However, the region’s rapidly aging population and declining birth rates mean that the financial cost of this tradition will soon be too much to bear as a result of rising elderly healthcare costs.
While many developed countries in Europe have experienced a rise in the proportion of elderly people in their populations, what stands out in Asia-Pacific is the speed of aging. This compromises the ability of countries to prepare for the increased healthcare demands of an aging population. For example, in the 15 years from today to 2030, China’s elderly population is expected to rise to 18 percent, from 11 percent; a similar increase in the aged population in Germany took 25 years, according to World Bank data. In Singapore, the elderly population will rise to 20 percent of the total population, from 11 percent over this period; it took France 49 years to do the same.
Based on demographic changes and medical cost trends, we estimate that $20 trillion will be required to fund elderly healthcare in Asia- Pacific between 2015 and 2030. In Singapore, annual public and private expenditure for elderly healthcare is estimated to rise tenfold, to $49 billion by 2030, straining government budgets, infrastructure capacity, and personal savings of the elderly and their families. Across the wider Asia-Pacific, annual elderly healthcare expenditure in 2030 will be five times the 2015 total.
Asia’s $20 Trillion Elderly Medical Bill
Wolfram Hedrich discusses elderly healthcare expenditures in Asia-Pacific.
By 2030, Asia-Pacific annual elderly healthcare expenditures will be five times the cost in 2015
Wolfram Hedrich is the Singapore-based executive director and Jonathan Tan is the Singapore-based
director of Marsh & McLennan Companies’ Asia Pacific Risk Center. Oliver Wyman is a division of Marsh
& McLennan Companies.
This article is adapted from one that first appeared in Singapore’s Business Times.