Health Care Costs Projected to Rise 10% in 2026

• By: AnneMarie McPherson Spears
• November 24, 2025

Health care costs are predicted to rise 9.6% in the U.S. in 2026, according to WTW’s “2026 Global Medical Trends” report. While next year’s increase will be slightly less than the 9.7% rise in health care costs experienced this year, it will be significantly higher than the 7.6% increase in 2024.

Globally, costs are predicted to rise by over 10%. WTW’s report, which surveyed health insurers around the world, found that 55% of insurers that expect increases also expect these elevated levels to persist for more than three years. The primary drivers are high medical costs, regional pressures on pharmacy and outpatient services, and global structural factors.

Seventy-four percent of insurers listed new medical technologies as the No. 1 driver of medical inflation. Additionally, 52% cited the decline of public health systems and 49% said advancements in pharmaceuticals drove costs. However, WTW pointed out that the same new technologies that are currently driving up prices may reduce them in the long run.

“Despite variations in healthcare provision in different countries and regions around the world, rising medical costs are a consistent trend for all,” said Linda Pham, global health and risk leader for integrated and global solutions, WTW. “One glimmer of hope for employers is that investment in technologies, including [artificial intelligence], 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.”

The leading disease driving medical costs is cancer, which 57% of insurers said was the most expensive diagnosis. Three-quarters of insurers pointed out an increase in cancer among people under 40 years old. Cardiovascular conditions ranked second among conditions driving costs, with behavioral health issues third.

“The challenge of navigating healthcare inflation for multinational employers requires strategic management,” said Courtney Stubblefield, managing director, health and benefits, 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.”

“Through careful management and applying both a short- and longer-term lens to their approach, employers can make sure they are getting the most out of their healthcare benefits while managing cost inflation,” Stubblefield said.

Health care affordability is a growing concern among U.S. adults, with 38% of insured adults under 65 worrying about affording their monthly health insurance premium, according to KFF. Independent agents can play a role by providing plan options and advice on shopping for and enrolling in health plans.

AnneMarie McPherson Spears is IA news editor.