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U.S. employers project a median healthcare cost increase of 10 percent for 2026, according to new survey results from the International Foundation of Employee Benefit Plans. A similar survey that the foundation conducted in 2024 projected a median cost increase of 8 percent for 2025.
“The 10 percent projected increase is attributed to a variety of factors impacting organizations’ medical plan costs, with catastrophic claims and specialty/costly prescription drugs topping the list,” Julie Stich, vice president of content at the foundation, said in a statement. “Employers have indicated that cost sharing, plan design, and purchasing/provider initiatives will be the most impactful techniques to manage costs.”
Data was collected from corporate and single employers between July 30 and August 7, and the report is designed to help U.S. plan sponsors “navigate the changing landscape and learn about healthcare costs for the coming year,” according to the foundation’s “Pulse Survey: 2026 Cost Trend” report.
Employers also shared their thoughts on the primary causes of the rise in medical plan costs for 2026. The top four factors are:
- Catastrophic claims, cited by 31 percent (up from 20 percent year)
- Specialty/costly prescription drugs, cited by 23 percent (up from 20 percent last year)
- Utilization due to chronic health conditions, cited by 15 percent (down from 16 percent last year)
- Medical provider costs, cited by 11 percent (down from 18 percent last year).
Respondents who selected specialty/costly prescription drugs as a primary reason for the cost increase indicated that GLP-1 drugs, cancer drugs, and cell and gene therapy were predominantly responsible for the increase.
When asked what types of initiatives would be the most effective in managing costs for 2026, respondents indicated the following strategies for the upcoming plan year:
- Cost-sharing initiatives such as deductibles, coinsurance, copays, and premium contributions, cited by 27 percent (up from 21 percent last year)
- Plan design initiatives such as dependent eligibility audits, high-deductible health plans, spousal surcharges/carve-outs, and formulary changes, cited by 17 percent (up from 15 percent last year)
- Purchasing/provider initiatives such telemedicine, price transparency tools, centers of excellence, healthcare navigators/advocates, coalitions, and quality initiatives, cited by 17 percent (up from 9 percent last year)
- Utilization-control initiatives such as prior authorization, case management, disease management, and nurse advice lines, cited by 12 percent (down from 27 percent last year).
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From: BenefitsPRO
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