Overview
The employer-sponsored medical plan costs worldwide to climb 9.8% in 2026, according to Aon’s Global Medical Trend Rates Report. That projection marks a shift back to single-digit growth for the first time since 2023.
The “medical trend rate” tracks the yearly increase in unit costs for employer health plans, factoring in price inflation, new technologies, greater usage, and higher prescription drug expenses.
For global employers, this metric sets the baseline for how much more expensive health benefits will be to deliver.
Medical trend: projected annual rise in global patient treatment costs
Medical trend refers to the predicted annualpercentage increase in the cost of treating patients and providing healthcare services, serving as a tool to forecast rising healthcare expenses by considering factors like inflation, service utilization, prescription drug costs, and advancements in medical technology, according to Global Benefits Standards.
It differs from medical cost, which is the current baseline amount, while medical trend represents the rate at which these costs are expected to grow.
Typically, medical costs are assumed to increase every year; a declining trend means costs are rising more slowly than before, not that they are decreasing. Costs only decrease compared to the prior year if the medical trend is negative.
The trend rate figures shown in this report represent the percentage increases in medical plan unit costs, both insured and self-insured, that are anticipated for the coming year, Beinsure noted.
Forecasted Medical Trend Rate from 2025 to 2026
| Region | 2025 | 2026 |
| Global | 10.0% | 9.8% |
| North America | 8.8% | 9.3% |
| Asia-Pacific | 11.1% | 11.3% |
| Europe | 8.9% | 8.2% |
| Latin America and Caribbean | 10.7% | 10.3% |
| Middle East and Africa | 15.5% | 15.3% |
Rising healthcare costs have become a pervasive business challenge
Kathryn Davis, Aon’s global benefits VP, said the report lands in an environment where inflation is cooling in some economies but healthcare costs refuse to ease.
Organizations need predictive analytics and innovative cost management strategies to manage volatility and support long-term benefit strategy.
U.S. health insurers administering state Medicaid coverage will encounter revenue pressure from OBBBA. New work requirements could increase acuity in the Medicaid pool.
Medicaid enrollment stood at 78.6 mn as of March 2025, comprising 71.3 mn in Medicaid and 7.3 mn in the Children’s Health Insurance Program (CHIP).
Medicaid will experience a sharp drop in enrollment and premium revenue under the One Big Beautiful Bill Act (OBBBA) as stricter, more frequent eligibility reviews and new work requirements take effect in expansion states by the end of 2026 (see US Health Insurance Market Trends: Rates, Price and Coverage).
Key Medical Conditions Driving Costs in 2026
- Cardiovascular Disease remains the top medical condition anticipated to influence plan costs in 2026. This trend is consistent across all regions, with more than 20 countries identifying it as the most impactful condition.
- Cancer/Tumor Growth ranks among the top five cost-driving condition in every region in every region, with 20 countries identifying it as the most impactful. The most commonly diagnosed cancers globally include lung, breast, colorectal and prostate cancers.
- High Blood Pressure/Hypertension continues to be a leading risk factor for numerous other conditions and is consistently cited as a key driver of medical claims. It was identified as the most impactful condition by 18 countries.
In addition to macroeconomic global factors, trends in the healthcare space are also contributing to persistently high medical inflation rates compared to historical norms, Beinsure noted.
“These include higher utilization rates, the adoption of new advanced technologies and a growing demand for private healthcare services. Additionally, aging populations in Europe, APAC and Latin America are emerging as key drivers of rising medical costs,” Davis added.
Global average medical trend rate for 2026
Despite sustained upward cost pressures, the global average medical trend rate for 2026 is expected to be 9.8%, continuing the trend from last year of declining increases year over year and a return to a global increase rate in the single digits for the first time since 2023 (see Impact of Excess Mortality after COVID-19 on Life & Health Insurance).
In this year’s results, we continue to see variation in the medical trend both within and across regions. Therefore, it remains important to highlight regional trends, including the conditions driving the trend rate and the ways in which companies are mitigating the increases within countries and regions.
Regionally, the outlook splits
- North America’s trend rate is forecast at 9.3% for 2026, up from 2025, while Asia-Pacific is projected to rise to 11.3%.
- Europe, by contrast, is expected to see the steepest fall, from 8.9% in 2025 down to 8.2%.
- Latin America and the Caribbean remain expensive, with a forecast of 10.3%, but that’s lower than last year thanks to declines in several large markets.
- In the Middle East and Africa, the trend rate is pegged at 15.3%—still the highest globally but slightly down as inflationary pressure eases.
Key medical trends across regions
North America medical trends
While still the second lowest gross medical trend rate across the regions, North America (comprised of Canada and the United States) is one of only two regions with an anticipated gross medical trend rate higher than that predicted for 2025, at 9.3% (up 50 basis points (bps) from 8.8% in 2024) and the region with the highest year-over-year increase, Beinsure noted.
While many factors drive costs higher in North America, it is notable that the gross medical trend
rate moved almost exactly in tandem with the inflation rate (which increased 40bps).
| Nation/Country | 2025 Annual General Inflation Rate | 2025 Annual Medical Trend Gross | 2025 Annual Medical Trend Net | 2026 Annual General Inflation Rate | 2026 Annual Medical Trend Gross | 2026 Annual Medical Trend Net |
| North America | 2.0 | 8.8 | 6.8 | 2.4 | 9.3 | 6.9 |
| Canada | 1.9 | 7.4 | 5.5 | 2.1 | 8.3 | 6.2 |
| United States | 2.0 | 9.0 | 7.0 | 2.5 | 9.5 | 7.0 |
Asia-Pacific medical trends
APAC is the second region with an anticipated gross medical trend rate higher than what was predicted for 2025, at 11.3% (up 20bps from 11.1% in 2024).
This is especially notable as inflation is cooling semi-significantly in APAC (decrease of 40bps since last year), so the increase in the net medical trend rates is much higher at 60bps (8.9% vs. 8.3%).
Around one third of APAC markets – including China, Singapore, the Philippines and India – expect a slight decrease in medical trend rates for 2025, due to moderated utilization and wellbeing initiatives.
| Nation/Country | 2025 Annual General Inflation Rate | 2025 Annual Medical Trend Gross | 2025 Annual Medical Trend Net | 2026 Annual General Inflation Rate | 2026 Annual Medical Trend Gross | 2026 Annual Medical Trend Net |
| Asia-Pacific | 2.8 | 11.1 | 8.3 | 2.4 | 11.3 | 8.9 |
| Australia | 3.0 | 5.1 | 2.1 | 3.5 | 5.2 | 1.7 |
| Bangladesh | 6.1 | 10.0 | 3.9 | 5.2 | 10.0 | 4.8 |
| China | 2.0 | 8.0 | 6.0 | 0.6 | 7.8 | 7.2 |
| Hong Kong | 2.3 | 8.0 | 5.7 | 2.2 | 9.0 | 6.8 |
| India | 4.2 | 13.0 | 8.8 | 4.1 | 11.5 | 7.4 |
| Indonesia | 2.6 | 16.2 | 13.6 | 2.5 | 16.9 | 14.4 |
| Japan | 2.1 | 0.9 | (1.2) | 1.7 | 2.7 | 1.0 |
| Kazakhstan | 7.0 | 29.0 | 22.0 | 9.4 | 29.0 | 19.6 |
| Malaysia | 2.5 | 15.0 | 12.5 | 2.2 | 16.0 | 13.8 |
| New Zealand | 2.5 | 17.0 | 14.5 | 2.0 | 18.0 | 16.0 |
| Pakistan | 12.7 | n/a | n/a | 7.7 | 23.5 | 15.8 |
| Philippines | 3.0 | 15.0 | 12.0 | 2.9 | 14.0 | 11.1 |
| Singapore | 2.5 | 14.0 | 11.5 | 1.5 | 13.0 | 11.5 |
| South Korea | 2.0 | 10.0 | 8.0 | 1.8 | 11.5 | 9.7 |
| Taiwan | 1.6 | n/a | n/a | 1.6 | 8.0 | 6.4 |
| Thailand | 1.2 | 14.3 | 13.1 | 0.9 | 14.8 | 13.9 |
| Vietnam | 3.4 | 12.9 | 9.5 | 2.5 | 12.2 | 9.7 |
The Middle East and Africa medical trends
The Middle East and Africa (MEA) region is projected to record higher net medical trend rates in 2026, at 7.6 percent compared with 7.3 percent in 2025. In contrast to Asia-Pacific, gross trend rates in MEA are expected to decline slightly, falling to 15.3% in 2026 from 15.5% the previous year as inflation continues to cool.
More than half of the markets in MEA are forecasting lower medical trend rate increases in 2026 than in 2025. Saudi Arabia, one of the largest markets in the region, is among those projecting a reduction. South Africa and the United Arab Emirates expect rates to remain unchanged, while Nigeria and several other markets anticipate significant increases.
The variation in projections highlights the diversity of the region. Where increases are expected, the drivers most often cited include greater demand for healthcare services, reliance on imports combined with local currency depreciation, and a heavy burden of chronic disease.
| Nation/Country | 2025 Annual General Inflation Rate | 2025 Annual Medical Trend Gross | 2025 Annual Medical Trend Net | 2026 Annual General Inflation Rate | 2026 Annual Medical Trend Gross | 2026 Annual Medical Trend Net |
| Middle East & Africa | 8.2 | 15.5 | 7.3 | 7.8 | 15.2 | 7.4 |
| Angola | 12.8 | 17.7 | 4.9 | 16.4 | 30.0 | 13.6 |
| Egypt | 25.7 | 31.0 | 5.3 | 12.5 | n/a | n/a |
| Ethiopia | 18.2 | 33.0 | 14.8 | 12.2 | 42.0 | 29.8 |
| Ghana | 11.5 | 20.0 | 8.5 | 9.4 | 21.6 | 12.2 |
| Israel | 2.5 | 11.0 | 8.5 | 2.0 | 10.0 | 8.0 |
| Nigeria | 23.0 | 34.2 | 11.2 | 37.0 | 43.0 | 6.0 |
| Saudi Arabia | 2.0 | 10.0 | 8.0 | 2.0 | 8.0 | 6.0 |
| South Africa | 4.5 | 9.5 | 5.0 | 4.5 | 9.5 | 5.0 |
| UAE | 2.0 | 11.0 | 9.0 | 2.0 | 11.0 | 9.0 |
Latin America and the Caribbean medical trends
Latin America and the Caribbean (LAC) are projected to see a slight decline in medical cost growth. The gross medical trend rate is forecast at 10.2% in 2026, down from 10.7% in 2025.
While the decrease is modest, costs remain elevated compared with historical averages. Persistent high costs are driven by advanced medical technologies, dependence on imported pharmaceuticals, and an increased frequency and severity of high-cost claims.
The reduction in trend within LAC is largely attributed to Brazil and Colombia, two of the region’s largest economies. Shifts in care patterns have reduced pressure from expensive claims such as hospitalizations, producing a modest improvement in overall projections.
Nevertheless, medical inflation remains high relative to long-term norms.
| Nation/Country | 2025 Annual General Inflation Rate | 2025 Annual Medical Trend Gross | 2025 Annual Medical Trend Net | 2026 Annual General Inflation Rate | 2026 Annual Medical Trend Gross | 2026 Annual Medical Trend Net |
| Latin America & Caribbean | 3.0 | 10.7 | 7.7 | 3.3 | 10.3 | 7.0 |
| Argentina | 59.6 | 61.0 | 1.4 | 17.8 | 21.0 | 3.2 |
| Brazil | 3.0 | 12.9 | 9.9 | 4.3 | 9.7 | 5.4 |
| Chile | 3.0 | 7.5 | 4.5 | 3.2 | 7.5 | 4.3 |
| Colombia | 3.6 | 6.8 | 3.2 | 3.1 | 9.4 | 6.3 |
| Mexico | 3.3 | 14.5 | 11.2 | 3.2 | 14.8 | 11.6 |
| Peru | 2.0 | 3.6 | 1.6 | 1.9 | 7.2 | 5.3 |
Europe medical trends
Europe again benefits from declining general inflation, with medical trend projected at 8.2% in 2026, down from 8.9% in 2025.
70% of surveyed countries in Europe anticipate a flat or declining trend compared with the previous year, including four of the region’s five largest economies.
The United Kingdom shows the most pronounced decrease, with a five percent reduction attributed to the leveling of post-pandemic surges in healthcare utilization.
This suggests that while premiums are not expected to decrease, they are likely to stabilize, leading to a modest reduction in medical inflation rates.
| Nation/Country | 2025 Annual General Inflation Rate | 2025 Annual Medical Trend Gross | 2025 Annual Medical Trend Net | 2026 Annual General Inflation Rate | 2026 Annual Medical Trend Gross | 2026 Annual Medical Trend Net |
| Europe | 2.2 | 8.9 | 6.7 | 2.0 | 8.2 | 6.2 |
| Austria | 2.8 | 3.0 | 0.2 | 1.7 | 2.5 | 0.8 |
| Belgium | 2.0 | 13.4 | 11.4 | 2.1 | 11.9 | 9.8 |
| Bulgaria | 2.7 | 23.0 | 20.3 | 2.3 | 21.0 | 18.7 |
| France | 1.8 | 4.5 | 2.7 | 1.6 | 4.5 | 2.9 |
| Germany | 2.0 | 7.8 | 5.8 | 1.9 | 7.2 | 5.3 |
| United Kingdom | 2.0 | 17.0 | 15.0 | 2.2 | 12.0 | 9.8 |
| Turkey | 38.4 | 75.0 | 36.6 | 22.8 | 45.0 | 22.2 |
| Ukraine | 7.6 | 19.0 | 11.4 | 7.7 | 24.0 | 16.3 |
Other European markets continue to anticipate moderate increases, primarily driven by higher demand for private healthcare, which in many cases reflects limitations within public healthcare systems.
These regional outlooks demonstrate that medical cost growth remains uneven across global markets.
Europe and parts of Latin America point toward stabilization, while the Middle East and Africa reflect a more complex mix of moderation and escalation, depending on country-specific conditions.
Employers are increasingly focused on cost containment and management strategies
Building on these findings, Aon’s global Human Capital insights reveal that employers are increasingly focused on cost containment and management strategies.
These include negotiating with insurance carriers, implementing wellbeing initiatives, introducing flexible benefits and increasing employee cost sharing.
Among these, wellbeing initiatives remain the most widely adopted measure, reported by 86% of countries.
“As organizations navigate rising healthcare costs, mitigation strategies are essential to sustaining workforce wellbeing and business resilience,” said Michael Pedel, head of global benefits at Aon.
By proactively leveraging data and analytics and implementing targeted strategic interventions, employers can better manage their investment, bring to life wellbeing strategies and foster healthier, more engaged teams.
This holistic approach enables organizations to achieve long-term sustainability of costs, adapt to evolving employee needs and mitigate risk.
The data underscores a familiar problem
The data underscores a familiar problem: even when headline inflation slows, medical inflation moves differently.
With advanced treatment technologies, imported drugs, and growing utilization pushing demand, employers face rising plan costs regardless of broader economic cooling.
Aon’s report makes clear that proactive cost strategies are no longer optional—they’re mandatory for organizations managing long-term benefit obligations.
FAQ
Aon forecasts that global employer-sponsored medical plan costs will rise by 9.8% in 2026. This marks a return to single-digit global growth for the first time since 2023.
The medical trend rate represents the predicted annual percentage increase in the cost of treating patients and providing healthcare services. It reflects inflation, prescription drug pricing, medical technology, and utilization. Medical cost refers to the current baseline level of expenses, while medical trend represents the rate at which those costs are expected to grow in the future.
North America’s trend rate is expected to rise to 9.3% in 2026, while Asia-Pacific is forecast to increase to 11.3%. Europe is projected to decline to 8.2%, Latin America and the Caribbean to 10.3%, and the Middle East and Africa to 15.3%. The Middle East and Africa remain the most expensive region, though the gross trend rate has slightly eased compared with 2025.
Cardiovascular disease remains the leading condition globally, cited by more than 20 countries as the most impactful driver of costs. Cancer, including lung, breast, colorectal, and prostate cancers, ranks among the top five in every region. High blood pressure and hypertension continue to be key risk factors influencing claims and long-term expenses.
Healthcare costs respond to a unique set of pressures beyond headline inflation. These include higher utilization of health services, adoption of advanced technologies, reliance on imported pharmaceuticals, and the growing demand for private healthcare. Aging populations in Europe, Asia-Pacific, and Latin America are also contributing significantly to upward pressure.
Employers are increasingly focused on targeted cost containment strategies. These include negotiating with insurance carriers, implementing workforce wellbeing initiatives, introducing flexible benefits, and increasing employee cost sharing. Wellbeing initiatives remain the most widely adopted approach, reported by 86 percent of countries.
The report highlights that medical inflation consistently outpaces general inflation, making cost management an ongoing strategic challenge. For organizations, adopting predictive analytics, resilience-focused benefit design, and proactive investment in workforce health is no longer optional. Such strategies are critical to protecting financial sustainability, supporting employees, and mitigating global volatility.
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AUTHORS: Kathryn Davis – Aon’s global benefits VP, Michael Pedel – head of global benefits at Aon
Edited by Nataly Kramer – Lead Insurance Editor at Beinsure Media
