THE government is considering amending key legislation, including the Private Healthcare Facilities and Services Act 1998 (Act 586), to support the full implementation of the RESET strategy aimed at tackling the spiralling cost of private healthcare and insurance in Malaysia.
Prime Minister Datuk Seri Anwar Ibrahim, who also serves as Finance Minister, said the Ministry of Health (MOH) is refining the legislative framework to facilitate RESET initiatives, notably the proposed adoption of the Diagnosis-Related Group (DRG) payment mechanism.
“The DRG system will require the sharing of minimum clinical and financial information to improve transparency and strengthen cost controls,” said Anwar in a written reply in Parliament on Wednesday.
“If necessary, the government will consider amendments to other relevant laws under the Health Ministry’s jurisdiction to ensure effective implementation of the RESET strategy.”
RESET — a collaborative initiative between Bank Negara Malaysia, the Finance Ministry, and the MOH — outlines five strategic pillars supported by 11 key programmes, including efforts to restructure medical and health insurance and takaful (MHIT), and ensure stable premium pricing through a basic MHIT product.
The second pillar enhances pricing transparency through the display of drug prices and the publication of standardised service costs, while the third focuses on strengthening the digital health ecosystem via electronic medical records.
The fourth pillar seeks to expand cost-effective care via public-private partnerships and affordable non-profit hospitals, while the fifth targets payment reform by shifting to a DRG-based system to better align costs with quality outcomes.
Anwar noted that RESET’s implementation is overseen by the Joint Ministerial Committee on Private Healthcare Costs (JBMKKS), co-chaired by the Second Finance Minister and the Health Minister, which held its inaugural meeting on 24 June.
The committee includes representatives from private hospitals, insurance providers, medical associations, consumer advocates and academic institutions.
Separately, Health Minister Datuk Seri Dr Dzulkefly Ahmad confirmed that the government will proceed with implementing the Price Control and Anti-Profiteering (Price Marking for Drug) Order 2025 on 1 August, despite a pending judicial review filed by eight medical groups and one private practitioner.
The order, which came into effect on 1 May with a three-month advocacy period, requires all private healthcare providers to display drug prices.
“We are aware of the judicial review application. Nevertheless, the implementation will proceed,” said Dr Dzulkefly during the National Health Technology Assessment Conference 2025.
The legal challenge, filed on 24 July, argues that the regulation is “unreasonable and disproportionate,” alleging it was enacted without adequate consultation, particularly with private general practitioners.
The lawsuit names the Minister of Domestic Trade and Cost of Living, the Health Minister, and the Federal Government as respondents. Case management is set for 22 August at the Kuala Lumpur High Court.
Dr Dzulkefly stated that while the court case proceeds, the ministry will continue to focus on public education and stakeholder advocacy.
“We respect the judicial process. But we also believe in the importance of transparency for consumers. Enforcement will come, but for now, we remain committed to advocacy,” he added. - July 30, 2025
