Overuse of services and care are identified as being the top two factors driving medical costs per person, according to the survey of 307 leading insurers from 77 countries. Seventy percent of insurers worldwide identified an overuse of care due to medical practitioners recommending too many services, while 52 percent of insured members were seen to be overusing available care.

The high cost of new medical technologies is increasing medical costs. Sixty-five percent of insurers thought this was among the three most significant causes, with a further 48 percent identifying profit motive of providers as a main cause. While there is fear about the rising incidence of large-scale claims affecting the insurance industry, only 15 percent identified it as among the three leading causes of higher costs.

Insurers are predicting that pharmacy costs will become an increasingly significant part of medical expenses over the next five years. Sixty-six percent of insurers in the Americas foresee a moderate increase in pharmacy expenses in the next year, while 52 percent of insurers in Asia Pacific agree.

Circulatory, musculoskeletal and cancer are the leading causes of high-cost claims, with 54 percent of respondents worldwide identifying circulatory conditions as the leading cause and 49 percent identifying musculoskeletal conditions as the leading cause — a dramatic rise from preceding years. Cancer was identified by 42 percent of respondents as causing the most claims.

Cancer continues to be the most expensive condition in each of the four regions. The lowest figure was the 68 percent of insurers in the Americas who placed it among the top three conditions and the highest was 82 percent for the Middle East and Africa, in excess of the figures for circulatory conditions, the second placed in the hierarchy. There were 67 percent of insurers in the Asia Pacific region who rated circulatory conditions among the top three most costly conditions, the highest total for non-cancer related illnesses.

While cardiovascular conditions and cancer are generally expected to cause the highest incidence of claims around the world, excluding maternity, the incidence of mental and behavioral disorders are expected to increase over the next five years. In Europe, 44 percent of insurers identified mental disorders as being among the top three conditions in the next five years, with 33 percent of insurers globally agreeing. This perhaps reflects that symptoms are not yet widely recognized by medical professionals and that many insurers do not cover mental disorders.

From a cost perspective, there should be no change in the top conditions — 79 percent of insurers globally expect cancer to be the most costly health condition, with circulatory conditions some way behind on a global average of 59 percent and musculoskeletal conditions further behind on 50 percent.

Europe continues to have the lowest level of gross medical trend increase for private medical insurance, substantially due to the existence of socialized medicine and the integration of treatment with private plans, according to the report.

“While this helps manage costs in some of the largest countries such as France, Spain and the U.K., it is not universal across all of Europe,” the report states. “For some countries, such as Hungary, we continue to see a public health care system under much greater strain, which results in more patients utilizing the private sector.”

For 2019, the projected global, weighted medical trend is 7.6 percent, which continues to outstrip general inflation by a factor of more than 2:1 on a global basis, according to the report. However, this value is just 0.5 percent higher than the reported value for 2018, with no increase at all expected in Europe.

“Despite the relative global stability, it is concerning to see how the trend continues to edge upwards in some of the larger, more significant medical markets such as Brazil, China, India, Mexico and the U.A.E.,” the report states.

The largest increases are expected to be seen in the Middle East and Africa where the regional trend increased from 8.5 percent to 9.9 percent in 2018 and is projected to rise to 12.4 percent in 2019. Other regions show closely guarded optimism, with most predicting either medical trends will stay the same or increase by conservative amounts.

“There are continuing concerns about the manner in which treatment is provided, with fears that it is not being directed on the basis of strict medical need,” the report states. “Respondents also expressed misgivings about reliance on pharmacy services and the cost implications of innovative future treatments.”

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