EMPLOYERS in Singapore are facing surging health-care costs, with the bill for workers' care rising by 8.5 per cent a year.
Reasons for the jump include more expensive medical technology and patients receiving treatment they do not need, said a global survey of insurers.
Most of the 237 firms questioned believe employers' medical bills will continue to rise. However, they expect the increase to slow, partly reflecting the slowdown in the global economy.
Despite the dramatic hike in health-care spending on employees in Singapore, it has been rising by even more worldwide - 9.8 per cent a year on average.
The survey of medical insurers in 48 countries was carried out by Towers Watson, an international company that helps organisations improve efficiency.
Parkway Shenton, one of Singapore's largest health-care providers, told The Straits Times that costs to its corporate clients, which number in the thousands, had increased by about 4 per cent in the past year.
Healthway's president, Mr Lam Pin Woon, said 60 per cent of its more than 1,000 client firms had imposed limits on their employees' health spending, both annual and per visit to the doctor.
Hospital bills account for the biggest cost to firms, the survey found. Heart problems were the most expensive complaint, although many insurers expect cancer to overtake them in the coming five years.
In spite of the growing cost, Towers Watsons advises firms not to scale back on their employees' medical benefits, saying it is 'not a viable option'.
This is because doing so might simply exacerbate health issues and lead to higher costs in the long term.
It could also affect the company's ability to attract and retain good people, especially in markets 'where employer-sponsored health benefits are a key factor and could provide a crucial edge in the war for talent'.
Insurance companies say patients themselves are also partly to blame. Poor health habits such as smoking push up costs. Employees also 'overuse' their health benefits by wanting 'inappropriate' care.
Insurers in the survey said 55 per cent of companies have turned to co-payment by employees as a way to moderate spiralling costs, up from 41 per cent last year. About half of Parkway Shenton clients use this system.
Its chief executive, Dr Chai Chin Yoong, said co-payment helps as it encourages 'employees to be actively responsible for the cost of their medical treatment'. It also spurs them on to be 'more prudent in the use of their health-care benefits'.
About 28 per cent of companies ask employees to pay part of their health insurance premiums, up from just 16 per cent last year.
The survey, carried out in January, found another emerging trend. Twenty nine per cent of firms use wellness programmes to keep their employees healthy.
They are also asking insurers for better data on their workers' health in order to design schemes to help them, such as those involving chronic disease management.
Companies in North America and Europe are more likely to offer a wide range of wellness features than their counterparts in the Asia-Pacific region and Latin America.