Every nation must answer a deceptively simple question: who pays for health care, and how? The answer shapes everything: who gets treated, who waits, who goes bankrupt, and who dies.
Yet no country has found a perfect solution. Each carries its own genius and its own pathology.
Malaysia now stands at a crossroads. Public health care spending languishes at 2.4 per cent of GDP. Medical inflation has surged past 16 per cent. Only 2.7 million taxpayers fund health care for 33 million people.
The government has rejected mandatory National Health Insurance and Social Health Insurance on political grounds, pursuing instead voluntary products like MediAsas, which excludes pre-existing conditions among its 35 major exclusions.
As the proverb warns, you cannot make bricks without straw. Malaysia is attempting to sustain a comprehensive health care system without a sustainable financing mechanism.
A wise man learns from the experiences of others; a fool learns only from his own. Before charting our own path, we must study the roads others have taken.
The Netherlands: Managed Private Competition/Universal Social Health Insurance
The Dutch health care system blends the Bismarck social insurance model with private market dynamics through a framework of regulated competition.
Citizens purchase mandatory basic coverage from private, non-profit insurers financed through income-linked employer contributions, fixed individual premiums, and mandatory out-of-pocket deductibles.
Insurers are mandated to accept all applicants regardless of age or pre-existing conditions. To maintain equity, a government-managed Risk Equalisation Fund shifts resources to insurers backing higher-risk (older or sicker) populations.
It relies heavily on individual premium payments, supplemented by the state to protect lower socioeconomic groups.
Lessons for Malaysia: Before implementing a hybrid model, Malaysia can learn the importance of robust regulatory oversight to prevent private equity exploitation.
It must also recognise the need for a strong risk-equalisation scheme to keep premiums equitable and prevent insurers from price-gouging or cherry-picking healthy patients.
Finally, it should acknowledge the value of keeping primary care fully subsidised to protect low-income groups from upfront deductible barriers.
Japan: The Bismarck Model At Its Best, And Its Breaking Point
Japan provides universal medical access through its Statutory Social Health Insurance System (SHIS), a decentralised Bismarckian model achieving universal coverage via over 3,000 non-profit insurance funds categorised by employment status and geography.
Citizens must enrol, and the government sets a rigid, uniform national fee schedule for all medical procedures, separating citizens into employment-based or community-based plans.
But Japan’s fiscal foundation is crumbling. Government debt stands at 236 per cent of GDP, constraining the fiscal space available for health investment.
A shrinking workforce and sluggish economic growth undermine the sustainability of the traditional financing model.
Rapidly expanding fiscal strain due to a hyper-ageing population and a shrinking workforce, forcing the government to continuously raise the premium burden on younger generations and increase patient co-payments.
Lessons for Malaysia: A multi-payer insurance model can deliver high-quality care if the government maintains strict control over pricing.
To prevent escalating fragmentation, Malaysia should implement a centralised national fee schedule across both the public and private sectors.
The core takeaway is simple: even the most equitable health care systems cannot outrun the pressures of an aging population and rising debt.
South Korea: The NHI Deficit Crisis
In 2000, South Korea achieved rapid universal health care coverage by consolidating hundreds of fragmented, employer-based insurance funds into a single-payer platform, the National Health Insurance Service (NHIS), which is funded through mandatory payroll contributions and government subsidies.
However, the system is now haemorrhaging funds and will likely enter a deficit by the end of 2026. High copayments for non-essential services maintain a heavy out-of-pocket burden for patients.
To protect profit margins, providers — over 90 per cent of which are private — frequently over-deliver lucrative, non-covered specialised treatments, threatening the programme’s long-term solvency.
Additionally, the lack of a robust primary gatekeeping system prompts patients to crowd tertiary hospitals for minor illnesses, severely straining emergency infrastructure.
From 2016 through 2025, cumulative government support fell KRW 19.45 trillion short of the statutory benchmark. The government has never provided the full statutory proportion.
The initial merger faced fierce political resistance from wealthier corporate funds reluctant to cross-subsidize poorer rural sectors, alongside balancing high patient demand driven by fee-for-service provider incentives.
Lessons for Malaysia: Political will is the foundation. Without it, even the best-designed system collapses. Merging fragmented insurance pools creates immense purchasing power and administrative efficiency.
As Malaysia explores social insurance, it should aim for a unified national pool rather than creating fragmented schemes that induce systemic inequity.
Taiwan: The NHI Reserve Fund Nears The Legal Threshold
Taiwan implements a National Health Insurance (NHI) system, a single-payer system functioning as a government-run, mandatory universal insurance programme funded by payroll taxes, sin taxes (tobacco), and lottery revenues. It operates on an advanced, unified IT backbone utilising electronic health cards.
Taiwan’s NHI covers 99.9 per cent of the population. Yet spending in 2027 is projected to exceed income, resulting in a deficit of NT$81.7 billion (US$2.6 billion). Reserves are forecast to fall to around NT$83.3 billion, barely above the one-month legal threshold.
Premium rates have been adjusted only three times in nearly 30 years, creating a pattern of “excessive intervals and large-magnitude hikes” that destabilises the financial structure.
Implementation Challenges: Politically motivated pressure has kept premium rates chronically low. This has led to frequent financial deficits, which in turn require global budget caps to control spending by health care providers.
Lessons for Malaysia: Political convenience today becomes fiscal crisis tomorrow. Taiwan proves that a digitalised, single-payer system drastically cuts administrative overhead.
Malaysia can emulate Taiwan’s smart-card medical data infrastructure to reduce service duplication and enforce budget caps to prevent runaway medical inflation.
From a policymaking perspective, Taiwan and South Korea are the premier case studies for rapid health system transitions. Both nations transitioned fragmented, heavily private-market networks into single-payer NHI models.
They did not eliminate the private sector. Instead, they decoupled financing from delivery. The government became the single public payer (Beveridge aspect), while hospitals and doctors remained predominantly private and market-driven (Bismarck aspect).
The strategies used by policymakers in Taiwan and South Korea to transition the private insurance sector offer important blueprints.
The United States: The Most Expensive Failure
The US health care system is a fragmented, pluralistic, multi-payer hybrid that does not fit into any single category. It blends private voluntary insurance (mostly provided by employers) with tax-funded public programmes like Medicare for seniors and Medicaid for low-income populations.
The absence of a unified universal system results in high out-of-pocket expenses and uneven access to care. Essentially, the US divides its population into different subsystems, effectively utilising all four major global health care models at once, depending on who you are:
- The Bismarck Model (for working adults).
- The National Health Insurance Model (for seniors and the disabled).
- The Beveridge Model (for veterans and Native Americans).
- The Out-of-Pocket Model (for the uninsured).
Obamacare — officially known as the Affordable Care Act (ACA) — is based on a regulated Bismarck model designed to patch the holes in the existing US health care framework rather than replace it.
The US spends over 17 per cent of GDP on health care – more than any other nation – yet ranks poorly on outcomes. Medical debt now exceeds US$220 billion, and 21 per cent of insured adults carry medical debt, nearly the same share as the 23 per cent of uninsured adults who do.
The expiration of enhanced Affordable Care Act premium tax credits and cuts to Medicaid have left millions uninsured. A proposed $31,000 family deductible highlights the system’s cruelty.
Skyrocketing operational costs, vast health disparities, administrative bloat from thousands of separate insurance companies, and millions of underinsured or uninsured citizens are the challenges they face.
Lessons for Malaysia: The US. serves as a cautionary tale against an unregulated, market-driven system. Malaysia must avoid relying primarily on private commercial insurance for core public health, as it fragments the system, isolates risk pools, and leads to hyper-inflation of medical costs.
The lesson for Malaysia is stark: spending more does not guarantee better outcomes. Fragmentation, weak price regulation, and reliance on out-of-pocket payments create a system that fails the very people it purports to serve.
The author is a senior consultant urologist and urological surgeon at Damansara Specialist Hospital.
This is the personal opinion of the writer or publication and does not necessarily represent the views of CodeBlue.
