KUALA LUMPUR, Aug 5 — Malaysians facing the burden of rising medical insurance premiums will soon have a more affordable option. Beginning in 2027, a voluntary medical insurance and takaful plan called MediAsas will be available, with basic monthly premiums starting from RM65.

Previously known as the Base MHIT Plan, MediAsas is designed for middle-income Malaysians who have been priced out of conventional medical insurance or are looking for a more affordable, streamlined alternative. The programme entered its pilot phase last week for final testing and refinement ahead of its nationwide launch next year.

The road to RESET: Tackling the 15 per cent inflation spike

The introduction of MediAsas comes in response to mounting pressure within Malaysia's healthcare financing system.

According to Bank Negara Malaysia, medical costs in the country rose by 15 per cent in 2024, well above the Asia-Pacific average of 10 per cent. The increase was driven by insurance and takaful claims exceeding the premiums collected by insurers and takaful operators (ITOs).

The sustained rise in medical insurance premiums prompted public concern, leading Bank Negara to introduce interim measures in late 2024. These included staggered premium increases and a temporary freeze on repricing for policyholders aged 60 and above.

In March 2025, the Finance Ministry, Health Ministry and Bank Negara jointly introduced the RESET strategy to address medical inflation. MediAsas is one of the 11 key initiatives under the framework.

Although supported by the government, it is not a social insurance programme. Participation is voluntary, and premiums may be paid using monthly income or through an individual's Employees' Provident Fund (EPF) Account Sejahtera.

Coverage and limits: What RM65 buys you

Eligible Malaysians may enrol in MediAsas at any time before turning 70, with coverage extending until the age of 85.

According to the MHIT White Paper released in early 2026, the basic plan provides an annual coverage limit of RM100,000, increasing automatically to RM150,000 once the policyholder reaches the age of 60.

Based on the average hospitalisation cost of approximately RM9,300 in 2024, the RM100,000 annual limit would be sufficient to cover roughly 10 hospital admissions each year.

The basic plan includes coverage for:

  • Hospitalisation: Room and board, intensive care, and operating theatre fees.
  • Professional fees: Surgical fees, anaesthetist fees, and in-hospital physician visits.
  • Medications and supplies: Hospital supplies and selected high-cost outpatient medications for serious illnesses (such as cancer).
  • Emergency services: Ambulance fees and day surgeries.
  • Acute care: Outpatient treatments for dengue, influenza A and B, bronchitis, and pneumonia.

For individuals seeking greater protection, a Standard Plus option will offer an annual coverage limit of RM300,000 at premiums below prevailing market rates. The enhanced plan is intended for those who already receive employer-sponsored medical benefits but require additional protection against high medical expenses.

The panel hospital factor: Understanding co-payments

MediAsas adopts a two-tier co-payment structure to encourage policyholders to seek treatment at participating healthcare providers.

Private hospitals are divided into panel (in-network) and non-panel (out-of-network) facilities.

  • Panel hospitals: Policyholders pay a RM500 deductible for each disability (illness or accident), with no additional co-payment required.
  • Non-panel hospitals: Policyholders pay the same RM500 deductible plus a 20 per cent co-payment, capped at RM3,000 per disability.

From the age of 61, the deductible for both categories increases to RM1,000, reflecting the higher annual coverage limit available to older policyholders.

Bank Negara said the structure is intended to discourage unnecessary or excessively expensive healthcare utilisation, helping to keep insurance premiums more sustainable over the long term.

The ‘no-look back’ clause and other defining features

Unlike many existing medical insurance products, MediAsas is a standalone protection plan and is not bundled with investment-linked products. This ensures that premiums are used solely for insurance coverage.

Policyholders will also receive access to discounted preventive healthcare services, including health screenings and vaccinations.

One of the plan's most significant consumer safeguards is its “no-look back” clause. Under this provision, insurers are prohibited from reviewing historical medical records to deny claims based on previous health conditions or alleged non-disclosure.

In addition, Bank Negara requires all insurers and takaful operators offering comprehensive medical plans to make MediAsas available as their entry-level product. This allows Malaysians to switch insurers, downgrade coverage during financial hardship, or transition from employer-sponsored medical plans to individual policies without losing continuity of coverage.