Managed Care - May 2008 - (Page 55) MANAGED CARE OUTLOOK Worldview: U.S. health inflation not so bad When it comes to runaway medical costs, the United States isn’t the only country with a problem. In a survey conducted by Watson Wyatt involving 85 insurers to global employers throughout Asia, Africa, Europe, and the Americas, 71 percent of respondents said they expect higher or significantly higher medical costs over the next five years, and 81 percent report that medical costs eclipsed the general rate of inflation in their country. The countries with the highest expected increases are in Asia, Africa, and South America. Pharmacy directors and medical directors will need to adjust plan design and premiums accordingly, says Francis Coleman, senior international consultant at Watson Wyatt. “They can take some of the managed care techniques learned in the United States and adapt them to local countries and cultures.” Premium sharing, like member coinsurance, appears to be the most widely used form of cost-sharing arrangement globally. Global medical costs (% change from previous year) Above median Top quartile 2006 costs minus inflation Asia and Africa Bangladesh China Egypt Hong Kong India The Philippines Russia Saudi Arabia Singapore Europe France Netherlands Switzerland United Kingdom Italy Americas Brazil Canada Chile Mexico United States Venezuela 4.9 10.0 –5.9 7.5 5.4 14.4 3.7 4.5 2.4 3.6 3.7 –2.2 12.3 2.6 6.8 16.7 6.5 –2.8 –2.8 5.3 Compared to current rates, 2007 medical costs 2008 medical costs expectations over the next 5 years (projected) (projected) 13.0 21.2 15.0 8.8 25.0 11.4 13.7 13.3 6.5 13.0 19.6 17.5 9.1 30.0 11.5 15.7 16.3 7.5 Higher Higher Higher Higher Significantly higher About the same Higher Higher About the same 6.6 5.2 7.5 8.0 11.0 7.3 6.0 6.0 8.0 11.3 Higher Higher Higher Higher Higher 5.9 11.5 6.5 12.8 8.0 25.0 7.2 12.0 7.1 12.6 11.0 25.0 About the same Higher About the same Higher Higher About the same Source: Watson Wyatt. Global Medical Trends: 2008 Survey of Medical Insurers MAY 2008 / MANAGED CARE 55
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