Date: 5.11.2026
By: Nicole Leong
What happened
On 4 November 2026, the Joint Ministerial Committee on Private Healthcare Costs (“JBMKKS”) announced the establishment of an independent MediAsas Board. The Board will oversee MediAsas, Malaysia’s new base medical insurance and takaful plan, ahead of its nationwide rollout at the end of January 2027.
The Board is chaired by Professor Emeritus Datuk Dr Norma Mansor. Its members bring experience in public policy, healthcare, insurance and takaful, and hospital operations. Representatives of the Ministry of Health, the Ministry of Finance and Bank Negara Malaysia sit on it ex officio. It is supported by a MediAsas Office operated by ProtectHealth Corporation.
Most commentary has focused on affordability and viability of the programme in addressing healthcare cost inflation in Malaysia. This article looks at a different question: what Malaysia’s healthcare cost reforms mean under competition law, and where hospitals, insurers and takaful operators should draw the line as they work together to deliver them.
Key takeaways
- MediAsas can benefit patients if managed properly. However, the implementation of the program potentially bringing competitors together to discuss how they charge and operate. That is precisely where the Competition Act 2010 applies.
- Government endorsement of a reform does not, by itself, take conduct outside the Competition Act 2010. As the PIAM case shows, a regulator’s involvement must amount to a clear direction backed by statutory power before the legislative-requirement exclusion under Second Schedule of the Competition Act 2010 can apply.
- The 2026 amendments give MyCC compulsory information powers for market reviews.
The competition question at the heart of MediAsas
MediAsas sits within the Government’s RESET strategy on private healthcare costs.
- The JBMKKS and the Association of Private Hospitals Malaysia (APHM) are finalising a standardised framework for hospital bill presentation (see https://www.nst.com.my/news/nation/2026/07/1498709/private-hospital-billing-framework-be-finalised-year-end);
- a standard plan, MediAsas Teras and MediAsas Fleksi, to be sold by competing insurers and takaful operators; and
- ProtectHealth has said MediAsas will introduce Diagnosis Related Group (DRG) pricing framework that will shift hospital reimbursement from itemised fee-for-service billing to fixed whole-case pricing based on diagnosis, procedure and severity (see https://www.thestar.com.my/business/business-news/2026/09/25/mediasas-drg-pricing-framework-built-on-rm48bil-in-hospital-billings)
MediAsas can provide Malaysians with access to more affordable and sustainable medical protection over the longer term if managed properly. However, the implementation of the program potentially bringing competitors together to discuss how they charge and operate. That is precisely where the Competition Act 2010 applies.
Where the line sits: billing transparency versus price-fixing
MyCC has been clear about its approach to fee-setting in healthcare.
In December 2024, according to the Federation of Private Medical Practitioners’ Associations, Malaysia (FPMPAM), MyCC advised it that a fixed regulatory compliance charge for GP clinics contravened section 4 (see: https://www.freemalaysiatoday.com/category/nation/2024/12/16/fixed-regulatory-compliance-charge-rate-against-the-law-private-clinics-told . In May 2025, MyCC publicly warned associations in Sarawak, Penang, and Selangor and Kuala Lumpur against alleged collective price setting (see: https://www.thevibes.com/articles/news/108584/mycc-warns-private-medical-associations-over-price-fixing-practices .
In our view, a common billing framework is valuable in improving transparency if it stays on the form of the bill. It becomes risky the moment it touches the amounts on the bill.
| Topic | Generally lower risk | Higher risk |
| Bill format | Common line-item labels, a standard layout and a patient glossary | Agreeing on the charges and which charges to introduce or bundle |
| Pricing | Each hospital setting and publishing its own rates | Recommended rates or price ranges |
| Data | Aggregated, historic, anonymised figures compiled by an independent party | Sharing current or future prices, discounts or margins |
| Insurer dealings | Bilateral negotiation of panel terms | Common positions on discounts |
Hospitals compete on price, and any collective step that narrows that competition must be assessed under section 4 of the Act. An agreement or concerted practice that fixes prices is deemed to have an anti-competitive object under Section 4(2) of the Competition Act 2010.
Similarly, competing insurers and takaful operators will sell the same MediAsas plans. Coordinating on the standard terms to protect consumers is the focus of the programme. However, coordinating on other rates or features beyond the standard program design may risk infringing the Competition Act 2010.
Government involvement does not automatically take conduct outside the Competition Act 2010
MediAsas is endorsed by Joint Ministerial Committee on Private Healthcare Costs (JBMKKS) as a key initiative designed to provide Malaysians with access to more affordable and sustainable medical protection over the longer term.
It can be tempting to assume that conduct carried out under a government initiative is automatically taken outside the Competition Act 2010. Under the Competition Act 2010, that is not quite right. Under Second Schedule of the Competition Act 2010, conduct to the extent that it is engaged in to comply with a legislative requirement is excluded from the prohibition of anti-competitive agreement under Chapter 1 and abuse of dominance under Chapter 2.
In the case of PERSATUAN INSURANS AM MALAYSIA (PIAM) & ORS v. COMPETITION COMMISSION [2022] 9 CLJ 268 (“PIAM”), it involved a workshop association, its insurer members and a sector regulator, Bank Negara Malaysia (BNM). The arrangement in question concerned parts trade discounts and labour rates for workshops under the PIAM Approved Repairers Scheme. The Competition Appeal Tribunal held that there were two requirements for the exclusion under Second Schedule of the Competition Act 2010 to apply pertaining to an agreement engaged in an order to comply with a legislative requirement. First, an order has been made. Secondly, the order was made to comply with a legislative requirement. The Tribunal accepted that BNM was empowered to direct PIAM and its members. On the facts, however, the Tribunal found BNM’s letter did not state in clear terms that it was directing the insurance companies to enter into the arrangement. The Tribunal held that BNM’s direction in question did not amount to a legislative requirement under section 13(1), read with paragraph (a) of the Second Schedule.
PIAM and its members ultimately succeeded on a different ground. The Tribunal found that the arrangement by PIAM and its members did not infringe section 4(1) and set aside MyCC’s decision, and the Court of Appeal dismissed MyCC’s further challenge in August 2026. The Competition Appeal Tribunal’s decision pertaining to an agreement engaged in an order to comply with a legislative requirement under Second Schedule of the Competition Act 2010 remains applicable.
At present, MediAsas and the common billing framework are policy initiatives rather than legislation. As can be seen from PIAM case, a regulator’s power to direct, or its support of an arrangement, is not enough to take a conduct or arrangement outside the prohibition under the Competition Act 2010. The lesson for MediAsas is to establish the precise legal form and commercial effect of each arrangement before relying on government support. Is there a written direction from a body with statutory power to give it? Does the direction state, in clear terms, what participating enterprises must do? Does the conduct go no further than what is directed?
MyCC’s new toolkit for a market review
Parliament passed the Competition (Amendment) Bill 2026 and the Competition Commission (Amendment) Bill 2026 in July 2026. Together, they are the most significant reform of competition law in Malaysia since 2010. Once in force, several changes bear directly on private healthcare:
- the Act will apply to “any economic activity”, not only “commercial activity”;
- the distinction between horizontal and vertical agreements is removed, which matters for hospital–insurer panel arrangements;
- MyCC may compel information, data and documents in a market review
Practical steps for hospitals, insurers and takaful operators
- Ring-fence association work. Give any billing framework working group a written scope, limited to format and categories. For any association meeting, circulate agendas in advance, open with a competition law compliance statement, keep accurate minutes and have competition counsel attend sessions (if appropriate).
- Use an independent party for data. Where benchmarking is genuinely needed, route the data through an independent adviser, and share only aggregated, historic outputs.
- Seek clear direction from government. Hospitals, insurers, takaful operators and industry associations should engage early with the relevant authorities to clarify the scope of the coordination required for MediAsas.
- Refresh competition law training. Brief commercial teams on compliance with the Competition Act 2010 before the January rollout.
Concluding remarks
MediAsas is an important step towards more affordable private healthcare in Malaysia, and billing transparency is a sensible place to begin. Its success depends on hospitals, insurers and takaful operators working together. Competition law does not stand in the way of that collaboration, but it should be taken into account when considering how the collaboration should be structured.
The PIAM case shows that government involvement alone, without a clear and specific legal direction, will not by itself take an arrangement outside the Competition Act 2010. Under the Competition Act 2010, a finding of infringement by the MyCC can attract financial penalties of up to 10% of worldwide turnover over the period of infringement. It is therefore important for participants to put safeguards in place before the nationwide rollout in January 2027.
How we can help. Wen & Co. advises businesses and regulators on competition law in Malaysia, from structuring industry collaborations to responding to investigations. If you have any question, please reach out to us at general@wenlaw.co
Frequently asked questions (FAQ)
Can private hospitals agree a common billing format under competition law in Malaysia? Generally yes, if it covers only how billing format are presented. However, agreeing on prices, price ranges, recommended prices or which charges to introduce may risk infringing Section 4 of the Competition Act 2010.
Does MediAsas exempt participants from the Competition Act 2010?
No general exemption has been announced. The exclusion under the Second Schedule of the Competition Act 2010 covers conduct required to comply with a legislative requirement.
What new powers does the Malaysia Competition Commission have?
Once the 2026 amendments are in force, MyCC can compel information in market reviews and failure to comply with such a request may itself be an offence.