The country's health care requirements could increase by 21% this year.
Private Philippine hospitals should cut costs by avoiding wasted spending, including medical supplies, to reduce the burden on patients, as individual health care claims in Southeast Asian countries are likely to grow 21% this year, the highest in Asia.
“We analyzed the actual cost of each program to remove unnecessary expenses and implement a timely inventory system to reduce waste in medical supplies,” Beaver Tamesis, CEO of Asia Hospitals and Medical Center, told Asheralcare Asia.
Private hospitals should also start offering affordable medical packages, such as gallstone removal and pneumonia treatment, rather than just adapting to the wealthy, he said via Zoom.
While health claims costs are expected to stabilize across Asia this year, the Philippines expects health care claims to increase by 21%, the highest in Asia, where the average interest rate is 13%. The Philippines' so-called medical trend rate rose 24% in 2023 and was also estimated at 21% last year.
Vicky Ongchangco, head of Philippine consultant at Mercer Marsh Bestres, said the rise in costs associated with the overall price increase in advanced treatments and health care services is driving this growth.
“For example, 80% of Asian insurers reported an increase in the incidence of cancer treatment claims,” she said in response to questions via email. “The number of utilization also increased, moving to higher cost treatments and medications.”
The lack of health workers is also driving the rise in claims as more Filipino professionals work overseas for better salaries. “The intensification of this situation is due to a significant increase in medical expenses and salaries set by professional healthcare institutions,” Ongchangco said.
“As private hospitals raise prices to cope with the rise in cost of medical claims, employers may face higher health insurance plan premiums as insurers may increase this increase by increasing,” she added.
Tamesis said that the cost of operating the hospital remains high due to sterilization programs, infection control and equipment. “The medical costs will also increase due to import and R&D costs.”
“Medical inflation is always high – that's even twice as high as standard inflation,” he added. Mercer Marsh expects inflation in the Philippines to be 3% this year.
“There is increasing need for more accessible outpatient services,” Tatzis said. “Specialized treatments such as outpatient antibiotic therapy can help prevent unnecessary inpatient admissions.”
Tamesis, an internist and cardiologist, said that a partnership with the Health Maintenance Organization (HMO) to enhance insurance coverage could help solve the problem.
He added that allocating Filipino health insurance companies’ beds ensures that even government-backed insurance can be used in private environments.
Nandy Villar, chief marketing officer of Axa in the Philippines, said the insurance industry is stepping up its financial burden. “We have an important disease product that provides a wide range of protection covering over 150 conditions at different stages,” he said in a response to a question via email.
Public-private partnerships, capacity-building programs and telehealth integration are also expected to reduce stress. “Effective claims processing may also contribute to financial sustainability,” she added.
“The advancements in treatment are great for care, but they tend to be expensive,” Veral said. “These reality is hospitals and insurance companies have to constantly navigate.”
