Double-digit Medical Claims Growth Set To Continue Near Term
KUALA LUMPUR, Aug 27 (Bernama) -- Double-digit medical claims growth is expected to persist in the near term following a 12.28 per cent rise in claims inflation in 2025, driven mainly by more insured individuals seeking treatment at private hospitals.
Total medical claims paid out expanded by 10.7 per cent to RM13.5 billion in 2025, up from RM12.2 billion in 2024, according to a joint statement by the Life Insurance Association of Malaysia (LIAM), Malaysian Takaful Association (MTA), and General Insurance Association of Malaysia (PIAM).
Data from the Malaysia Medical Claims Inflation Report 2025 revealed that of the 12.28 per cent medical claims inflation rate, 11.22 percentage points came from an increase in the number of claims, while the remainder was due to higher care costs.
The report noted that the overall increase in the cost of care was partly moderated by public hospital claims, which accounted for nine per cent of all claims and recorded a14 per cent decrease in claims costs from the previous year. In contrast, private hospital costs rose 5.89 per cent, and claims costs in private day-care settings rose 2.3 per cent.
LIAM chief executive officer Mark O'Dell said the findings are consistent with the World Bank’s analysis of Malaysia’s Medical and Health Insurance/Takaful (MHIT) sector, which identified healthcare utilisation and service intensity as key contributors to rising medical claims costs. He emphasised that addressing the issue requires holistic, cross-sector collaboration among policymakers, healthcare providers, insurers, takaful operators, and consumers to maintain sustainable medical protection.
MTA chief executive officer Mohd Radzuan Mohamed noted that average annual medical claims inflation stood at 13.63 per cent between 2023 and 2025, compared to approximately eight per cent from 2013 to 2018, underscoring the vital need to safeguard fund sustainability for participants.
PIAM chief executive officer Chua Kim Soon added that managing claims growth requires a unified front among stakeholders to enforce transparent practices and efficient care delivery, to address utilisation trends and keep medical coverage sustainable.
The statement noted that the continued adoption of cost-containment measures, stronger action against fraud, waste and abuse, greater cost transparency, Diagnosis Related Group-based billing and the MediAsas plan are expected to help moderate claims growth over time.
The insurance and takaful industry remain committed to working with all stakeholders to build a healthcare ecosystem that is affordable, transparent, efficient and sustainable, while ensuring Malaysians continue to have access to quality medical protection, it noted.
-- BERNAMA