Hong Kong’s medical costs grew by 9% in 2017 compared to 2016, which was six times the local inflation rate of 1.5% according to Mercer Marsh Benefits’ latest 2018 Medical Trends Around the World survey. While global medical costs increased on average by 9.5% in 2017, almost three times the estimated inflation rate.
The survey spoke to 225 insurers across 62 countries. Hong Kong’s increment was below the average global level but higher than the other two developed Asian cities, namely Singapore (8.6%) and South Korea (7%).
“Hong Kong’s medical costs significantly outpaced the local inflation rate and employer’s cost on health care continues to grow. Therefore, employers should review the existing design of health care plans, further invest in data analytics and adopt a whole system approach in order to effectively manage employee health care cost,” Billy Wong, Mercer’s health & MPF business leader for Hong Kong said in a press release..
“Traditional medical insurance designs are mainly based on receiving crisis treatment in a clinic or hospital setting while seldom involve the principal of encouraging a healthy lifestyle. Adding the preventive elements into the design will help lower the employee health care cost.”
Looking forward, the Medical Trends Around the World survey forecasts global medical costs in 2018 will increase by 9.1% while Hong Kong will see 8.4% growth.
The expectations of today’s workforce for a seamless digital experience, employers and insurers will need to invest in digital and data capabilities with one in six insurers currently providing no digital claim capability today.
“Health insurance is set for significant digital changes that will benefit clients,” said Andrew Perry, managing director of Mercer Marsh Benefits. “The Medical Trends Around the World research validates our thinking that there is a race within the insurer community to collect and use patient data more effectively. If progress is made in this area, it will help companies better address the needs of their employees and achieve the larger goal of a more affordable, quality-focused healthcare system for all.”