Malaysia’s healthcare spending to see 7.7% rise in five years: Fitch | Healthcare Asia Magazine
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Malaysia’s healthcare spending to see 7.7% rise in five years: Fitch

Reforms are also eyed to ensure sustainable financing in the long run.

Fitch Solutions forecasted public and private healthcare spending in Malaysia to steadily increase in five years at a compound annual growth rate of 7.7% through 2027 which will support the sector’s modernisation and medical tourism goals.

The bulk of healthcare investments will come from the government as it services the majority of the population. Annual public spending is estimated to rise 8% to RM 43.7b in 2023 from last year, and gradually increase to reach RM 59.5b in 2027 at an 8% CAGR in five years, according to Fitch. 

Expenditures by the private sector, which caters to higher income individuals, expats and tourists, will also steadily increase at a 7.3% CAGR in the same five-year period, rising from the projected RM 33.2b annual spending this year to hit RM 44.4b in 2027.

In total, their combined expenditures are expected to account for 4.4% of Malaysia’s gross domestic product by 2027, up from the 4.1% share recorded last year.

The increased budget for healthcare is in response to the long-standing woes of overcrowding and understaffing in public hospitals, and as a way to modernise and expand public healthcare facilities. 

Fitch said the country’s ageing population and growing chronic disease burden calls for higher public spending, while the private sector helps respond to the growing healthcare demand and bolsters the medical tourism industry.


Malaysia’s issue on ageing population, non-communicable, chronic and emergent issues on top of the need to focus on mental health are focused on by the Health White Paper produced by the country’s Ministry of Health, presented to the parliament in June 2023. 

Fitch noted how the country is also seeking to promote a more sustainable financing for healthcare over the long term.

In a white paper published in June, the Ministry of Health laid out a 15-year healthcare reform plan that, among other things, ensures healthcare financing is sustainable to address key challenges over the long term by implementing a national health insurance scheme. It also proposes a shift of role for the ministry from a service provider to a regulator and policymaker.

Strengthening these efforts, the country will also promote digital health to bolster its medical tourism industry with the help of an electronic medical records system, expected to be rolled out by 2026.

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