Not just food: Filipinos hurt from rising medical costs

APART from food and fuel, Filipinos are spending more for medical care than other Asians this year, according to the results of a survey involving 225 insurers across 62 countries.

Based on the results of the survey, titled “2018 Medical Trends Around the World,” Mercer Marsh Benefits projected that the country’s medical inflation rate will average 13.1 percent this year. The figure was based on the cost of private health-care plans.

This would make health care in the Philippines the most expensive in Asia despite its having a young population, with a median age of 23 years old.

“Aside from the obvious threat to the life span and quality of life of its population, the increase in chronic noncommunicable diseases in the Philippines can become a big economic hurdle,” said Maria Theresa E. Alday, CEO, Mercer Philippines Inc. and Health Business Leader, Marsh Philippines Inc.

“The country’s upwardly mobile young population has been one of our country’s key economic drivers. However, if more of them are getting sick, their long-term treatments will be a financial burden both the private and public sectors will have to bear,” Alday added.

She said mental-health concerns are also exerting pressure on medical costs this year.

Alday said, however, that there is no telling the prevalence of mental-health issues in the country since those who suffer from it do not speak up due to the stigma.

In light of this, she recommended that employers take a more proactive and holistic approach to well-being that recognizes mental health “as one of the essential building blocks to help employees fulfill their potential.”

“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,” she said.

Other factors seen driving medical inflation rates are supplier increases (such as availability and access to new medical technologies) and changes to health provider fee guides/schedules.

The rise in employee expectations, changes to public/government social security schemes and/or health reform/legislation may also accelerate medical inflation rate.

“Given how dynamic these factors are, employers need to be smarter about their organizations’ health-care plans, using data and harnessing digital advancements to fine-tune their approach,” said Alday.

The projected medical inflation rate in the Philippines is also higher than the Asian average of 5.6 percent this year and the global average of 9.1 percent.

The report also indicated that the projected average medical inflation rate in Europe is at 7.5 percent; Middle East and Africa, 11.9 percent; and Latin America, 11.5 percent. These figures are also lower than the average for the Philippines.

The country that may see the highest medical inflation this year is Egypt at 20 percent, followed by Brazil at 15.4 percent and countries such as Hungary, Romania, Serbia, and Qatar at 15 percent.

The Philippine data for the survey was obtained from local insurance firms particularly AsianLife and General Assurance Corp., Medicard Philippines Inc., The Insular Life Assurance Co. Ltd. and United Coconut Planters Life Assurance Corporation.

The report asked insurers for information on the rising cost of medical care compared to inflation in each market, as well as the types, costs and frequency of medical conditions that were claimed for by company employees in 2017.

As Mercer’s research parameters for the two reports are different, data from the United States have been excluded from this release. However, according to Mercer’s National Survey of Employer-Sponsored Health Plans 2017, US employers experienced a 2.6-percent increase in the average total health benefit cost per employee in 2017.

Mercer Marsh Benefits is a company that provides clients with a single source for managing the costs, people risks and complexities of employee benefits.

 

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A professional journalist for over a decade, Cai U. Ordinario currently writes macroeconomic and urban development stories for BusinessMirror. She has received awards for excellence in reporting on the macroeconomy and statistics. She was also cited for her contribution to statics reporting by the National Statistical Coordination Board (now the Philippine Statistics Authority). She is a recipient of journalism fellowships including the Jefferson Fellowship from the Honolulu-based East West Center. She is currently completing her Masters degree in Communication at the University of the Philippines. She graduated with a degree of Bachelor of Arts Major in Journalism from the University of Santo Tomas.

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