Malaysia is set to introduce a Diagnosis-Related Group (DRG) pricing system in 2025 to combat escalating healthcare costs. This move aims to provide fixed-rate payments for specific medical procedures, potentially making healthcare more affordable for citizens.
Malaysia’s private medical healthcare, which has become a significant tourism draw and revenue generator for the country, appears to be increasingly out of reach of many citizens. It came to a point where Prime Minister Datuk Seri Anwar Ibrahim had to weigh in and said that private healthcare costs needed to be regulated as they were “too high and unreasonable”. Bank Negara Malaysia data showed a 12.6 per cent medical cost inflation rate in 2023 — more than double the global average of 5.
6 per cent and an increase from 12 per cent in 2022. And so earlier this month, Health Minister Datuk Seri Dzulkefly Ahmad touted the plans to roll out the Diagnosis-Related Group (DRG) pricing system by the second quarter of 2025.Simply put, the DRG is a pricing system that charges a fixed rate for certain medical procedures. Say you are a patient, the DRG is a way for hospitals to get paid a fixed amount for treating you based on your specific illness or condition. It doesn’t matter how long you stay or how many tests you have — once your condition is identified, the hospital gets a set amount from your insurance or government programme, based on the typical cost for treating that condition.How is it different from the medical billing system now? Currently, private hospitals here use a fee-for-service system (FFS), whereby each service is itemised. This means that as a patient, you are charged separately for each individual service or procedure you receive, like a hospital stay, doctor visits, lab tests, or surgeries. So, if you need more tests or treatments, your bill can keep growing, and the cost depends on what and how much you ge
HEALTHCARE DRG PRICING INFLATION MALAYSIA
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