The cost of healthcare is increasing in Singapore and here's why.
Recently, when the Aon Asia Healthcare Trends Report was released, it was revealed that medical inflation in Singapore is one of the highest in Asia.
The report measured the medical inflation rate of 11 countries in the region through its Aon Medical Inflation Index (AMII) score.
What that calculates is the average medical inflation estimates in 2017 and 2018 and the inflation outlook for the next three years based on a survey of insurers.
Based on the report, Singapore’s medical costs are projected to rise at a faster pace than most of the region.
Singapore’s score was 95.1, higher than seven of the 11 markets surveyed, which includes markets like China, South Korea and the Philippines.
However, there is a decrease in overall medical inflation in Singapore, from 20% in 2014 to 9.6% in 2017.
South Korea had the lowest score of 64.3. Insurers expect medical inflation to increase only marginally in the next three years there, while the regional median score is 82.7, which is what Thailand scored.
Hong Kong scored 78.8, Taiwan 71.4 and Malaysia 132.4, while Vietnam topped the table at 164.5.
So here's why medical inflation in Singapore looks so high. Firstly, hospitalisation costs are high. According to Aon, insurers in Singapore are united in their view that inpatient costs are the principal driver of medical inflation.
It went on to say that medical fees, such as surgery charges, make up the largest component of inpatient costs and are experiencing the highest rate of inflation, according to the report.
Other items that made it to the top five cost components are diagnostic procedures, drugs and medications, prosthetics as well as room and board.
In another report, the 2016 Singapore Life Insurance Association (LIA), it showed that Integrated Shield Plan (IP) insurers in the private healthcare system experienced a claims incidence rate more than double that of the public system, and that the average bill size grew at a faster rate for the IP insurers.
At the outpatient level, diagnostic costs outweighed medical fees. The report said this is a "trend driven by an ageing population and high prevalence of non-communicable diseases such as cardiovascular diseases and cancers".
“There is still plenty to be done to curb medical inflation in Singapore, starting with medical insurers and healthcare providers working together on chronic disease management programmes, and companies encouraging their employees to participate in wellness programmes,” Aon said.
How will you be coping with the rising medical inflation in Singapore? Let us know in the comments.
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