UK health insurance costs are projected to grow by 6.5% in 2016, the largest increase in five years, according to the 2016 Global Medical Trends report by Willis Towers Watson. According to the report, high claim volumes spur the year-on-year increase of health insurance costs in the UK, making them one of the fastest increasing in Europe.
The increase in health insurance costs in the UK is higher than France (3.5%) and Spain (1.2%). However, Nordic countries such as Norway (10%) and Sweden (8%) surpass the UK’s, with Russia topping Europe for the second year in a row with 15%.
The global average health insurance price increase for 2016 is at around 9.1%, up from 8% in 2015 and 7.5% in 2014. European cost increases are lower compared to other global regions, such as the Middle East and Africa, where health insurance inflation rose from 10.3% in 2014 to 12.6% in 2015.
The report reveals that UK cost hikes are caused by an ageing workforce that’s more likely to make insurance claims, continued delays in NHS treatment which causes patients to seek private options, and the increasing availability and use of costly medical procedures.
Jeremy Hill, director of Willis Towers Watson’s global services and solutions division, said:
“UK providers are attempting to curtail these annual price increases. As both the provider market and insurers have consolidated, insurers are using their size to leverage more favourable pricing agreements with key hospital groups and service providers. In addition, some smaller insurers are forming independent healthcare purchasing alliances to procure competitively priced hospital treatment for their members.
“The cost of health insurance continues to rise ahead of inflation almost everywhere in the world. While the last five years have seen relative stability in UK cost increases, the trend is starting to creep upwards and 2016 is predicted to surpass last year’s increase - for the third year in a row. In the last ten years, the cost of health insurance in the UK has almost doubled putting enormous pressure on budgets.”
