In a new survey that directly asked 210 insurers in 59 countries to provide their medical trend rate experiences, companies across the MENA region are reporting an inflation-busting surge in the cost of employer-sponsored medical plans.
The underlying reasons relate specifically to the changing nature of today’s employee healthcare needs: a pandemic-induced desire to blend physical and mental wellbeing with a preventative mindset.
The 2022 Mercer Marsh Benefits (MMB) Health Trends report shows that the medical trend rate for the Middle East and Africa has risen to 10.1 percent – up from 9.5 percent in 2021 and 9.6 percent in 2020. The increase is more than in any other region.
Digging deeper, 62 percent of insurers in MENA say that their trend rate is higher now than before the pandemic and trending upwards. This figure is significantly higher than all other world regions. One reason for the disparity is the availability of government-funded support for Covid-19 related inpatient, outpatient, testing and vaccination costs.
Analysis shows that less than a third of European insurers expect to cover Covid-19 treatment because government-funded healthcare is largely available. That ratio is flipped on its head in Asia and the Middle East with 71 percent of insurers expecting to cover outpatient Covid-19 treatments. This important dynamic explains why trend rates are higher in the developing world.
HR professionals and benefits managers in the MENA region will also be familiar with the new realities of mental healthcare provision, which is increasingly recognized as being an essential part of medical insurance coverage.
Mental health and wellbeing
More than any other region, insurers in the Middle East and Africa are incorporating outpatient mental health services as part of their medical plans – 64 percent compared to a global average of 43 percent.
The global numbers also show that a growing proportion of insurers are including preventative mental health measures such as resilience and mindfulness coaching in their coverage – provision of which is inflating trend rates in the region.
‘Emotional or Mental Risks’ are now ranked second in the top-five risk factors ahead of Metabolic and Cardiovascular Risk, Occupational Risk, Infectious Diseases and Dietary Risk – a reality that is reflected in the growing number of claim rates related to emotional and mental healthcare since Covid-19.
Across the MENA region, insurers have consistently identified Covid-19 and emotional or mental risk as top influencers of employer-provided medical plan costs – and two-thirds of insurers expect to cover inpatient Covid-19 care in 2022.
Prevention and self-care
Continued Covid-19 uncertainties look set to define how employer-provided healthcare provision evolves in the near term. To plan effectively, HR professionals and benefits managers should anticipate that to compensate for volatility, renewal premiums will increase. Furthermore, those who are sensitive to unexpected claims patterns will want to monitor utilization more frequently than they did pre-pandemic.
Best practice in the current climate includes updating cost-containment strategies to balance economics with empathy – and to position benefits as a strategically important long-term investment in employee retention and productivity, rather than as an expense.
Where public sector provision exists, employers will also need to leverage a combination of private and public coverages to meet employee needs. They should also brace for the impact of factors like long Covid and deferred care.
And, to gain a more granular understanding of the determinants of employee access, employers should monitor coverage for new Covid-19 variants, prevention strategies and treatment regimes, such as new medications. The development of workplace mental health strategies will also prove beneficial in not only supporting those who are off sick but in enhancing overall wellbeing.
Such measures should form part of a broader preventative strategy of self-care that can help to mitigate health risks and restrain trend rate inflation. Within this approach, employees should be encouraged to continue with preventive care, such as annual health screening, and to ensure they respect local guidelines and restrictions.
And, as technology evolves, embracing of self-care and at-home solutions will improve convenience and access. Employers should also reach out to their insurance providers to see what preventative digital solutions are within their tool kit and what they have in development.
While the course of the Covid-19 pandemic remains unpredictable, it is clear that its impact on employer health programs will persist for years to come. Globally, three-quarters (75 percent) of insurers say that medical claims activity is trending upwards, with two in five (41 percent) reporting claims activity that is higher than pre-pandemic levels.
Close dialogue with insurance brokers can help HR professionals and benefits managers to navigate emerging workforce health challenges, develop benefits strategies and preventative mechanisms that serve the employee, employer, and insurer well into the future.
Christos Adamantiadis, CEO, Marsh Middle East and Africa.
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