U.S. employer health-care costs are projected to climb 9.5 per cent in 2026, pushing average plan costs above US$17,000 per employee, according to a new report by Aon.
The report draws on the firm’s health value initiative database, which tracks plan costs and designs for more than 1,000 employers covering 7.7 million employees and US$120 billion in annual health spend.
Read: Median U.S. health benefits cost trend increasing to 9% in 2026: survey
Medical inflation continues to be driven by chronic conditions like musculoskeletal and cardiovascular disease and by high-cost cancers. Spending on prescription drugs is also climbing, with greater uptake of brand-name and specialty medications including glucagon-like peptide-1 receptor agonist medications for diabetes and obesity.
Employers remain the primary payer, covering about 81 per cent of plan costs. Between 2024 and 2025, employer contributions rose 7.2 per cent to US$12,893. Employees saw payroll premiums increase 4.7 per cent to nearly US$3,000, while out-of-pocket costs grew to almost US$2,000. On average, employees are now expected to spend just under US$5,000 for health coverage this year.
The report found employers are using strategies such as plan redesign, payroll contribution adjustments and targeted condition management to soften the impact. However, sustained cost growth is limiting their ability to invest in other priorities like compensation, career development and well-being supports. With another sharp increase forecast for 2026, the report notes employers are relying more heavily on predictive analytics to manage risk and plan for long-term sustainability.
Read: U.S. employers projecting health benefits cost increase of 8% for 2025: survey