The average medical trend cost rate for 2026 in the UK will decline to 12%, down from 17% in 2025, according to Aon.
However, the consulting firm’s data showed the UK would continue to host one of the highest inflation rates around the world, only being outpaced by the Midde East and Africa.
Its 2026 Global Medical Trend Rates Report forecast that medical plan costs across the world will rise by an average 9.8% in 2026, marking a return to single-digit global growth rates for the first time since 2023.
The analysis was informed by Aon professionals in more than 100 locations who broker, administer or advise on employer-sponsored medical plans.
The medical trend rate represents the predicted annual percentage increase in employer-sponsored medical plan unit costs required to address projected price inflation, cost of technology advances, higher plan utilisation and the rising cost of drugs, especially for cancer treatment.
The top medical conditions driving medical plan costs in the UK are musculoskeletal (MSK) and back issues, cancer and tumour growth and mental health disorders.
Global trends
Across the continent, Europe again benefited from a declining annual general inflation rate, with a projected medical trend for 2026 of 8.2%, down from 8.9% in 2025.
North America, made up of Canada and the United States, remained the second lowest rate but was one of only two regions with an anticipated increase higher than predicted for 2025, at 9.3% – up from 8.8%. It was also the region with the highest year-on-year increase.
Asia-Pacific was the second region expected to see increasing inflation rate at 11.3% – up slightly from 11.1% in 2024.
The Middle East and Africa (MEA) may see net medical trend rates higher than last year at 7.6% in 2026 compared with 7.3% in 2025, but gross rates are projected to be slightly lower than last year due to cooling inflation – 15.3% in 2026 compared with 15.5% in 2025.
Finally, Latin America and the Caribbean (LAC) is projected to experience a slight decline in medical cost growth with a projected gross medical trend rate of 10.2% for 2026, down from the 10.7% forecasted in 2025.
Growing emphasis on prevention
Rachel Western, health and risk principal at Aon said: “The UK’s medical trend rate has dropped significantly in this year’s report, reflecting the impact of targeted cost containment strategies and a shift toward more sustainable benefit designs.
“Employers are increasingly utilising data analytics to drive targeted health strategies and wellness initiatives that manage and improve employee health risk.
“Musculoskeletal issues, cancer, and mental health continue to be the top cost drivers in the UK, but we’re seeing a growing emphasis on targeted prevention and early intervention.
“Organisations can reduce costs and support long-term workforce resilience by both addressing risk factors early in a targeted way and with a more preventative angle.”
Economic and geopolitical uncertainty
Kathryn Davis, global benefits vice-president at Aon, highlighted the current economic and geopolitical uncertainty, including global tariffs.
“While inflation is easing in some markets, healthcare costs continue to face significant pressure,” she said.
“This persistent rise in costs has become a widespread business challenge, prompting organisations to take proactive steps.
“By leveraging predictive analytics and adopting innovative cost management strategies, companies can better navigate ongoing volatility and strengthen their long-term benefits strategy.”
