Employee Health Benefits 2026: Prevailing Trends & New Approaches

The same trends that have been driving the market in recent years seem to be here to stay. Higher premiums and drug prices lead the story, with continued growth in behavioral health. Cost containment is key as companies consider benefits redesign and alternative health plan models. Digital tools and AI-enabled systems are also top of mind for scalable efficiencies and data-driven decision making.

Escalating health care insurance premiums

Almost 100% of American workers at companies with 200+ employees receive benefits through their work. That number shrinks to 73% for those working at smaller companies.¹ A perfect storm of inflationary trends continues to increase premiums for all. 

Costs are forecasted to rise higher in 2026 than at any time in the previous 15 years.² Multiple factors combine, with prescription drug costs being a main driver of overall premium costs. Additional factors include higher utilization rates, provider consolidation, advanced therapies, treatment for chronic conditions, and hospital fees, among others.

Rising prescription drug costs, led by GLP-1 

Research from HR consulting firm The Segal Group³ projects that prescription drug cost increases will reach 11.4% in 2026. Specialty drug costs could rise 11.9%.

GLP-1 (glucagon-like peptide-1) medications for obesity and weight loss play a significant role in increased costs. About 36 million American workers have a body mass index (BMI) that would qualify for a GLP-1 prescription.¹ The main patent for GLP-1 will expire in the early 2030s, making generic equivalents available.

Specialty medications prescribed for rare genetic conditions, cancer, and/or complex multi-system conditions also contribute to cost increases. Cancer alone is another top driver of health care expense due to a greater incidence of diagnoses.⁴

Expensive specialty medications can sometimes come with preauthorization delays. Highmark has created relationships with specialty drug manufacturers who can speed the necessary medications to our members, often at a reduced cost. 

Increasing demand for behavioral health coverage

In 2025, 73% of employers noted an increase in claims for mental health and/or substance use disorder services.⁴ Thirty-seven percent of Gen Alpha (born 2010 – 2025) receive mental health care for anxiety, depression, attention deficit hyperactivity disorder (ADHD), and/or autism.³

Reasons for higher utilization include greater availability of behavioral health coverage and reduced stigma through increased awareness. Unit cost and quality of care are top considerations. Highmark's Mental Well-Being solution ensures that necessary treatment is delivered correctly for the right duration. 

Managing total cost of care: benefits redesign and alternative health plans

Researchers forecast average health care costs to rise 9% in 2026. However, plan redesign can reduce that increase by about 1.25%. Areas of focus for employers include managing high-cost claims, measuring performance, and improving access to behavioral health.⁴

Alternative employer benefits health plans are increasingly available. Options include:

• Administrative Services Only (ASO)
  The employer pays employee health insurance claims, while the insurer manages all administrative work.
  
• Individual Coverage Health Reimbursement Arrangement (ICHRA)
  The employer reimburses employees for individual marketplace insurance instead of offering a group health plan.
• Professional Employer (PEO)
  A third-party firm co-employs a company's workers, providing access to HR services and a large group employee health insurance plan.
• Tiered and copay-only plans
  These plans utilize lower-cost provider networks or preferred provider tiers. Employees have simple copays without annual deductibles. Highmark's CopayGo solution is an example of this type of Alternative Health Plan (AHP).

Benefiting from digital health tools and AI efficiencies

Artificial intelligence continues to improve the health care experience. Providers now have tools that reduce administrative time, including ambient scribe technology that adds notes to a patient's electronic chart.

Insurers have access to new ways of working as well. Highmark is a leader in using AI to automate workflow, deliver real-time data, detect fraud, reduce errors, and improve compliance. Our members also benefit from this technology via chatbots, virtual assistants, and the My Highmark app and digital experience.

We'll be sharing more of our thought leadership on these 2026 trends and other topics in the months to come. Meanwhile, please contact your Highmark account manager or employer health benefits broker for details on any of the solutions noted above.

_{All references to “Highmark” in this communication are references to Highmark Inc., an independent licensee of the Blue Cross Blue Shield Association, and/or to one or more of its affiliated Blue companies.}