Singapore health benefit costs set to increase by 10%

SINGAPORE - Media OutReach - 19 September 2019 - Medical costs in Asia Pacific are forecasted to increase from 8.6 percent in 2019 to 8.7 percent in 2020, according to the 2020 Global Medical Trend Rates Report released by Aon plc (NYSE: AON).




In Singapore, employer-provided medical benefit costs will increase by 10 percent in 2020, outpacing average general inflation of 1.4 percent. This is due to a combination of factors such as an ageing population and a rise in chronic diseases including diabetes and high blood pressure.


However, projected medical trend rates vary significantly by location. In Asia, costs are expected to increase the most in Malaysia and Thailand, with average medical trend rates forecasted at 14 percent and 13.9 percent respectively.


In contrast, China and Hong Kong are projected to see an average medical trend rate increase of 7.5 percent and 8.1 percent respectively. Due to the adoption of advanced technology, the prices of medical goods and services are increasing at a level two to three times of general inflation. The penetration of mobile applications for online claims management has also contributed to the increase in claims reported by supplemental medical plans in China. In Hong Kong, the medical trend rate is driven by increasing levels of stress and respiratory infections.


Tim Dwyer, CEO of Health Solutions, Asia Pacific, Aon said, "Cost containment strategies are no longer enough to address medical inflation. Organisations in the region must introduce comprehensive programmes that address the physical, emotional, social and financial wellbeing of their employees. A proactive people strategy focusing on all these factors will lead to a healthier, engaged, and more productive workforce."


Health Care Benefit Cost Growth from 2019 to 2020

 

2019

2020

China

 

6.0%

7.5%

Hong Kong

 

8.3%

8.1%

India

 

9.0%

8.5%

Indonesia

 

13.0%

13.0%

Malaysia

 

16.0%

14.0%

Philippines

 

10.0%

9.2%

Singapore

 

10.0%

10.0%

Thailand

 

9.0%

13.9%

Vietnam

 

12.0%

11.0%




Aon's report confirms the increasing impact of non-communicable diseases on health care costs globally. In Asia Pacific, cardiovascular, cancer, musculoskeletal, ENT and gastrointestinal were the most prevalent health conditions driving health care claims.

Leading Medical Conditions in Asia Pacific and the World

Asia Pacific

Global

1)

Cardiovascular

Cardiovascular

2)

Cancer

Cancer

3)

Musculoskeletal

Diabetes

4)

ENT

High blood pressure

5)

Gastrointestinal

Musculoskeletal



Aon's report also confirms the growing prevalence of risks in Asia Pacific due to high blood pressure, obesity and ageing and unhealthy personal habits such as physical inactivity and bad nutrition.


Leading Health Risk Factors in Asia Pacific and the World

 

Asia Pacific

Global

1)

High blood pressure

High blood pressure

2)

Physical inactivity

Physical inactivity

3)

Bad nutrition

High cholesterol

4)

Obesity

Bad nutrition

5)

Ageing

Poor stress management



"Many of the risk factors lead to chronic conditions with long-term medical costs that make them difficult to treat and result in long-term medical cost increases," said Tim Nimmer, Aon's global chief actuary for Health Solutions. "As a large portion of our waking hours are spent on the job, the workplace is a logical place to create a healthier culture and change behaviours. Our goal is to guide employers as they become more critical in helping individuals and their families to take a more active role in managing their health, including participating in health and well-being activities and better managing chronic conditions."


To view the report, visit https://healthresources.aon.com/reports-2/2020-global-medical-trend-rates-report.


Methodology


The survey was conducted among 105 Aon offices, each one representative of a country, that broker, administer, or otherwise advise on employer-sponsored medical plans in each of the countries covered in this report. The survey responses reflect the medical trend expectations of the Aon professionals based on their interactions with clients and carriers represented in the portfolio of the firm's medical plan business in each country.


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