Pune (Voice News Service): Aon’s Global Medical Trend Rates Report 2025 highlights the continued rise in medical plan costs, with a projected global medical trend rate of 10.0 percent for 2025. Although this is a slight decrease from 10.1 percent in 2024, it marks the second consecutive year of double-digit increases, underscoring the growing challenge businesses face in managing healthcare expenses worldwide.
India’s Healthcare Costs Among the Highest
India stands out with one of the highest projected medical trend rates at 13.0 percent, up from 12.0 percent in 2024. This increase is driven by rising hospitalisation rates and the growing adoption of advanced medical treatments. With healthcare inflation consistently outpacing general inflation, employers in India are under increasing pressure to design sustainable medical benefits for their workforce.
Several factors contribute to rising medical inflation, including:
- Advanced prescription medications
- Cardiovascular diseases and hypertension
- Cancer treatment costs
A key factor is the demand-supply mismatch in healthcare. A shortage of quality infrastructure and skilled professionals has led to higher medical service costs, making healthcare less accessible.
Additionally, the increasing use of innovative treatments, particularly biologics, has significantly raised treatment expenses. While these advancements improve patient outcomes, they also drive up overall medical costs. Moreover, rising insurance premiums, fueled by higher claims and escalating medical expenses, are further increasing the issue.
Strategies to Manage Rising Healthcare Costs
To address these challenges, businesses in India are adopting proactive measures such as:
- Flexible benefits plans – Offering employees customisable healthcare options.
- Data-driven healthcare strategies – Using analytics to optimise costs and improve outcomes.
- Preventive health initiatives – Promoting wellness programs to reduce long-term medical expenses.
- Hospital network optimisation – Partnering with cost-effective, high-quality healthcare providers.
Balancing Cost and Quality in Employee Healthcare
As medical costs in India continue to rise, employers must adopt a strategic approach to healthcare benefits. Balancing cost control with ensuring access to quality medical care will be essential for sustaining a healthy and productive workforce.
