Consumers in the Philippines prioritise managing healthcare costs as vital for their financial and mental wellbeing, according to Manulife’s latest research.
The study highlighted healthcare cost management as crucial as Filipinos plan for longer lives and retirements. However, low financial confidence persists amid inflation and rising healthcare expenses.
Manulife’s 2024 Asia Care Survey, which surveyed 1,050 Filipino respondents, introduced the MyFuture Readiness Index. This index measured views on current and future physical, mental, and financial wellbeing.
Filipinos scored 91 for their desired readiness level, above the regional average, but their expected readiness level was only 79, indicating concerns about the future.
The top five challenges impacting confidence in future wellbeing among Filipinos include:
To prepare for their future, including longer life spans, retirement, and unexpected medical needs, Filipinos identified key financial goals:
“The survey reveals a lot of anxiety around economic volatility, healthcare-related expenses, and uncertainty, which dampens the optimism of many Filipinos in achieving high-quality wellbeing in the future,” said Rahul Hora, president and CEO of Manulife Philippines. “But there are ways to address these concerns so they are future-proofed. Significant of these is the value of financial advice and guidance that can help them assess and bring their goals closer to fruition, mitigate risks, and find the right products that provide stronger health and life protection, as well as investment and retirement solutions.”
The survey found that 82% of respondents see rising healthcare costs as a primary threat, with this concern rising to 86% among those aged 50 to 60.
Given that 44.7% of health expenses in the Philippines are out-of-pocket, amounting to $9 billion in 2022, this concern is significant. Manulife projects this figure to reach $13 billion by 2028.
“We see in the Philippines a realisation of longer life expectancy and people rightly want to enjoy good health for a longer time. Healthcare costs trump inflation as their main concern for the future, with women being in general more concerned than men,” Hora said. “To navigate this, there is a need for effective financial planning. It is fair to expect medical costs to rise faster than inflation given aging populations and increased pressure on healthcare services, but our survey suggests that perceptions on the extent of such rises are well above actuality.”
Other Asians are also concerned about healthcare costs, with Manulife’s survey revealing that 39% of Asian consumers prioritise physical wellbeing over financial (32%) and mental (29%) wellbeing.
Over the past 12 months, Filipinos perceived healthcare cost inflation at 32%, the highest in the region and three times the actual rate. Many are concerned about the rising costs of prescriptions (61%), hospitalisation (59%), and preventive healthcare (45%). Notably, elderly care concerns were lower at 16%.
The potential illnesses causing the most concern are heart disease (46%), diabetes (42%), stroke (34%), and cancer (31%). With these health worries and rising medical costs, 78% of respondents agreed that increasing insurance coverage and benefits for inflation is essential for future financial wellbeing.
The findings showed a notable segment using less expensive healthcare (41%) and medicines (53%) to manage costs, typically opting for government health services and generic drugs. Additionally, about three-quarters are exercising more or improving their diet.
In Asia, seven out of 10 survey respondents feel that employer-provided health benefits are insufficient, with 76% of Filipinos expressing this view.
Additionally, 78% of Filipinos believe they need to supplement their employer-provided retirement and pension benefits to secure their financial future, and 58% are considering delaying retirement due to family financial responsibilities.
Traditional views of children as alternatives to insurance and pensions are changing, with 58% of Filipinos disagreeing that children provide support in old age. Only Japan had a higher disagreement rate at 70%. Across Asia, half of those surveyed do not plan to have children, with an average desired number of 1.6. In the Philippines, the average is slightly higher at 1.8.
“We encourage more Filipinos to consider ways to increase their health protection. At the same time, insurers have an important role in helping them do that, including changing perceptions on health costs and focusing on specific individual needs. There’s a need also for greater financial literacy,” Hora said. “Doing that will enable everyone to focus on ways to effectively address the challenges on health protection and long-term savings that exist.”
The fifth annual Manulife Asia Care Survey was conducted in January and February 2024 through online questionnaires in eight markets, surveying 8,400 individuals aged 25 to 60. Participants included 1,052 from mainland China, 1,052 from Hong Kong, 1,063 from Indonesia, 1,000 from Japan, 1,038 from Malaysia, 1,050 from the Philippines, 1,038 from Singapore, and 1,107 from Vietnam. Each respondent either owns insurance or intends to buy insurance.
