The government is weighing a proposal that would enable Employees Provident Fund (EPF) members to use savings from Account 2 to cover monthly health insurance premiums.

According to Health Minister Datuk Seri Dr Dzulkefly Ahmad, this initiative, if adopted, could allow approximately 16 million EPF contributors to access private healthcare services using their own funds. The model is inspired by systems already in place in other countries and is intended to widen health insurance coverage across the population. At present, around 32% of healthcare expenses in Malaysia are borne directly by individuals.

Dzulkefly said that participation in the scheme would be entirely voluntary.

“A small percentage can be used for insurance payment. They won’t even feel it, as it doesn’t come out of their pocket. It’s from the EPF. This is the best way. Eventually, our people will have coverage like in Singapore. But we can’t force it,” he said.

He also emphasised the importance of providing EPF members with choices, noting that some individuals may prefer the broader insurance plans already available in the market.

Earlier, Bank Negara Malaysia urged insurers and takaful providers to revisit their repricing strategies, calling for a more “reasonable implementation” after reports emerged of medical insurance premium increases ranging between 40% and 70% this year.

Insurance and takaful firms have defended the hikes, citing unavoidable pressures stemming from higher claims and ongoing medical inflation.

(Source: NST)

Insider Insights

“The government just shared that 65% of Malaysians will not have enough savings for retirement. Allowing EPF withdrawals to cover health insurance premiums will make the retirement crisis even worse. The government and regulators need to address the root cause of the problem – why is medical cost inflation in Malaysia higher than the global average?” – Siew Yuen Tuck, Group CEO, RinggitPlus

• TAGS:
• Account 2
• Datuk Seri Dr Dzulkefly Ahmad
• Employees Provident Fund
• EPF
• Health Insurance Premiums