Rising Medical Costs in Indonesia 2024: Challenges and Solutions

28 Mar 2024
Redaksi Liveaman
Mins

In 2024, Indonesia faces major challenges in the healthcare sector with a projected 13% increase in rising medical costs. Based on the MMB Health Trends 2024 report, healthcare costs in Indonesia are expected to continue rising, affecting companies and individuals at large.

Projected Increase in Rising Medical Costs in Indonesia

According to the MMB Health Trends 2024 report, the projected increase in medical costs in Indonesia is 13%. Factors influencing this projection include inflation, medical technology, and the growing demand for healthcare services.

Inflation plays a key role in rising medical costs. Rising prices of drugs, medical equipment, and overall healthcare services can be linked to inflation. This creates additional pressure on companies and individuals who have to face rising costs without a commensurate increase in income.

The introduction of new medical technologies and advanced equipment also contributes to rising healthcare costs. While these technologies often improve the quality of care, the cost of implementation can be burdensome for companies and individuals.

Demand for Healthcare Services

The growing demand for healthcare services is also a major factor in rising medical costs. With increasing awareness of the importance of healthcare and improved living standards, people are seeking better healthcare services, which in turn increases overall costs.

Impact on Companies and Individuals

Rising medical costs have a significant impact on both companies and individuals.

Impact on Companies: Companies have to face pressure in managing their employee health budgets. Rising medical costs can lead to a significant increase in employee benefits management costs. This requires companies to evaluate their strategies in addressing the rising costs.
Impact on Individuals: People must also prepare themselves for the higher cost of care. Health insurance and financial planning are important to protect individuals from the financial impact of rising medical costs.

Medical Inflation in Indonesia: Trends and Causal Factors

Data from June 7, 2023 shows that healthcare costs in Asia experienced a significant increase in inflation, especially in Indonesia. The cost increase reached 13.6 percent after the COVID-19 pandemic, exceeding the average increase in Asia of 11 percent. Contributing factors include rising prices of medical goods, increased insurance claims, and delays in treatment during the pandemic. The impact can be seen in the increase in the total amount of health claims in the first quarter of 2023, reaching IDR 4.60 trillion compared to IDR 3.32 trillion in the previous year.

Graph of medical cost in Indonesia for 2015-2014: Ini Perkembangan Anggaran Kesehatan Indonesia sampai 2024 (katadata.co.id)

Medical inflation is in line with the increase in health service tariffs at the beginning of 2023, as stipulated in the Minister of Health Regulation Number 3 of 2023 concerning Standard Service Tariffs in the Implementation of the Health Insurance Program. In addition, general inflation in 2022, which reached 5.5 percent, also had an impact on the increase in health costs. Rising health costs are an unavoidable reality, with rising medical costs continuing to occur year after year.

Solutions and Strategies for Dealing with Rising Medical Costs

The rising medical costs in Indonesia demand a comprehensive solution to address this challenge.

Health Insurance: Having adequate health insurance can help mitigate the impact of rising medical costs for individuals and companies. Health insurance provides important financial protection and can help reduce the burden of unexpected medical costs.
Health Promotion: Public education and awareness about disease prevention and healthy lifestyles can reduce the need for expensive medical care. Efforts to raise awareness about the importance of a healthy lifestyle can help reduce the demand for healthcare services and thus reduce overall medical costs.
Negotiation: Companies can negotiate with healthcare providers for better rates. These negotiations can help companies manage their healthcare budgets more effectively and reduce the impact of rising medical costs.

Strategies for Dealing with Rising Health Costs in the Future

Take Care of Your Health: A healthy lifestyle and regular exercise can be important steps to prevent non-communicable diseases, which are the main cause of rising healthcare costs. Research has shown that 20 minutes of exercise a day can reduce the risk of developing heart disease, diabetes and cancer.
Have Health Protection: Health insurance can be an important financial protection against rising health costs. By having adequate health insurance, individuals can cope with high health costs without having to worry about the impact on personal finances.
Manage Emergency Fund: An emergency fund is a basic step in maintaining financial health. Although core inflation showed a decline in March 2023, it is important for individuals to remain vigilant and prepare an emergency fund as a safety measure against the risk of rising health costs in the future.

Conclusion: Early Preparation for a More Secure Future

Careful preparation can help individuals overcome the risks arising from rising healthcare costs in Indonesia. With a good understanding of medical inflation and its contributing factors, as well as the implementation of protection strategies such as healthy lifestyle, health insurance, and emergency fund management, individuals can minimize the negative impact of rising healthcare costs. Thus, people in Indonesia can ensure access to quality healthcare without having to worry about excessive financial burden.

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