The Base MHIT plan uses two different deductible levels depending on which tier you choose: RM 500 to RM 1,000 per admission for the Standard Plan, and RM 10,000 to RM 15,000 per admission for the Standard-Plus Plan. Both tiers also include tiered co-payments based on hospital efficiency. Understanding how these numbers work — and what they cost you in practice — is the key to deciding whether this plan makes financial sense for your situation.
What Is a Deductible, and How Does It Work in the Base MHIT Plan?
A deductible is the amount you pay out of pocket at the start of each hospitalisation before your insurer covers the remaining bill. If you are admitted to hospital and your total bill is RM 8,000, and your deductible is RM 500, you pay RM 500 and the insurer pays RM 7,500.
The deductible resets with each new admission — it is not a lifetime or annual figure. This is a critical distinction. If you are hospitalised three times in one year, you pay the deductible three times.
You can read a full explanation of how deductibles work in Malaysian medical insurance on our deductible plans page. The Base MHIT plan applies the same mechanic — it is simply standardised by BNM so every insurer must apply it consistently.
Standard Plan: RM 500 to RM 1,000 Deductible
The Standard Plan is designed to be the accessible, widely-adopted tier. Its deductible range — RM 500 to RM 1,000 per admission — is deliberately set at a level that most working Malaysians can absorb without serious financial strain.
To put this in context:
- RM 500 deductible: equivalent to roughly one month’s grocery bill for a family of four, or two months of petrol for a daily commuter
- RM 1,000 deductible: a manageable one-off cost for most households with even a modest emergency fund
- If your annual premium saving from switching to a deductible plan is RM 1,200 to RM 2,400 per year, the deductible pays for itself in under 12 months without a single claim
A 40-year-old non-smoker on a standard comprehensive plan with no deductible might currently pay RM 300 to RM 600 per month in premiums. Adding a RM 500 deductible to that structure — as many existing deductible products already do — can meaningfully reduce that monthly cost. The Base MHIT plan standardises this trade-off across all insurers.
For most Malaysians who are hospitalised infrequently — the average person is admitted roughly once every few years — the Standard Plan’s deductible is a cost-effective exchange for a lower premium.
Standard-Plus Plan: RM 10,000 to RM 15,000 Deductible
The Standard-Plus Plan is built for a different kind of policyholder: someone who has accumulated savings and can absorb a significant out-of-pocket cost for routine or mid-sized medical events, but wants genuine protection against catastrophic, high-cost hospitalisations.
At RM 10,000 to RM 15,000 per admission, this is not a plan to hold if you do not have liquid savings available. A hospitalisation for appendicitis might cost RM 6,000 to RM 12,000 at a mid-range private hospital — on the Standard-Plus Plan, you could end up covering the entire bill yourself if it falls below your deductible threshold.
Where the Standard-Plus Plan makes sense:
- You have RM 30,000 or more in accessible savings and treat minor hospitalisations as self-insured events
- You want the lowest possible monthly premium and are primarily concerned about a major illness like cancer, cardiac surgery, or a prolonged ICU admission — events that regularly exceed RM 100,000 in total cost
- You are business owners or self-employed individuals who already set aside funds for medical contingencies
The annual limit of RM 100,000 (RM 150,000 for those over 60) applies to both tiers after the deductible is met.
How the Co-Payment Tier Works Alongside the Deductible
The Base MHIT plan layers a co-payment system on top of the deductible. After you have paid your deductible, the insurer covers the remainder of the bill — but your co-payment determines what percentage of that remainder you share.
The co-payment rate is tied to the efficiency rating of the hospital you choose. Hospitals that demonstrate efficient resource use — measured through treatment protocols, length of stay data, and cost benchmarks — attract lower co-pay rates for patients. Hospitals with higher-than-average costs or longer-than-necessary admissions attract higher co-pay rates.
This means your total out-of-pocket cost per admission = deductible + co-payment on the amount above the deductible. The exact co-payment percentages will be published by BNM closer to the plan’s 2027 launch, but the structure is designed to keep total out-of-pocket costs predictable and manageable.
Comparing the Two Tiers: Which One Fits Your Situation?
| Standard Plan | Standard-Plus Plan | |
|---|---|---|
| Deductible per admission | RM 500 – RM 1,000 | RM 10,000 – RM 15,000 |
| Annual limit | RM 100,000 (RM 150,000 over 60) | RM 100,000 (RM 150,000 over 60) |
| Co-payments | Tiered by hospital efficiency | Tiered by hospital efficiency |
| Who it suits | Most Malaysians wanting affordable regular cover | Those with savings, wanting low premiums and catastrophic cover only |
If you are unsure which tier suits your household, the honest answer is: most people with limited savings should start with the Standard Plan. The RM 500 to RM 1,000 deductible is manageable; the RM 10,000 to RM 15,000 deductible is not, unless you have specifically built reserves for it.
What to Do Before the Plan Launches in 2027
You do not need to wait. Deductible-based medical plans already exist in the Malaysian market today, and many of them offer similar cost structures to what the Base MHIT Standard Plan will provide.
Steps to take now:
- Check your current plan’s deductible and co-payment terms — if you already have a deductible plan, compare it against the Base MHIT structure when details are finalised
- Calculate your premium vs deductible trade-off — how much would you save monthly, and how many hospitalisations would it take before the deductible costs you more than the saving?
- Talk to an advisor — the right answer depends on your age, health history, savings, and how frequently your household uses private medical services. Our advisors at FINNO. can walk through this with you at no cost
Frequently Asked Questions
Does the deductible apply every time I am admitted to hospital?
Yes. The deductible in the Base MHIT plan is applied per admission, not annually. Each time you are hospitalised, you pay the deductible before the insurer covers the rest. If you are admitted and discharged within the same event, it counts as one admission.
What if my hospital bill is lower than the deductible?
If your bill is lower than your deductible, you pay the full bill yourself. The insurer pays nothing. This is the core risk of a deductible plan — minor admissions that fall below the threshold are entirely your cost. On the Standard-Plus Plan, this scenario is common for routine procedures.
Can I claim the deductible amount on my income tax?
Medical insurance premiums paid in Malaysia are eligible for personal income tax relief. Whether the deductible portion of a claim qualifies for tax treatment depends on how it is structured — consult a tax advisor for your specific situation.
Will the Base MHIT co-payments apply to day surgery as well as inpatient admissions?
The exact scope of the co-payment and deductible rules — whether they apply to day surgery, outpatient diagnostic procedures, or only inpatient admissions — will be confirmed in BNM’s final product framework ahead of the 2027 launch.
Is a RM 100,000 annual limit enough for serious illness?
For most standard hospitalisations, yes. For cancer treatment, major cardiac surgery, or prolonged critical care, a single treatment episode can easily exceed RM 100,000. If your risk profile includes these scenarios, you may want to explore whether the Base MHIT plan can be supplemented with a top-up product to raise your effective annual limit.
Have a question that wasn’t covered here? Our advisors at FINNO. offer free, no-obligation consultations — no hard sell, just honest answers about what’s right for your situation.