BNM Clarifies Co-Payment Requirements for Medical and Health Insurance and Takaful Products

Eloise Lau

15th July 2024 - 2 min read

Bank Negara Malaysia (BNM) has recently issued a statement to address recent commentaries regarding the implementation of co-payment requirements for medical and health insurance and takaful (MHIT) products. This follows the release of ‘The Policy Document on Medical and Health Insurance/Takaful Business’ earlier this year, which aims to promote more sustainable and affordable MHIT offerings amidst rising medical cost inflation.

Effective September 1, 2024, insurers and takaful operators (ITOs) will be required to offer consumers an option to purchase MHIT products with a co-payment feature. The co-payment option allows consumers to select lower-cost MHIT products tailored to their financial circumstances and needs. Premiums for MHIT products with co-payment features are observed to be 19% to 68% lower than those without co-payment options, depending on the co-payment level.

BNM outlined that ITOs must provide a range of co-payment levels to cater to the diverse financial needs of consumers. To protect policy owners and takaful participants, co-payments are subject to a maximum cap, limiting out-of-pocket expenses for consumers. Additionally, co-payments will not apply in specific circumstances, including emergency treatments, outpatient follow-up treatments for critical illnesses such as cancer or kidney dialysis, and treatments at government healthcare facilities. ITOs are also expected to consider any financial hardships or extenuating circumstances faced by policy owners and may waive co-payments in such cases.

The policy document aims to encourage greater uptake of co-payment MHIT products over time, helping to contain medical cost inflation by managing the over-consumption of health services. This initiative is part of broader healthcare reforms envisioned in the Health White Paper published by the Malaysian Ministry of Health (MOH), which includes enhancing the transparency of medical costs and transforming healthcare delivery.

BNM emphasises that a collective effort is essential to the cause, “As such, a whole-of-nation approach is critical to address medical cost inflation across the healthcare value chain.”

(source: BNM, New Strait Times)

Eloise Lau

As a creative content writer, Eloise has covered finance, business, lifestyle topics, and even moonlights as a singer-songwriter outside of RinggitPlus. Her current interests are learning the best ways to optimise spending and credit card hacks to gain more airline miles.

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