The 2025 Global Medical Trend Rates report published by Aon in January 2025 forecasts a projected 11.1% rise in the trend rates in the Asia Pacific region. The rise in APAC is second highest globally for 2025 and higher than the global projected increase for 2024 of 9.7%, which represented the highest increase forecasted in 10 years.
Middle East and Africa at 15.5% have the highest trend rate of any region globally. Trend rate figures represent the percentage increase in medical plan costs per employee – both insured and self-insured. Knowing estimated costs in advance can help organisations budget and adjust their benefits philosophy in response, ensuring programmes are sustainable.
This year's report projects APAC will experience the second highest year-over-year trend rate increase after the Middle East and Africa, which has the highest trend rate of any region.
Aon Asia Pacific head of global benefits Alan Oates said, "The biggest rise in medical utilisation and inflation are now behind us in APAC, but recovery in insurer profitability is expected to keep medical trend rates in the double digits for 2025 and 2026."
Mr Oates said, "The high medical trend rate can also be attributed to a higher incidence of cancer and chronic conditions than before the COVID-19 pandemic. Managing the impact of medical inflation therefore should be a top priority for all southeast Asia markets and especially important in New Zealand, Papua New Guinea, Thailand and Vietnam, which are seeing 50% to over 100% increases compared to last year."
The survey revealed that prescription and specialty medications, including weight loss medication, innovations in medical technology, and geopolitical factors, are significantly impacting medical trend rates in APAC and around the world. In addition, support for emotional health as the fastest-growing claim in Aon's APAC client portfolio, wellbeing initiatives designed to mitigate stress, along with other plan enhancements, are also contributing to the double-digit medical trend.
Aon professional services industry practice leader global benefits for Asia Pacific Marina Sukhikh said, "Although most insurers are still raising premiums, we are seeing a slight drop in some markets where risk appetites are returning among insurance providers that were quick to take corrective measures in previous renewal periods. As these insurance providers can now offer competitive pricing terms, we are encouraging clients to test the market as there is increasing value in doing so."
Wellbeing programmes, plan design changes, alternative financing, data and analytics and flexible benefits are among the top strategies employers are expected to undertake in 2025 to affordably promote a healthy workforce.