Asia's medical trend rates projected to hit 13% in 2025: report

Medical trend rates in Asia remained above the global average despite signs of slowdown worldwide, according to the latest Health Trends report from Mercer Marsh Benefits.

The report revealed that the medical trend rates in Asia are projected to remain at 13% in 2025, still higher than the 10.9% forecasted globally.

This is the fourth consecutive year where projected medical trend rates in Asia are above the global forecast. It also comes despite the global predictions slowing down from the 11.4% in 2024.

Across the region, the highest projected medical trend rate is recorded in the Philippines, with 21%, similar to last year's forecast, according to the report.

Following the Philippines is Indonesia, with 19%, followed by Malaysia and Vietnam, which both recorded 15%.

Source: Mercer Marsh Benefits

Cancer as an intensifying risk

According to the report, increased utilisation is the main driver for medical trend rates in 2024, as cited by 81% of respondents in Asia.

This is followed by treatment changes (73%) and medical inflation (73%).

Cancer is also a growing risk in the workforce, with the disease emerging as the top cause of claims based on dollar amount in 2023.

Eight in 10 insurers in Asia also reported that there has been an increase in cancer treatment claims for individuals under 50 over the last five years.

Source: Mercer Marsh Benefits

Addressing surging medical costs

To address the surging costs, 57% of employers in Asia are enhancing their plans instead of reducing coverage, unlike their global counterparts.

In fact, only 43% of employers plan to reduce coverage to manage costs next year, down from 47% in 2024.

Source: Mercer Marsh Benefits

"A well-executed and active plan management strategy can control costs without reducing plan scope," the report read.