Asia Pacific Medical Inflation and Healthcare Trends 2025

This briefing summarizes key findings from WTW's 2025 Global Medical Trends Survey, specifically focusing on the Asia Pacific (APAC) region. The report highlights significant projected medical inflation, primary cost drivers, prevalent health conditions, and areas where APAC insurers lag in benefit provision, particularly concerning diversity, equity, and inclusion (DEI).

I. Main Themes & Key Takeaways

1. Highest Global Medical Inflation: Asia Pacific is projected to experience the highest medical inflation globally in 2025, continuing an upward trend from previous years.
2. Significant Insurer Concern: Over three-quarters of APAC insurers anticipate higher or significantly higher medical trend over the next three years, the highest among all regions.
3. Key Cost Drivers: Both external factors (new medical technologies, public health system decline, plan design) and insured member/provider behavior (overuse/misuse of care, poor health habits) are contributing to the cost increase.
4. Cancer as the Fastest Growing Condition: Cancer (neoplasms) is identified as the fastest growing condition by incidence in Asia Pacific, contrasting with the global trend where mental and behavioral health is number one.
5. Lagging DEI and Inclusive Benefits: Despite some slight improvement, APAC insurers are significantly behind global peers in providing inclusive benefits, particularly regarding gender-affirming care, mental health, same-sex partner coverage, and mammograms.
6. Focus on Wellbeing Programs: A high percentage of APAC insurers intend to add wellbeing services to their health programs, indicating a focus on preventive and holistic health approaches.

II. Most Important Ideas and Facts Asia - Asean - Vietnam

A. Projected Medical Inflation (2025)

• APAC's Dominance: Asia Pacific is projected to have the highest gross medical trend globally in 2025 at 12.3%, up from 11.9% in 2024 and 10.9% in 2023. This compares to a global projected trend of 10.4% for both 2024 and 2025.
• Regional Hotspots (2025 Projected):Indonesia: 19.4%
• Philippines: 18.3%
• Malaysia: 16.4%
• New Zealand: 16.0%
• Thailand: 14.2%
• India: 13.2%
• Singapore: 12.0%
• South Korea: 11.9%
• Vietnam: 11.2%
• Australia: 11.1%
• Taiwan: 11.0%
• China: 10.8%
• Hong Kong: 9.8%
• (Note: Countries marked with '*' have percentages higher than the APAC average.)

B. Drivers of Cost Increase

• External Factors:New medical technologies: "Higher costs due to new medical technologies" (73%) continues to be the top driving factor.
• Public health system decline: "Decline in quality or funding of public health systems" (40%).
• Plan design: "Plan design with little or no cost-sharing" (39%) is the highest among all regions.
• Pharmaceutical advancements: "Higher costs due to advancements in pharmaceuticals (i.e., GLP-1s)" (26%).
• Provider availability: "Too few providers available" (24%).
• Insured Members/Provider Behaviour:Overuse/Misuse of care by practitioners: "Overuse or misuse of care due to medical practitioners recommending too many services" (79%).
• Poor health habits: "Insured members’ poor health habits" (55%).
• Lack of integration: "Overuse or misuse of care due to lack of integration between primary, specialty and facility care" (51%).

C. Fastest Growing Conditions

1. APAC Top 5 (by incidence in last 18 months):Cancer (neoplasms)
2. Respiratory
3. Circulatory system (cardiovascular)
4. Digestive system (gastrointestinal)
5. Musculoskeletal and connective tissue

• Key Distinction: "Cancer is the fastest growing condition in Asia Pacific," and incidences of breast, colorectal, and lung cancer are growing faster in APAC compared to global trends. Notably, "Mental health doesn’t appear on the Asia Pacific list, the only region where this is not a top condition by incidence in the last 18 months."

D. Insurer Actions and Benefit Exclusions (DEI)

• Wellbeing Services: "64% of Asia Pacific insurers said that they intend to add wellbeing services to their health programs — the highest of all regions."
• DEI Lag: APAC shows significantly higher rates of exclusions for DEI-related benefits compared to global averages:
• Gender re-affirming care: 71% of APAC insurers currently exclude it (Global: 62%).
• Other mental and behavioural health (e.g., autism, ADHD): 54% currently exclude it (Global: 45%).
• Mental and behavioural health (e.g., anxiety, depression): 56% currently exclude it (Global: 32%).
• Treatments related to menopause: 34% currently exclude it (Global: 26%).
• Same-sex legal spouse or domestic partner: 36% currently exclude it (Global: 21%).
• Mammograms: 24% currently exclude it (Global: 11%).
• Improvement Note: "There has been a slight improvement since 2024, but Asia Pacific is still behind, especially in mental health, providing benefits for same-sex partners and mammograms."

E. Next Steps for Employers

• Promote preventive care: Encourage screenings, early detection, vaccines, and educational campaigns.
• Ensure benefits are fit for purpose: Review programs to align with population needs, eliminate underutilized coverage, and optimize spend.
• Evaluate vendor solutions: Consider programs targeting chronic conditions (e.g., cancer, cardiovascular) and providing support services/behavioural interventions.

III. Survey Methodology

• Conducted: June to August 2024.
• Participants: 348 leading health insurers representing 75 countries, with input from WTW local brokers representing 55 countries.
• Coverage: Combined data covers 90 countries.