This article first appeared in The Edge Malaysia Weekly on September 14, 2026 - September 20, 2026

I often reflect on the irony sitting at the heart of Malaysia’s private healthcare story. The very sector now being scrutinised began not as a business, but as an act of charity. I think about this often because the Joint Ministerial Committee on Private Healthcare Costs (JBMKKS) has been working hard on its RESET initiatives to ease the burden on Malaysians in the face of the global escalating cost of healthcare.

As these conversations unfold, I find it important to pull everyone’s attention back to where private healthcare in this country actually started, and to ask what role charity and philanthropy might yet play in our healthcare system today.

Malaysia’s private hospitals did not start off as private enterprises at all. In the 1880s, institutions like Tung Shin Hospital and Lam Wah Ee Hospital opened their doors as charity and mission-based facilities, offering free care to the poor. Others followed in the same spirit: Perak Chinese Maternity Hospital and Fatimah Hospital in Ipoh, Penang Adventist Hospital and Mount Miriam Hospital in Penang, Assunta Hospital in Petaling Jaya, the Kampar Chinese Hospital, Sitiawan Maternity Hospital, and the Chinese Maternity Hospital in Kuala Lumpur. Most ran on donations, some from as far away as overseas.

After Independence in 1957, the public hospital network expanded to meet the nation’s growing needs. By the 1970s and 1980s, private hospitals had begun their own transformation, evolving from charity-based secondary care providers into advanced tertiary centres equipped with the latest technology and specialist expertise.

This shift was propelled partly by the national push towards privatisation under the “Malaysia Incorporated” vision, and partly by genuine market demand as the country matured. With an improving economy and rising household incomes, more Malaysians could afford to seek better choices, comfort and access to cutting-edge healthcare.

Charity-based hospitals understandably slowed in growth, while privately and corporately funded hospitals surged ahead.

Private health insurance grew alongside private hospitals as a result, climbing from just 1% of the population in 1983 to 22% by 2023. Tax incentives for individuals and insurers alike fuelled this expansion, and insurance became a genuine relief valve, helping more Malaysians access private care and easing pressure on public hospitals.

And yet, the numbers tell us this safety net still has large holes. According to the Malaysian National Health Accounts (2011-2024), only 17% of private healthcare financing in 2023 came from insurance payouts. A significant 76% came directly out of pocket from households, and nearly half of that, which is about 46%, went towards private hospital services.

As insurance took centre stage, charitable funding for private healthcare quietly faded into the background. In the 20th century, Kek Lok Si Charitable Hospital in Penang stood out as essentially the only new non-profit private hospital established in Malaysia. The older charity hospitals that remain have largely had to adapt, leaning on insurance payors, self-paying patients and even medical tourists, simply to keep their doors open.

This is where I see genuine cause for hope. Among JBMKKS’ RESET initiatives is one on “Expanding Cost-Effective Options” which is a push to incentivise affordable private healthcare providers, including non-profit hospitals. There is room here to lighten the load carried by both the government and the rakyat.

In 2024, the government reinstated tax exemptions for non-profit hospitals, with four institutions already benefiting from this. Budget 2026 takes this further, opening the door for other private hospitals to establish their own tax-exempt Welfare Funds for underprivileged patients. The guidelines are still being finalised, and I would gently urge that the eventual framework be practical enough to genuinely encourage hospitals to set these funds up, while still holding firm on transparency and accountability. If it is done well, this could become a powerful instrument for expanding access to preventive, acute and chronic care alike.

Once the Welfare Fund mechanism is formalised, I truly believe it could lift our public-private partnership to an entirely new level that serves more Malaysians while relieving an overstretched public system in a meaningful way.

It is also worth noting that private hospitals, I believe, will contribute to this mechanism. As it stands, private hospitals are already quietly doing some of this work. Many currently offer free or subsidised cancer treatment to patients referred from government hospitals, absorbing costs without media coverage or publicity.

Around the world, philanthropic foundations and non-governmental organisations (NGOs) have shown what is possible when public health awareness and access to care are driven by professionally run charitable institutions, supported by tax-exempt giving or social enterprise models.

Our neighbour, Singapore, offers an example close to home. According to the Commissioner of Charities Report 2024, healthcare charities there received a combined S$3.4 billion in income: S$522.7 million came from direct donations, S$2 billion in government grants and a further S$873 million from programme fees, services, merchandise sales, investment income and membership fees.

I also remember, during my years studying in Australia, how cancer prevention posters seemed to be everywhere — on university noticeboards, in shopping malls, along the streets — all put up by the Cancer Council, a national NGO dedicated to cancer control. Its Daffodil Day became such a fixture of national consciousness that yellow daffodils appearing on every street corner needed no explanation. Whenever anyone saw a daffodil, they would think of cancer prevention.

In Hong Kong, the Li Ka Shing Foundation has poured close to HK$10 billion into healthcare projects since 1980. Its more recent “Love Can Help” Medical Assistance Programme alone has delivered HK$203 million in medical assistance to nearly 70,000 people.

These are examples of what well-organised philanthropy can achieve when government and private healthcare systems work alongside each other.

Malaysia stands at a moment where we urgently need to think beyond our usual frameworks. All parties must come together to pool their resources and creativity to address the healthcare challenges ahead, even as we continue raising the bar for quality of care.

I believe the path forward lies in welcoming a fourth partner to the table. Alongside the public sector, private sector and the people, it is time for philanthropy to take its rightful place.

Beyond the tax-exempt Welfare Funds now being introduced by private hospitals, we can actively encourage healthcare societies, NGOs, social enterprises and charitable foundations to deepen their involvement in public health education, disease prevention, health screening, hospital volunteering, community care, post-hospital support and research funding.

The history of Malaysian private healthcare began with charity, and I believe it is only fitting that as we look to build a more sustainable and compassionate system for the future, charity finds its way back to the centre of the story.

Dr Tan Hui Ling is trained as an internal medicine specialist and is currently the managing director of two private hospitals in Penang and Melaka. She is deeply committed to philanthropy and has led numerous initiatives to support terminally ill cancer patients and dementia patients in Malaysia.

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