Healthcare benefit costs increasing

Healthcare benefit costs increasing

A new survey by Willis Towers Watson has found that UK healthcare benefit costs are expected to increase by 6.3 per cent in 2019; a slight decrease compared to this year’s rise of 6.9 per cent.

The 2019 Global Medical Trends Survey found that medical insurers globally are projecting that healthcare benefits costs will rise by 7.6 per cent in 2019, a slight increase over 7.1 per cent this year. The smallest increases (five per cent) are projected in Europe, while the largest increases are expected in the Middle East and Africa, where costs are projected to rise by 12.4 per cent. Meanwhile, in the US, the rates at which costs are rising is expected to decline, from 8.7 per cent this year to 7.9 per cent next year.

In addition, the survey found that the outlook for cost increases over the next three years varies significantly by region. For example, only one-third of insurers in the Americas (34 per cent) expect higher or significantly higher medical trend costs over the next three years; however, 60 per cent of Middle East and African insurers and 54 per cent of insurers in Europe anticipate higher costs. Globally, nearly half of insurers (49 per cent) expect cost increases will be higher or significantly higher. 

“Rising healthcare costs continue to be a major issue for insurers and employers globally as increases continue to outstrip inflation by a two-to-one margin and are unsustainable over the long term,” said Cecil Hemingway, Managing Director and Global Co-Head Health and Benefits, Willis Towers Watson. “While some employers are cautiously optimistic that future cost increases will hold steady or increase only slightly, concerns linger over how medical treatment is being provided, the reliance on pharmacy services, and the cost implications of innovative future treatments, all of which can fuel sharp cost increases down the road.”