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PHL employer health care cost growth rising faster than region

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EMPLOYER-PROVIDED health care benefits in the Philippines are expected to grow at an higher rate relative to the Asia-Pacific average next year, Willis Towers Watson said.

In its 2019 Global Medical Trends Survey, the consultancy said health care benefits provided by businesses in the Asia Pacific are expected to grow 7.8%. However, the Philippines, along with China, India, and Malaysia, will post cost growth of more than 10%.

Growth in health care benefit costs in the Philippines is expected to accelerate to 11.5% in 2019 from 10.3% in 2018.

“Insurers blame the high cost of medical technology and the overuse and overprescribing of services as the major cost-driving factors, and caution that soaring hospital/inpatient and pharmacy costs will become significant factors over the next five years,” Willis Towers Watson said in a statement on Thursday.

In the Asia Pacific, 60% of insurers say that high cost of medical technology has been a driving factor in health care benefits costs. On the other hand, 37% cite employers’ profit motive.

It is also reported that eight in ten insurers in the study or 83% also said a big cost-driving factor is “overuse of care due to medical practitioners recommending too many services.” A little over half of insurers or 53% say that employees seek out unnecessary care benefits.

Meanwhile, the cost trend in the Philippines was running higher than even the record inflation of 6.7% in September and October. Medical inflation is “roughly four percentage points higher than CPI.”

Willis Towers Watson Head of Health and Benefits, Philippines Susan La Chica said in a statement on Thursday, “To better control costs, many employers are taking a close look at how they design and deliver health care benefits. There are also fundamental concerns over how medical treatment is being provided and consumed, and the cost implications of innovative future treatments, all of which can fuel sharp cost increases down the road.”

She added that while traditional cost management programs are still choices used by insurers and employers, other innovative methods are also being looked into.

“Insurers and employers are also looking closely at telemedicine, second medical opinion services and other innovative design programs that can help to control costs and meet the needs of their employees to help them make smarter health decisions,” Ms. La Chica said. — Gillian M. Cortez