Led by double-digit increases in the Middle East and Africa, global health care costs are expected to increase in 2014, according to a new survey.
Medical trends, which are projections of increases in the cost of health services, will rise 8.3% globally in 2014, up from 7.9% in 2013, according to the Towers Watson & Co. survey of 173 insurers in 58 countries released Thursday.
The steepest projected increase is in the Middle East and Africa, where costs are projected to rise 10% in 2014, up from 9.8% in 2013, while the Americas — excluding the United States — are not far behind, with costs protected to rise by 9.7% in 2014, up from 9.1% in 2013, and Asia Pacific with a projected cost increase of 9.3% in 2014, compared with 8.8% in 2013.
“Medical trend remains high in many Asia Pacific markets due to factors such as aging demographic — in markets such as Hong Kong, Singapore and South Korea — the rise of noncommunicable diseases and continued cost shifting from public to private systems,” according to the survey.
On the other hand, costs are projected to rise this year by 5.4% in Europe, up from 5.2% in 2013 and the lowest of the four parts of the world that the survey covers.
“Economic troubles in markets such as Greece, Portugal and Spain have impacted medical trend, and employers in those countries have placed significant competitive pressures on insurers to hold down any premium increases on group plans, thereby suppressing the normal medical trend,” the survey said.
In the United States, though, medical costs in 2014 are projected to dip, according to a Buck Consultants L.L.C. survey released earlier this week.