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Press release

Asia’s employer-sponsored medical benefit costs expected to increase 10% in 2022

Insurers in Asia are experiencing above inflation rises in the cost of employer-sponsored medical benefits programs over pre-pandemic levels, according to a report released today by Mercer Marsh Benefits (MMB). According to findings in MMB Health Trends, costs rose by 3.5% in 2020 and by 8.8% in 2021 with insurers expecting medical costs to rise by 10% in 2022 – four times the predicted general inflation rate for the region.

The MMB Health Trends report surveyed 210 insurers globally, including 74 in Asia, and identified key trends influencing the future of employer-provided medical benefits. The results show that five countries in Asia experienced higher medical trend rates than the regional average (8.8%) in 2021, namely India with the highest medical inflation rate of 14%, followed by China (12%), Indonesia (10%), Vietnam (10%), and the Philippines (9%). Overall, 81% of insurers in Asia indicated an upward trend in medical claims activity in 2021, even though 53% of insurers reported lower medical claims than pre-pandemic levels.

The Centers for Disease Control and Prevention has identified non-communicable diseases (NCDs) as the leading cause of mortality globally, accounting for 62% of deaths in Southeast Asia alone. The report reveals that cancer (55%), diseases of the circulatory system (43%) and Covid-19 (36%) were top cost drivers of medical claims in 2021, while respiratory diseases (47%), gastro-intestinal diseases (36%) and Covid-19 (34%) are healthcare conditions that experienced the most frequent claims.

Joan Collar, Asia Regional Leader, Mercer Marsh Benefits, commented: “Costs have soared despite lower levels of medical treatment than before the pandemic, a trend exacerbated by deferred healthcare treatments that for many have resulted in more adverse outcomes, leading to higher costs.”

“Reducing NCDs remains a key priority for employers and insurers, for the health of their employees and their business. More than ever, employer-sponsored medical benefits should be viewed as an as an investment in employees’ wellbeing rather than an expense. Embedding self-care and digital health products into their benefit plans is a useful option for employers and supports employee engagement. Employees who feel their employer cares about their health and well-being are more motivated, productive, committed, and loyal.”

Gaps remain in mental health coverage though inclusive benefits increase

Of all global regions, the report identified Asia as having the most inadequate coverage in relation to mental health with only 34% of insurers providing coverage for outpatient treatments in mental health, and just 21% providing coverage for preventive mental health measures. Moreover, 32% do not offer any coverage for mental health services, reflecting a huge protection gap between access to benefits against the burden of mental health risks.

However, the study shows that 33% of insurers are making changes to facilitate more inclusive medical plan designs by allowing coverage for non-permanent or full-time workforce with 54% either adding or considering extending eligible expenses that are more inclusive for women.

“Employers need to develop a mental health strategy to enhance the overall wellbeing of their employees and refine their benefit strategy accordingly to align it to their diversity, equity, and inclusion goals and the different needs of their employees. With a sharp rise in the number of employees experiencing burnout and fatigue, this has become a workplace imperative. Employers need to deploy investments and resources to ensure they maintain a mentally resilient workforce,” Ms. Collar added.

About Mercer Marsh Benefits

Mercer Marsh Benefits (MMB) was born out of the unification of one of the world’s most respected HR consultancies, the global leader in people risk advisory and the number one disruptive benefits technology firm to form one unique business. Together they have shaped some of the world’s most loved employee benefit experiences for small companies, growing enterprises and global firms. MMB is 7,000 strong, on the ground in 73 countries, and servicing clients in more than 150 countries. It brings local expertise to more places and works side-by-side with clients, and Mercer and Marsh colleagues around the world. Mercer and Marsh are two businesses of Marsh McLennan (NYSE: MMC), together with Guy Carpenter and Oliver Wyman. The Company’s 81,000 colleagues advise clients in more than 130 countries. With annual revenue of almost $20 billion, through its market-leading companies Marsh McLennan helps clients navigate an increasingly dynamic and complex environment.

About Marsh

Marsh is the world’s leading insurance broker and risk advisor. With over 45,000 colleagues operating in 130 countries, Marsh serves commercial and individual clients with data-driven risk solutions and advisory services. Marsh is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people. With annual revenue nearly $20 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer and Oliver Wyman. For more information, visit, follow us on LinkedIn and Twitter or subscribe to BRINK.

Media contacts

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Phyllis Cheng

Vice President, Corporate Communications, Marsh Asia

  • Singapore