2023 medical cost increase in Asia Pacific is the highest in 10 years
Medical trend in Asia Pacific in 2023
2021: 9.82%, 2022: 6.87%, 2023 (projected): 10.2%
Australia: 8.3%
China: 9.0%
Hong Kong: 8.8%
India: 8.6%
Indonesia: 10.6%
Malaysia: 13.8%
New Zealand: 15.0%
Philippines: 12.6%
Singapore: 9.8%
Taiwan: 7.8%
Thailand: 7.9%
Vietnam 10.0%
Over seven in 10 insurers anticipate higher or significantly higher medical trend over the next three years.
What’s driving the cost increase?
External factors:
- Higher costs due to new medical technologies: 57%
- Profit motives of providers: 53%
- Epidemics and global pandemics (including COVID 19): 32%
- Plan design without any cost-sharing features: 30%
- Limited/Poor networks to effectively control costs: 19%
Insured members/ Providers behaviour:
- Overuse or misuse of care due to medical practicitioners recommending too many services: 79%
- Overuse or misuse of care due to lack of integration between primary, specialty and facility care: 59%
- Insured members’ poor health habits: 53%
- Lack of understanding by insured members of how to use the plan: 39%
- Underuse or lack of preventive services: 26%
Top three conditions in 2023
By cost:
- Cancer
- Circulatory system
- Musculoskeletal and connective tissue
By incidence:
- Cancer
- Digestive
- Respiratory
Mental and behavioural health issues are some of the fastest-growing conditions by incidence of claims in Asia Pacific in the next 18 months.
Managing the medical trend
How typical are the following cost-sharing approaches for the medical products you offer? (% indicate “Very typical” and “Typical”)
- Annual limit on out-of-pocket expenses: 40%
- Member coinsurance: 36%
- Deductible: 35%
- Member copays: 22%
Employers continue to invest in employee wellbeing and access
Biggest change made to medical portfolio in 2022:
- Addition of telehealth services: 57%
- Addition of new wellbeing services: 53%
Asia Pacific lags other regions in applying DEI elements into plans
Exclusions of Diversity, Equity and Inclusion (DEI) elements in Asia Pacific
- Gender reassignment surgery: 90%
- Fertility treatments: 85%
- HIV/AIDS: 65%
- Other mental & behavioural health including but not limited to Autism, ADHD etc.: 63%
- Treatments related to menopause: 52%
- Same sex legal spouse or domestic partner: 46%
Note: Group policies for more than 500 employees
Next steps for employers
- Use claims, demographic analysis and other data, and conduct benchmarking, to ensure benefit offerings reflect desired market positioning.
- Review your vendor strategy through market reviews; ensure you are leveraging local or global purchasing power.
- Identify opportunities to create a resilient workforce by supporting holistic wellbeing, including mental and financial health.
- Take advantage of digital tools and technology, such as telehealth, to help employees access benefits that matter to them.
- Use employee listening to better understand what benefits employees want and need, and build this into a communication strategy.
Source: 2023 Global Medical Trends Survey – Asia Pacific findings
