As employers finalize budgets for 2026, one number stands out: healthcare costs are projected to rise 8.4% next year. That means an additional $1,300 per employee in annual medical and prescription expenses. For a company with 200 employees, that’s more than $260,000 in added costs.
At VertiSource HR, we believe this challenge is also an opportunity, if approached strategically.
Why Healthcare Costs Are Rising in 2026
- Specialty drugs such as GLP-1 therapies for diabetes and weight management
- Increasing utilization of care for chronic conditions and mental health
- Provider wage inflation and staffing shortages across healthcare networks
The Stakes for Employers
- Higher contributions reduce employee morale and engagement
- Turnover costs can reach 50% to 400% of an employee’s annual salary
- Productivity loss rises as untreated conditions worsen
- Budget volatility disrupts financial planning and cash flow
Proven Strategies for Cost Containment
Smarter Plan Design
- Self-funded and level-funded models
- Reference-based pricing to control out-of-network costs
- Transparent PBM contracts with no hidden fees
- Vendor consolidation for integration and negotiation power
Employee Engagement & HR Communication
- Benefits education and decision-support tools
- Early, clear communication about plan changes
- Telehealth, health coaching, and preventive care support
Alternative Models
PEO partnerships offer small and mid-sized employers access to more competitive benefits. Pooling employees creates cost stability and enhances recruiting and retention efforts.
The VertiSource HR Advantage
We help employers balance cost containment with employee support through:
- Data-driven claims analysis
- Multi-year cost roadmaps
- Customized employee communication strategies
- Vendor and broker alignment
Quick Wins for 2026 Planning
- Identify whether prescription drugs or medical claims are your top cost drivers
- Reassess PBM and carrier contracts now for savings opportunities
- Communicate upcoming benefit changes early to avoid surprises
Final Takeaway
The 8.4% cost surge ahead is a challenge, but also a chance to rethink your benefits strategy. Organizations that succeed will align Finance and HR, act on claims data, and engage employees proactively.
Schedule your free healthcare cost-containment assessment with VertiSource HR today. Together, we’ll protect both your people and your bottom line.
