Globally, employers’ medical cost increases are expected to escalate over the next five years, according to a recent survey by Watson Wyatt Worldwide. The consulting firm interviewed 85 insurance companies that provide medical insurance to employers in Asia, Africa, Europe, and North and South America.Almost 71% of respondents expect higher or significantly higher medical cost trends in the next five years. And, more than 81% said that medical costs are surpassing the general inflation rate in their country.Rising medical costs have become a global issue, said Francis Coleman, a senior international healthcare benefits consultant with Watson Wyatt. A number of the factors that cause U.S. employers to experience increased healthcare costs—such as an aging population, increased utilization, expensive medical technology—are having similar effects worldwide, he said.Employer medical costs in Canada increased 12.3% in 2006 and a further 11.5% in 2007. Costs are expected to increase another 12.0% this year.Healthcare is quickly becoming the most desired employee benefit around the world—even in countries that support state-sponsored programs, said Ted Nussbaum, North America director of group and healthcare consulting at Watson Wyatt.
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