Dive Brief:
- Healthcare cost increases are projected to rise 9.6% in the U.S. in 2026, only a hair less than the 9.7% experienced this year, according to WTW’s 2026 Global Medical Trends report, released Tuesday. However, the increase remains “significantly higher” than the 7.6% seen in 2024.
- Globally, the average cost of health benefits is predicted to rise 10.3%, up from 10% in 2025 and 9.5% in 2024, WTW found.
- “Despite variations in healthcare provision in different countries and regions around the world, rising medical costs are a consistent trend for all,” Linda Pham, global health and risk leader for integrated and global solutions for WTW, said in a news release. “One glimmer of hope for employers is that investment in technologies, including AI, is leading to higher costs at the moment but following this phase new technologies hold the promise of reducing healthcare cost trends in the longer term.”
Dive Insight:
More than half of the health insurers surveyed who said they expect increases think elevated costs will continue for more than three years, driven by medical costs, regional pressure on pharmacy and outpatient services and global structural factors, per WTW.
Nearly three-quarters of respondents named new medical technologies as the top reason for medical inflation, followed by the decline of public health systems (52%) and advancements in pharmaceuticals (49%).
On the disease front, cancer tops the list as a medical cost driver globally, with 57% of the 346 health insurers surveyed naming it as the most expensive diagnosis. Three-quarters of insurers also noted an uptick in cancer diagnoses among those under the age of 40.
“The challenge of navigating healthcare inflation for multinational employers requires strategic management,” said Courtney Stubblefield, managing director of health and benefits for WTW. “This can include investing in education for employees on the use of health benefits, raising awareness of prevention programs for prevalent diseases like cancer, optimizing mental health coverage, and introducing flexibility of benefits.”
On average, family premiums for employer-sponsored health insurance in the U.S. were $26,993 this year, or higher than the cost of a new Toyota Corolla Hybrid, as KFF President and CEO Drew Altman put it last month. Of that, workers contribute about $6,850 annually, and employers cover the rest, according to KFF’s 2025 Employer Health Benefits Survey.
Meanwhile, a July Mercer report found that more than half of large employers, those with 500 or more employees, said they’re likely — or very likely — to make changes to their plans that would shift more costs to employees, such as raising deductibles or out-of-pocket maximums.