Rising medical costs and shifting health drivers fuel innovation in employer-sponsored health plans

Medical costs continue to outpace general inflation by close to three times, with a global average 9.7% in 2018 with similar increases for 2019 and 2020, according to the Mercer Marsh Benefits (MMB) 2019 Medical Trends Around the World report, released in June 2019.

A survey of 204 insurers across 59 countries, the report assesses how health conditions, supplier factors and consumer habits are driving costs, noting that, as the cost of health benefit programs continues to rise globally, employers have the opportunity to contain cost through smarter plan design and employee access to quality-focused healthcare.

Globally, the top three health risk factors influencing medical cost remain metabolic and cardiovascular risk, dietary risk and emotional/mental risk:

• Latin America: dietary risk (85%)
• Europe: emotional or mental risks (61%)
• Middle East and Africa: occupational risks (59%), childhood and maternal under-nutrition (24%)
• Asia: environmental risks (52%) – as the effects of high pollution levels in many of the region’s major cities take their toll

In response, the number of insurers investing in initiatives to enable quality-focused care, to better guide members to the right care options for them more quickly, has more than doubled. Globally, 29% now name this type of investment as a top strategic priority.

Insurers are also responding by helping members make smarter healthcare choices with 63% of insurers providing education, tools and incentives to drive positive behavior. The Middle East and Africa had the highest rate of adoption of programs of this type, with 71% of insurers proactively using such consumer-focused tactics with plan members. Globally, 78% are now considering or already support virtual health consultations.

To download a copy the report, click here.