The cost of providing employee medical benefits continues to escalate at double-digit levels around the globe, although the increases are stabilizing in some regions, according to a new survey.

Towers Watson, New York (NYSE, NASDAQ: TW), published this finding in a summary of results from its 2012 Towers Watson Global Medical Trends Survey of 237 medical insurers in 48 countries. This year’s survey represents a nearly 40% increase in participating insurers and a 30% increase in the number of countries since 2010.

The increase in survey participants, the study says, illustrates “how rapidly the private health care industry is expanding worldwide and how popular health care coverage has become as an employee benefit.”

The survey’s authors expect the global cost of employee medical benefits will increase 9.6% this year. This is slightly lower than the 9.8% increase experienced in 2011 and 10.2% increase in 2009, but the survey expects costs to continue to increase at double-digit levels in four of the five global regions this year, with only Europe expecting to see single-digit increases.

 

Global Medical Trends: 2009 – 2012

 

 

 

2009*

 

2010

 

2011

 

2012**

Global

 

10.2%

 

9.6%

 

9.8%

 

9.6%

Asia Pacific

 

9.9%

 

9.6%

 

10.1%

 

10.2%

Europe

 

9.4%

 

9.0%

 

8.5%

 

8.1%

Latin America

 

11.6%

 

10.0%

 

10.4%

 

10.5%

Middle East/Africa

 

10.9%

 

9.8%

 

10.7%

 

10.0%

North America

 

10.8%

 

12.1%

 

11.4%

 

11.0%

*2009 rates are taken from the 2011 Global Medical Trends Survey. **2012 rates are projected.

 

 

 

 

 

 

 

 

 

As cost increases have remained somewhat constant, so have the top cost drivers. The three factors cited most often, which repeat from 2011, are new medical technology causing overuse of care (cited by 52% of survey respondents), practitioners recommending too many services (50%) and providers’ profit motives (31%).

Although the most popular methods of medical cost management remain contracted provider networks and preapproval for inpatient services (both cited by 57% of respondents), less traditional methods are receiving attention, too. More than two in five (42%) of respondents report using chronic condition or disease management tools. And more than one in four (29%) are using wellness programs.

The most common prevention feature remains the second medical opinion, which is offered by nearly 80% of respondents (both in-house and through a partner). Insurers are also increasing wellness services, such as health risk assessments and chronic condition/disease management programs, offering these either in-house or through the use of partners.