TORONTO, Nov. 13,
2024 /CNW/ -- Aon plc (NYSE: AON), a leading
global professional services firm, has released its 2025 Global
Medical Trend Rates Report. In Canada, the report forecasted the average
medical trend rate for 2025 to be 7.4 percent, up from 5.0 percent
in 2024.
The medical trend rate represents the percentage increases in
medical plan unit costs – insured and self-insured – required to
address projected price inflation, technology advances in the
medical field, plan utilization patterns and cost shifting from
social programs.
"In 2025, we anticipate a return to more typical inflationary
conditions, with the Bank of Canada projecting that inflation will be well
under control," said Joey Raheb,
senior vice president and Canadian national leader for growth and
client engagement for Health Solutions at Aon. "However, our
concerns are now shifting towards continued economic slowdowns,
which will undoubtedly influence plan sponsor decisions. While we
have yet to witness a full-scale pullback on spending, employers
are exercising caution and continuously reviewing their plans for
efficiency in delivery and optimal medical efficacy. Discussions
are expected to continue to be dominated by GLP-1 drugs and chronic
conditions, such as diabetes. Alongside these, efficient plan
design that allows employers to deliver programs that meet the
needs of a diverse workforce while keeping costs sustainable will
remain a focal point."
The top medical conditions driving medical plan costs in
Canada are:
- Diabetes
- Autoimmune Diseases (excl. Diabetes)
- Mental health
- Lung disorder/respiratory
- Cardiovascular & Weight loss
In its global report, Aon forecasts medical plan costs across
the world will rise on average 10.0 percent in 2025, this figure is
just shy of the projected increase for 2024 of 10.1 percent, which
represented the highest increase forecasted in 10 years.
"Despite inflation projected to decrease in 2025, we expect
health and wellbeing costs will continue to rise. As a result,
medical plans are an important concern for companies, especially
those with a global footprint," said Kathryn Davis, vice president of global benefits
at Aon. "Rising costs often bring unexpected budget increases and
makes affordability for employers and employees more
difficult."
"As employer-sponsored medical plans become a larger part of
total rewards spend, we are seeing businesses leverage trend rate
data to inform their budgets and benefits strategies," Davis added.
"Wellbeing initiatives are again the leading mitigation strategy as
they help to control costs by encouraging utilization of
preventative care and by keeping employees engaged in their
wellbeing."
Aon conducted the survey across 112 countries and locations that
broker, administer or advise on employer-sponsored medical plans in
each of the countries covered in this report. The survey responses
reflect the medical trend rate expectations of Aon professionals
based on their interactions with clients and carriers represented
in the portfolio of the firm's medical plan business in each
location.
Read Aon's 2025 Global Medical Trend Rate Report here.
About Aon
Aon plc (NYSE: AON) exists to shape decisions for the
better — to protect and enrich the lives of people around the
world. Through actionable analytic insight, globally integrated
Risk Capital and Human Capital expertise, and locally relevant
solutions, our colleagues provide clients in over 120 countries
with the clarity and confidence to make better risk and people
decisions that protect and grow their businesses.
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Media Contact
Alexandre
Daudelin
Alexandre.daudelin@aon.com
+1 514 467.9330
SOURCE Aon plc