UAE: Medical costs projected to jump by 11.5% in 2025
Source: Middle East Insurance Review | Jan 2025
Medical costs in the UAE are projected to climb by double digits in 2025, according to the findings of the WTW Global Medical Trends Survey 2025.
The increase is expected at 11.5% on a gross basis, marginally higher than 2024’s growth of 11.5%. Net of inflation, however, medical costs are projected to rise by 9.5% in 2025.
The WTW report said that the growing claims for high-cost medical providers contributed to the rise.
The insured are increasingly utilising these providers in order to receive the best medical care available. There’s also been an upward trend in the overall utilisation of healthcare with members becoming more health conscious.
Healthcare providers, across the board, have been raising service costs annually to increase profit margins. At the same time, there are no consistent tariff rates (application of fixed rates for services) across insurers among their providers, which hinders consistency and stability of pricing.
Overtesting, increased pharmacy costs from overprescription and a reliance on international supply chains combined with worsening currency exchange rates, deregulation of price caps and inflation, have contributed to higher costs.
The introduction of new and costly technologies in healthcare facilities has also led to higher service costs as providers seek to ensure a return on investment. There are moves to restrict network access and limit the use of costly providers, to manage costs.
The projected jump of 11.5% in medical costs in 2025 in the UAE is higher than the expected average global rate of 10.4%. M