Widespread inflation and increasing healthcare utilization are driving projected increases in global healthcare benefit costs to their highest level in nearly 15 years, according to “The 2023 Global Medical Trends Survey” by WTW.

The survey found that 78% of insurers anticipate higher or significantly higher increases over the next three years.

Globally, healthcare benefit costs are projected to increase 10% in 2023, compared with an increase of 8.8% this year and 8.2% growth in 2021, according to WTW.

Among regions on a year-over-year basis, the cost trend increases will hit Latin America the most, where costs are expected to climb 18.9% in 2023, up from an increase of 18.2% this year. This was followed by, the Middle East/Africa, with healthcare costs projected to rise 11.5% next year, up from 10.5% in 2022; Asia Pacific, 10.2%, up from 6.9%; and Europe, 8.6%, up from 8.0%.

North America is the only region expected to see a slowdown: Healthcare benefit costs are expected to rise by 6.5% in 2023, down from a 9.4% increase in 2022.

For 74% of insurers, overuse of care due to medical professionals recommending too many services or overprescribing continues to be the leading driver of medical costs. Fifty-two percent believe insured members’ poor health habits are among the top factors, and 50% cite the underuse of preventive services as a significant cost driver, which continued to increase year over year due to the avoidance of medical care during the pandemic.

Insurers identified cancer, cardiovascular conditions and musculoskeletal conditions as the top three conditions by cost, identical to last year’s findings.

Additionally, 70% cite contracted networks of providers as the most effective method for managing medical costs.

“Worldwide general inflation, overall instability in the global economy, increased healthcare utilization in the wake of the pandemic and a dynamic labor market require employers and insurers to think and act differently to address these issues in a meaningful way,” Eric McMurray, global head of health and benefits at WTW, said. “Old solutions will not work. Cost shifting is not an option. There’s a critical need for innovation, strategy and new solutions to have any substantive impact. Those that don’t lead will fall behind in their ability to manage cost and retain key talent.”

The survey was conducted between July and September and includes responses from 257 insurers representing 55 countries. The US medical trend data are drawn from other WTW research.