Employers in the U.S. are projecting a median increase of 10% in healthcare costs for 2026, a new survey from the International Foundation of Employee Benefit Plans found.
The International Foundation of Employee Benefit Plans is a nonprofit focused on providing educational information to those working in the employee benefits industry. It has more than 31,000 employer members representing over 25 million lives.
The organization’s survey, released Thursday, was conducted between July 30 and August 7 and included responses from 150 corporate and single employers. The 10% projected increase in healthcare costs is up from a similar report last year that projected an 8% median increase for 2025.
When asked what the primary factors contributing to the increase in medical plan costs were for 2026, 31% said “catastrophic claims,” an increase from 20% who said this last year. Following catastrophic claims, 23% said specialty/costly prescription drugs, 15% said utilization due to chronic conditions and 11% said medical provider costs.
Among those who chose specialty/costly prescription drugs as a primary factor for cost increases, 59% said that GLP-1 drugs were a major reason (this is down from last year, when 75% said GLP-1s were responsible). After GLP-1s, 50% said cancer drugs, 21% said cell and gene therapy and 26% said other drugs.
To combat these rising costs in 2026, 27% of respondents said that implementing cost-sharing initiatives — such as through deductibles, coinsurance, copays or premium contributions — will be the most impactful. This is up from 21% who said this last year. In addition, this is consistent with what Mercer found in its recent survey, in which 51% of large employers said they are likely or very likely to shift costs to employees in 2026.
About 17% of respondents in the International Foundation’s survey said that implementing plan design initiatives will also be effective. This includes dependent eligibility audits, high-deductible health plans, spousal surcharges and formulary changes.
Another 17% said they will use purchasing/provider initiatives, like telemedicine, price transparency tools, centers of excellence, healthcare navigators and quality initiatives.
Lastly, 12% of respondents reported that they’ll implement utilization control initiatives, such as prior authorization, case management, disease management and nurse advice lines. This is a significant decrease from last year, however, when 27% said they’ll use utilization control initiatives.
“The 10% 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,” said Julie Stich, CEBS, vice president of content at the International Foundation of Employee Benefit Plans, in a statement. “Employers have indicated that cost-sharing, plan design and purchasing/provider initiatives will be the most impactful techniques to manage costs.”
Photo: Ta Nu, Getty Images
