September 9, 2025 - Segal
In〕ate spring and summer 2025, we surveyed managed care organizations, health insurers, PBMs and TPAs about their projected 2026 trends for medical, prescription drug, dental and vision coverage. We found some projected health plan cost trends are at 10-year highs ・or more.
Since cost trend assumptions are one element that underwriters and actuaries use to project future costs for plan sponsors, this data is invaluable as you plan your organization’s 2026 healthcare coverage. The respondents to the 2026 Segal Health Plan Cost Trend Survey - our 29th annual survey of trend projections ・represent more than 80 percent of the commercially insured and self-insured market.
You’ll learn key findings about trend projections and cost drivers, including:
Survey participants were asked about emerging regulatory changes and whether these would be a factor contributing to 2026 allowed medical and/or prescription drug costs, including tariffs, scaling back of prior authorization (PA) and changes to Medicaid spending.
Survey respondents identified the top five strategies for managing the cost of medical benefits and the top five pharmacy strategies for managing the cost of pharmacy benefits that plan sponsors are using this year.
Most of these cost-management strategies will still be relevant for 2026 - and beyond.
To assess the accuracy of trend projections, we compared 2024 projected trends for medical, Rx and dental plans from a prior survey to the actual average trends for 2024 (the most recent period for which actual data is available), as reported by the survey respondents.
The report also presents actual 2024 trend data from Segal’s health data warehouse, SHAPE (Segal’s Health Analysis of Plan Experience) on:
In industries grappling with a tight labor market, plan sponsors may hesitate to shift rising costs onto participants. Implementing effective cost-management strategies can help sustain manageable trend levels and reduce the need to increase participant cost sharing. The survey report outlines strategies plan sponsors can use to monitor and manage cost trends over time.
We recommend a balanced, three-pronged approach to effective healthcare cost management. It involves managing plan design/networks, vendors and population health.
Data analytics are central to supporting each of those cost-management strategies. Regular monitoring of actual health plan claims is essential for plan sponsors to uncover emerging cost drivers.
Health plan cost trend is the measure of increases in allowed per capita claims cost. Allowed per capita claims cost is eligible billed charges (before participant cost sharing) less provider discounts.
Multiple factors influence trend, including new treatments, therapies and technologies, medical price inflation, and provider cost shifting from reduced payment by Medicare and Medicaid, to name just a few.
Although there is usually a high correlation between a trend rate and the actual cost increase assessed by a carrier, trend and the net annual change in plan costs are not the same. A plan sponsor’s costs can be significantly different from projected claims cost trends.