MEDICAL insurance costs in Singapore are projected to remain high, with a 12 per cent increase expected in 2025, going by the findings of the WTW Global Medical Trends Survey released on Tuesday (Dec 3).
In the wider Asia-Pacific (Apac), insurers are expecting medical costs to go up by 12.3 per cent next year, up from 11.9 per cent in 2024.
But Audrey Tan, WTW’s head of health and benefits for Singapore and South-east Asia, said the medical inflation rate of the city-state appears to be moving into “a stable trend” in the coming year.
Those surveyed by WTW say the increase in medical costs across the region is expected to continue in the near future. More than three-quarters of insurers in Apac anticipate higher or significantly higher medical trends over the next three years; globally, more than 64 per cent of insurers anticipate this.
In the area of demand for healthcare services, 62 per cent of insurers in Apac expect it to be higher or significantly higher over the next three years.
The top internal factor driving rising costs globally came from medical practitioners recommending too many services, the survey found. This included overprescription of medications and diagnostic practices, which led to unnecessary and excessive costs.
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Other factors included the higher cost of new medical technologies, and prolonged pressure on private healthcare providers due to overwhelmed public healthcare systems.
Half of Apac insurers surveyed last year by WTW said that telehealth had been an effective approach to managing costs, however.
Mental health, pharmacy costs expected to grow in Apac
The survey also noted that mental health and pharmacy costs are expected to rise significantly in Apac.
“High pharmacy costs can be attributed to the ageing population and increase in chronic diseases among the population in Asian markets, such as Singapore,” Tan said.
“This is in tandem with the high cost of new pharmaceuticals and biologics for advanced therapies treatments, the adoption of expensive, branded medication that is perceived as superior to generic medicines, and issues with the supply chain and inflation.”
In Apac, a quarter of insurers expect the costs per person for mental health services to grow over the next three years.
But this figure still trails that among their Western counterparts; 44 per cent of insurers in Europe expect such hikes.
That said, the need for mental healthcare continues to grow, with only 4 per cent of insurers in Apac having removed the exclusion of the condition in their medical portfolios in the last one to two years.
Royston Tan, WTW’s head of health and benefits for Apac, said that mental and behavioural health conditions remain the fastest growing conditions globally, except in Apac.
“In many markets here, it is still a standard exclusion in medical plans and considered a stigma, and employees are not seeking help,” he said.
“Although more insurers in Hong Kong and Singapore have included mental health or removed exclusions of the condition in their medical portfolios, more needs to be done.”
