Why are medical services getting costlier?

Annual increase in employer medical insurance costs.

Article by:
Kiren Velu Pillai

What Is Malaysia's Inflation Rate And Medical Inflation Rate?

A breakdown of what each data in the charts represent:Inflation Rate: The rate at which the general prices for goods and services rise in a given country. A volatile metric, inflation, can increase and fall rapidly depending on economic conditions and the measures a government chooses to control or counteract.Medical Trends Rate: Provides information on annual increases in medical plan (outpatient and inpatient) unit costs that are anticipated to be technically required to address projected price inflation, technology advances in the medical field, plan utilisation patterns, and cost-shifting from social programs to private insurance.

Source of data Mercer Trends Survey 2017-2022

Why are the factors of high medical inflation?

Here are a few reasons why medical costs are increasing in Malaysia.

  1. Increased utilisation of health services, the overuse of care by insured members continues to be the second most important driver of medical expenses
  2. Unhealthy lifestyle choices, employers indicate that the underuse or lack of preventive services is a significant cost driver. This can be attributed to delayed or avoidance of medical care during the pandemic
  3. Medical advancement, the fusion of technology and medication, has vastly improved healthcare quality. However, this also means that medical costs are higher to fulfil the demand for qualified health professionals and medical instruments

The Centers for Disease Control and Prevention has identified non-communicable diseases (NCDs) such as heart attacks, stroke, and diabetes as the leading cause of mortality globally, accounting for 62% of deaths in Southeast Asia alone.

Here are the leading healthcare conditions that had the most frequent claims in 2021:

It doesn't come as a surprise as Malaysia has the highest prevalence of obesity among adults in Southeast Asia, with 50.1% of our adult population reported to be overweight (30.4%) or obese (19.7%) and has reportedly cost the economy RM 12.88 billion, according to the report from the MOH.

What can corporate do to counter expensive medical inflation?

As an HR responsible for compensation and benefits, you must provide the best care to your employees with the budget allocated to you by your management.

Here are three strategies you can use to reduce cost using HealthMetrics.

Step 1: Set a Budget Limit On The Clinic Visit Amount

This feature allows HRs to control how much an employee is entitled to spend per visit.

Setting a budget limit will enable you to prevent overcharging by clinics and ensure that employees don't take unfair advantage of the benefits you have provided to them.You can also set different budget limits for other benefit pools.

Step 2: Using The Panel Access Policy (Bell-Curve)

The latest addition to HealthMetrics' extensive list of features is the new Panel Access Policy (Bell Curve).

Under the unique Panel Access, GPs are grouped into four different pricing categories (as shown in the image above).The pricing categories update dynamically every month through actual claims data from nationwide transactions of most common employee healthcare claims – such as flu and fever.

As an HR, you can now control access to GP panels based on average prices, control access to GP panels based on average costs, and manage access for all panel types based on specific areas and locations. This allows you as an HR to control access not only based on price but based on-site as well.

Step 3: Take Advantage of Co-Payment

If your costs are high due to your employees' visiting clinics for unnecessary small matters, then taking advantage of the co-payment feature might curb that behaviour.The co-payment enforces employees to pay a small contribution fee each time they visit a clinic. This amount is set by you using one of the two following options:

The co-payment feature will thus encourage your employees to only visit clinics for essential matters. The amount of RM 5 mentioned above may seem small to pay in hindsight, but we have seen a significant impact from it when it comes to reducing cost.


All in all, preparation is vital to ensure your businesses stay afloat during the coming recession wave. We must also realise that digitalisation is inevitable.

We can leverage it to propel businesses to another level in making things efficient, especially as big data can help business owners predict and plan their operations strategically.

Revolutionise your workforce with our platform, designed to create greatness.

Got questions?

We can help with any questions about the HealthMetrics.

Contact us
We got you covered

What is the HealthMetrics platform?

We have created a single, unified platform that enables organizations to enhance employee wellbeing and productivity, regardless of their growth stage. The platform grants access to essential features that improve workplace wellness and optimize healthcare.

Take a closer look at our HealthMetrics Dashboard, or speak to one of our representatives to learn more about HealthMetrics.

Any proof that it works?

48 hours saved in benefit reimbursement.
HealthMetrics’ data-driven approach has been able to accelerate the processing of employee's health benefits significantly.

Read study >

85% reduction in administrative task
Companies can reduce up to 85% of time spent on HR administrative task and this frees up time for HR on more important tasks.

Read study >

May I know about the pricing plans?

Our pricing plans vary in terms of the features and services that are included, so you can select the one that offers the right mix of benefits for your specific requirements. Whether you are a small business owner, a freelancer, or a larger organisation, we have a pricing plan that is tailored to your needs.

You can view the details of each pricing plan on our website, and our customer support team is always available to answer any questions you may have and help you choose the right one for you.

How is the customer support?

We understand that when you are using a platform, you may encounter issues or have questions, and we want to be there to help you resolve them as quickly as possible. That's why we have a team of highly trained and experienced support professionals who are available to assist you anytime.

Reach out to our 24/7 customer support through multiple channels:

Email: corp-support@healthmetrics.com
Hotline: +603-7661 6229
Helpcentre and FAQ: HealthMetrics Help Center