The cost of medical care is expected to rise globally by 10.3% in 2026 according to a new survey by global advisor WTW.
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Boards and C-suite leaders continue to be concerned about employee wellbeing and the increasing costs of medical care, which are expected to rise globally by 10.3% in 2026, according to WTW’s recently published 2026 Global Medical Trends Survey. Effective leaders understand the causes of healthcare cost increases and take action to mitigate the impact while offering quality care.
According to the WTW survey, medical inflation remains highest in Asia Pacific, where increases are expected to reach 14% in 2026, up from 13.2% in 2025. Latin America expects the sharpest acceleration, jumping to 11.9% from 10.5%. The Middle East and Africa also are projected to accelerate, reaching 11.3% in 2026. North America and Europe are forecasted to increase by 9.2% and 8.2% in 2026, in line with 2025 trends.
As intangible assets continue to rise in proportion to corporate valuations, boards and senior management teams increase their focus on employee wellbeing and its link to performance. Today, effective leaders prioritize employees’ physical and mental health issues – and access to healthcare – while remaining mindful of the associated costs and value.
Key factors influencing medical trend rates
According to the survey, costs are rising across all areas of healthcare, though reasons for the increases vary regionally. New medical technologies are the leading global driver, cited by 74% of survey respondents. This is followed by the decline of public healthcare systems worldwide (52%),advancements in pharmaceuticals (49%), and fraud, waste and abuse (38%). Regional variations in the factors driving medical inflation highlight differences in healthcare needs and systems.
In the Americas, advancements in pharmaceuticals are the top factor driving medical costs, cited by 67% of participants, versus new medical technologies in Asia Pacific (77%) and Europe (76%), and fraud, waste and abuse in the Middle East and Africa (79%).
Cancer is the leading condition driving medical claim costs
Cancer is the leading contributor to claims expenses and the fastest-growing condition in terms of utilization and cost in nearly every region. Additionally, over the past year, 74% of insurers report an increase in cancer in those under age 40, aligning with recent medical research showing an increase in early-onset cancer.
Participants report the most effective ways to reduce cancer costs are prevention through reducing risk factors (70%), screening (69%), and offering wellbeing programs (35%). All regions report screening as effective in reducing cancer claims, and many countries have invested in expensive early detection technology to help reduce the high-cost claims of late-stage cancer.
Behavioral health focus continues
Behavioral health coverage, including mental health, stress management and substance disorder treatment, is covered by 61% of insurers globally, with another 21% planning to cover them soon. The Americas (73%) and Europe (71%) report the highest coverage, with Asia Pacific (48%) and Middle East and Africa (30%) lagging, though 37% of insurers in the Middle East and Africa plan to expand coverage in the next few years.
Employer demand for behavioral health services is strong, with increasing requests for psychological and psychiatric care, virtual counseling, expanded outpatient support and resilience-focused therapy apps. Many insurers have expanded mental health coverage in their standard programs, adding wellness initiatives, therapy apps, psychotherapeutic treatment and substance-abuse support to their standard medical insurance programs. In countries where stigma around mental health still exists, care resources remain less available.
GLP-1 drugs for obesity expected to rise
Globally, only 38% report GLP-1 drugs are covered for obesity in their plans. The Americas stand out with 55% reporting coverage. Yet 68% of insurers globally expect usage to increase over the next three years, particularly in the Americas (73%) and Europe (77%), and to a lesser extent in the Middle East and Africa (64%) and Asia Pacific (55%). In the Americas, 78% expect an increase in costs, followed by Asia Pacific (66%), Europe (64%) and Middle East and Africa (53%).
GLP-1’s help reduce diabetes, heart and kidney disease, and potentially cancer. Many public and private health plans limit use of GLP-1’s due to cost, with restrictions often requiring the presence of conditions other than obesity, such as diabetes or cardiovascular issues, and/or limits on the duration of the therapy.
Tariffs and trade policies are expected to negatively impact healthcare costs
Globally, 81% of insurers expect tariffs to increase healthcare costs over the next three years. The top concern is supply-chain disruptions and their impact on hospital and provider costs. Hospitals and healthcare providers anticipate further increases in their expenses for medical supplies and pharmaceuticals because of increased trade barriers, which also could increase insurance premiums.
Artificial intelligence (AI) in healthcare
While currently only 17% of insurers report significant use of AI in healthcare programs, usage is expected to rise to 37% within two years. The largest AI investments are in plan administration (58%), navigation solutions (37%), communication (36%) and program evaluation (32%). These focus areas are generally consistent across regions, except in the Middle East and Africa where the largest investments are in wellbeing (68%).
AI is projected to play a growing role across the healthcare ecosystem, for example in improving diagnostics and treatment efficiency, use for early detection of cancer and other diseases, personalized treatment planning, automation of services, and data and analytics. AI also is expected to play a valuable role in hospital management to improve efficiency amid ongoing productivity challenges and staffing shortages.
How can leadership optimize healthcare benefits and spending?
Medical costs continue to grow worldwide, despite regional variance in healthcare landscapes. The challenge for multinational employers in navigating rising costs remains constant and requires strategic program management and budget forecasting.
Effective leaders take the following actions:
Spotlight cancer awareness and prevention – Provide screenings and preventative services (e.g., mammograms). Drive educational programs.Prioritize mental health – Ensure that mental health coverage is available through insured and non-insured programs. Expand digital mental health programs. Optimize services and resources for supporting employees.Include flexibility and choice where possible – Include flexibility and choice in benefits programs, enabling employees to select and use the benefits they need most.Consider employee cost share – Introduce copay or coinsurance to encourage more thoughtful medical spending. Invest in education and prevention – Empower employees to use healthcare benefits wisely by offering targeted guidance on when and how to access services; stress the importance of preventive care.
Managing medical costs while supporting employee wellbeing will continue to challenge executives and boards in 2026. Prioritizing preventative care, flexible benefits and smart healthcare education can help.