed jointly by Bank Negara Malaysia, the Health Ministry (MoH) and the Finance Ministry as part of the national RESET Strategy, it is designed to combat rising medical inflation and make private healthcare more affordable and sustainable.
MediAsas product target the middle-income (M40) segment priced out of conventional plans. Premiums can be paid from Employees Provident Fund’s Akaun Sejahtera, which receives 15% of contributions, which could channel billions of ringgit of new funding into healthcare.
For now, DRG applies only to MediAsas and the rates are derived from about RM5bil of voluntarily submitted private hospital claims, representing about 40% of total claims value. At this stage, the existing fee-for-service book remains unaffected.
Dr Yap Wei Aun, the chief executive officer of the MoH’s Health Transformation Office, expects the industry to feel it, “but not in a shocking way”. ProtectHealth had shared the DRG-based rates with private healthcare operators on Nov 4.
“While the relevant operators have access to the rates, we have yet to see them,” said the research house.
RHB Research added a planned single national base rate should also be relatively favourable to Tier-2 and East Coast hospitals, where reimbursements could be slightly higher than current levels.
“We expect initial volumes to be modest, given the waiting periods and underwriting requirements – making hospital panel uptake over the next two months the key near-term monitorable. While subsequent price reviews could move rates in either direction, we are not building any DRG-related margin impact into our forecasts,” said RHB Research.
DRG rates will be reviewed regularly, and reviews can go either way.
Yap said periodic reviews covering inflation, new technology and operating costs are the MoH’s “commitment”, and acknowledged that input costs could rise with the prolonged Middle East conflict.
However, he expects hospitals to reap most of the efficiency gains under DRG in the first few months or years, and said prices “may change”.
“We read this as the MoH likely recalibrating rates as those gains materialise, so we do not factor any DRG-related margin uplift into our forecasts,” said the research house.
RHB Research noted KPJ Healthcare Bhd
appears “best placed” among its coverage universe, given its sizeable Tier-2 footprint and mid-tier positioning.
“IHH Healthcare Bhd can participate via its Pantai hospital network, but MediAsas is likely to be a modest share of its Malaysian business initially, which does not alter our multi-market thesis.”
