In January 2025, Azrul Mohd Khalib who is the Chief Executive of the Galen Centre for Health and Social Policy, highlighted that an estimated 70% of private hospital charges remain unregulated. This means that hospitals have the liberty to set arbitrary prices for a range of items and services, including essential medical equipment such as wheelchairs, heart monitors, and even emesis basins. Only 30% of hospital bills are regulated, primarily covering specialist fees and medication. This lack of oversight has led to numerous cases where patients unknowingly pay excessive sum of medical bills for items that should otherwise be reasonably priced.
Hidden hospital charges, often labelled as profiteering, are a widespread problem in Malaysia. For example, a simple medical glove that costs RM5 per pair might be billed at RM20. In most cases, this creates an unjust financial burden on patients who pay these inflated charges without question. The issue arises primarily because patients rarely scrutinise their medical bills, either due to a lack of knowledge or because they assume that everything charged is legitimate. As a result, they end up shouldering excessive costs without the ability to challenge these expenses.
One of the most alarming aspects of hidden hospital charges is the suppression of information. Some hospitals use this tactic to increase their revenue without the patient's awareness. A notable NCCC’s case involves Complainant B and Hospital C, where Complainant B’s daughter, a minor under 12 years old, was diagnosed with a cervical cyst. The hospital proceeded with numerous procedures without informing Complainant B that certain treatments were not covered under his company's insurance.
Complainant B, who relied on a Guarantee Letter issued by his company, believed that all medical expenses would be covered. However, despite knowing which procedures were claimable and which were not, the hospital failed to communicate this crucial information. The bulk of the hospital bill was covered by insurance, yet Complainant B was left with an out-of-pocket expense of RM5,000. Following several rounds of negotiation, the hospital agreed to reduce the amount to RM3,500 after a discount. Nevertheless, Complainant B found this sum to be substantial, reinforcing the reality that many patients face when dealing with unexpected hospital charges.
Malaysia's current healthcare system lacks a clear mechanism for patients to challenge such costs, unlike in countries that have implemented price transparency regulations. For instance, the United States of America has introduced the Hospital Price Transparency Rule on 1 January 2021 which makes it a requirement for hospitals to publicly disclose a list of their standard charges for various services. This rule enables patients to compare hospital prices before seeking treatment and allowing them to make informed financial decisions regarding their medical care. Similarly, Singapore is set to introduce the Health Information Bill in mid-2024, which will improve transparency in healthcare pricing and data management. The country also has a robust regulatory system where medical costs in public hospitals are monitored, and pricing is often published online, allowing patients to compare treatment costs across different hospitals.
Australia follows a different but equally effective approach. The Australian government regulates healthcare pricing through the Medicare Benefits Schedule (MBS), which ensures that citizens and permanent residents receive subsidies for hospital services. Private hospitals in Australia are required to provide financial consent before treatment, meaning patients must be informed about the estimated costs and any out-of-pocket expenses they may incur. This allows patients to plan their finances accordingly and prevents hospitals from imposing hidden charges after treatment. Additionally, the Australian Competition and Consumer Commission (ACCC) closely monitors healthcare pricing to prevent exploitative billing practices.
The right to know the cost of medical treatment is a fundamental consumer right that is often overlooked in Malaysia. Patients should be entitled to an itemised bill that details each charge, allowing them to identify any unnecessary or excessive fees. Hospitals should also be required to disclose pricing structures upfront so that patients can make financial decisions with clarity. In instances where patients identify unethical billing practices, they should have a legal avenue to dispute the charges, ensuring that they are not unfairly overcharged.
Many patients are unaware of the steps they can take to protect themselves from hidden charges. One of the most effective ways to safeguard against excessive billing is to demand an itemised bill. By requesting a detailed breakdown of all charges, patients can scrutinise their medical expenses and challenge any discrepancies. Furthermore, patients should not hesitate to dispute unethical fees. If a hospital bill contains unjustified charges, patients should engage with the hospital's billing department to seek clarification. In cases where disputes remain unresolved, patients should report the matter to the Ministry of Health Malaysia or the National Consumer Complaint Centre (NCCC). These organisations play a crucial role in advocating for consumer rights and ensuring that unethical hospital billing practices are addressed.
Insurance also plays a crucial role in managing medical expenses. Patients must have a clear understanding of their insurance coverage, including which procedures and treatments are included and which are not. Many insurance policies require pre-authorisation for specific treatments, making it essential for policyholders to obtain the necessary approvals before undergoing medical procedures. Failure to do so may result in unexpected out-of-pocket expenses, as seen in the case of Complainant B. To avoid such situations, patients should actively communicate with their insurance providers to ensure they are fully aware of the coverage limitations and potential exclusions in their policies.
Key takeaways for understanding insurance include:
- Always review the policy’s terms and conditions to understand claimable and non-claimable expenses.
- Verify whether a Guarantee Letter from the employer or insurer fully covers all medical treatments.
- Ask for a pre-treatment estimate and clarify any potential additional costs before proceeding with medical procedures.
- Ensure that any required pre-authorisations are obtained before undergoing hospital treatments.
To improve transparency and prevent hospitals from imposing unreasonable charges, Malaysia should consider implementing several key reforms. Firstly, the government should introduce regulations that mandate hospitals to disclose their pricing structures publicly. This would allow patients to compare costs across different hospitals and make informed decisions regarding their medical care. For example, legal fees for lawyers are strictly regulated by the Solicitors’ Remuneration Order 2023 whereby the fees for services provided can be calculated and when the fees are subjectively charged to client, the lawyer should be able to justify it based on factors such as:
- The importance of the matter to the client
- The skill, labour, specialized knowledge and responsibility involved
- The complexity if the matter
- The amount or value of property involved
- The time spend
- The number and importance of the documents prepared/ perused
- The place and circumstances under which the services or business or any part thereof are rendered or transacted.
Secondly, an independent regulatory body should be established to oversee private hospital pricing and ensure that all charges are fair and justifiable. This body could also act as a mediator in billing disputes, providing patients with a channel to contest excessive fees. Thirdly, greater public awareness initiatives should be launched to educate consumers on their rights in relation to hospital billing and insurance coverage. Many patients remain unaware of the steps they can take to protect themselves, and an informed public is more likely to challenge unethical practices.
If faced with hidden charges, patients in Malaysia have several avenues for recourse. The first step is to file a complaint with the hospital’s Patient Relations Officer. If the issue remains unresolved, patients can escalate the complaint to the Ministry of Health Malaysia. Additionally, consumer protection groups such as the National Consumer Complaint Centre (NCCC) can assist in addressing cases of overpricing and unethical billing practices. By taking collective action, patients can play a significant role in pushing for greater transparency in the healthcare system.
The issue of hidden hospital charges is a growing concern in Malaysia, affecting countless patients who find themselves burdened with unexpected medical expenses. By looking at international best practices and adopting measures to regulate hospital pricing, Malaysia can move towards a more transparent and fair healthcare system. It is crucial for both the government and consumers to work together in addressing this problem, ensuring that patients receive the medical care they need without being subjected to unjust financial strain. The time for change is now, and concrete steps must be taken to protect the rights and financial well-being of Malaysian patients.
FOMCA’s Push for Oversight and Regulation
In response to these systemic issues, FOMCA (Federation of Malaysian Consumers Associations) has been actively lobbying for the establishment of an independent oversight body to regulate both Managed Healthcare Insurance Third-Party Administrators (MHIT) and private hospitals. This body would play a vital role in ensuring accountability, transparency, and fairness in billing practices, and it would also serve as a mediator in dispute resolutions between consumers, insurance providers, and healthcare institutions.
FOMCA believes that such a regulatory framework is long overdue, particularly given the increasing reports of unethical billing, hidden charges, and the lack of informed financial consent. The absence of regulatory safeguards has allowed both MHITs and private hospitals to act with near-impunity, often leaving patients helpless in contesting exorbitant medical bills.
Written by
Zubli Quzairyl Bin Zubli
NCCC,
Strategic Partners of FOMCA