Reports

Employee Medical Costs in India Set to Climb Sharply in 2026, Outpacing Global Growth

The 2026 Global Medical Trend Rates Report highlights that while the projected growth rate is lower than the 13% estimated for 2025, it still reflects persistent upward momentum in medical expenditures after two years of steep rises. The moderation suggests early signs of cost stabilisation within the broader Asia-Pacific region, where average trend rates are forecast at 11.3%.

• By Newsdesk
• New Delhi
• Dec 13, 2025

Reports

India is projected to see a significant rise in employee medical plan expenses in 2026, with costs expected to increase by 11.5%, according to a new report by global professional services firm Aon. This anticipated surge stands above the global average rate of 9.8%, underscoring inflationary pressures on employer-sponsored healthcare schemes. 

The 2026 Global Medical Trend Rates Report highlights that while the projected growth rate is lower than the 13% estimated for 2025, it still reflects persistent upward momentum in medical expenditures after two years of steep rises. The moderation suggests early signs of cost stabilisation within the broader Asia-Pacific region, where average trend rates are forecast at 11.3%.

Medical trend rates measure the annual change in per-employee medical plan costs both insured and self-insured and are a key indicator for businesses as they plan benefits strategies and budget allocations. 

The analysis identifies cardiovascular diseases, gastrointestinal conditions and cancer as primary contributors to rising claims in India, with risk factors like hypertension, high cholesterol and poor nutrition continuing to drive utilisation and costs higher. 

Aon experts note that advances in prescription and specialty medications, including biologics and other high-end treatments, coupled with an increasing chronic disease burden, are further inflating costs. A shortage of quality healthcare infrastructure and skilled medical professionals also adds to service expenses, making access uneven across regions and contributing to heightened insurance premiums. 

In response to these trends, employers are shifting toward flexible benefit plans and expanding preventive health programmes. Companies are investing in wellness services, dietetic support, telehealth solutions and personalised coverage options designed to curb long-term expenditures and improve employee wellbeing. 

“India’s healthcare landscape is evolving, with businesses increasingly adopting strategies that not only contain costs but also foster healthier, more productive workforces,” said an Aon spokesperson. 

As healthcare costs continue to outpace inflation and global averages, Indian companies are reassessing how they manage benefits, balancing rising claim pressures against innovative approaches to employee health and risk mitigation.