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Asia Pacific Employer-Sponsored Medical Benefit To Increase By 8.2% In 2022

Employers’ medical assistance costs are projected to grow by 8.2% in 2020, beating the regular inflation by 5.8%, states Aon in the 2022 Global Medical Trend Rates Report.

Asia Pacific Employer-Sponsored Medical Benefit To Increase

Employers’ medical assistance costs are projected to grow by 8.2% in 2020, beating the regular inflation by 5.8%, states Aon in the 2022 Global Medical Trend Rates Report.

While medical benefits are said to have recovered from a dip in April 2020, it is likely to surpass the pre-COVID-19 stages during 2022 as the government starts to ease pandemic-related restrictions. To add on, additional inflation and the private sector’s probability of COVID-19 treatment costs are driving the cost higher.

Tim Dwyer, the Head of Health Solutions, Asia Pacific, at Aon, stated the pandemic led to lower utilisation in 2020, due to which plan sponsors had some relief. But the pressures of inflation and high expected future utilisation are immense and have to be managed. Employers must analyse the emerging risks of mental health, the time it would take to normalcy in utilisation patterns, and the possibility of a high COVID-19 cost burden on the private sector. He further commented that employers need to customise their medical plans in the coming two renewal cycles accordingly.

Following is a projection of the increase in medical assistance cost in the APAC region from 2021 to 2022 in alphabetical order:

  • Australia: 2.5% to 3.1%
  • Hong Kong: 5.3% to 5.6%
  • China: 7.0% to 7.0%
  • India: 9% to 13%
  • Japan: 0.0% to 0.0%
  • Indonesia: 13.0% to 12.2%
  • Malaysia: 14.0% to 12.0%
  • Singapore: 7% (2021) to 7% (2022)
  • Philippines: 8.0% to 8.0%
  • South Korea: 7.5% to 8.0%
  • Vietnam: 8.7% to 5.5%
  • Thailand: 6.6% to 11.7%

The projected numbers are determined by an ageing population, general failing health, heightened occurrence of chronic ailments, and poor lifestyle practices. The Aon report stated, “these continue to be global phenomena that are further exacerbated by the potential long-term health impacts of the deferred treatments and routine checks that resulted from the multiple pandemics related lockdowns.”

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