You could change it, but be aware that many scripts/programmes only know how MD5 or crypt algorithms, so you may have to change them as well.
If everything uses pam for password access, change the specific pam module to another algorithm.
By default pam uses /etc/pam.d/login which uses /etc/pam.d/system-auth
The algorithm can be selected in the system-auth file..
Good Luck!