How Much Will Health Spending Grow in 2026? | Simplefill
A recent survey that the Business Group on Health conducted revealed that employers across the nation expect to see health care costs increase by 9% in 2026. But what is leading to this significant hike in costs? Here’s what you should know about the trends that could cause such an increase for employers and even more for individual payers.
Causes of the Predicted 2026 Health Care Spending Spike
The rise of health care spending is not new. Employers and private individuals have seen costs rise across a decade or more, with some trends leading the way. These issues seem ripe to continue in 2026.
Prescription Drug Costs
According to the survey, 24% of all health care spending in 2024 went to prescription medications. Although there has been a surge in legislation that strives to curb prescription drug costs, it has not yet yielded the results consumers and employers are looking for.
The Inflation Reduction Act, for example, has given Medicare the power to negotiate the prices of some high-cost drugs, but this only applies to some medications.
For employers, one worry is the increase in GLP-1 use for the treatment of obesity among employees. The majority of employers cover GLP-1 medications for the treatment of diabetes, while fewer cover them for obesity. One of the ways they’re considering cutting costs is by reducing coverage of these medications.
Cancer Costs
The Business Group on Health survey also shows that cancer is the most reported condition among employees. One of the issues is that cancer diagnosis is happening more often among younger populations.
To combat this, cancer screenings are on the rise. Although these preventive measures will lower costs in the long run, they can put a strain on health care spending in the short term.
Mental Health Costs
Another trend is the rise of mental health spending. This includes coverage for mental illness as well as for the treatment of substance use disorders. As part of the Affordable Care Act, employers have to cover these services, and there are no annual or lifetime limits.
Expiration of Enhanced Affordable Care Act Tax Credits
At the end of 2025, the enhanced subsidies from the Affordable Care Act are poised to expire. Unless Congress renews them, it could mean a serious increase in premiums for many enrollees.
The Center on Budget and Policy Priorities conducted an analysis of what enrollees of the Affordable Care Act saved in 2024 because of the tax credits that are about to expire. The answer was an average of $705. Without the credits, out-of-pocket premiums would increase by more than 75%.
This would make affording coverage almost impossible for thousands of households across the country. If these people no longer have coverage, then they rely on emergency services to address any health issues they develop. This further increases overall spending.
Get Affordable Access to Prescription Medications
Simplefill is a full-service prescription assistance company that researches, qualifies, and maintains patients’ enrollment in all sources of assistance available to them
Apply today by calling 877-386-0206. A caring Simplefill representative will contact you within 24 hours to discuss your application and, if qualified, enroll you in the program.
Frequently Asked Questions
Will the Affordable Care Act Tax Credits Be Renewed?
As of October 2025, Congress is still debating whether to extend these subsidies. In some states, the delay has already made it too late for those credits to apply without significant disruptions.
Why Are Health Care Costs in the United States So High Compared to Other Developed Nations?
In the United States, services and medications cost more than in other countries. This occurs because of a lack of government regulation and the inability to negotiate for better rates. The complexity of the insurance system, too, leads to significant overhead costs. Additionally, U.S. health care provider salaries are much higher than in other countries.
Is There a Way to Lower Medication Costs?
Although there is legislation in place to lower costs, medications are still difficult to afford for many people dealing with chronic conditions. There are prescription programs you can join that help you find the best rates and discounts for the drugs you need. Asking for biologic or generic options can also be helpful in lowering costs.
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