The average American covered by an employer health plan is projected to spend $8,460 on healthcare this year, up from $7,838 in 2025, according to Milliman’s 2026 Medical Index released May 20.
The index captures both employer and employee cost share and is not drawn from a specific population.
Five things to know:
1. The 7.9% jump marks the sharpest annual increase in more than a decade, excluding pandemic-era fluctuations.
2. Milliman estimates total annual costs for a hypothetical family of four on a typical employer plan will reach $37,824, up 7.2% from a restated 2025 figure of $35,281.
3. Prescription drug and outpatient services are together responsible for roughly 69% of this year’s cost growth. Pharmacy is the fastest-rising category, up nearly 15% per person, with GLP-1 medications for diabetes and weight management playing an increasingly significant role in employer drug spend.
4. Outpatient care now makes up about 31% of total employer-sponsored spending and has grown more than 300% in cost for a family of four over the past two decades. Contributing factors include more physician practices operating under hospital ownership, a long-running migration of care from inpatient to outpatient settings and rising use of high-cost specialty drugs administered in outpatient facilities.
5. Employers are absorbing a shrinking share of the total bill. Milliman’s data shows the employer portion of healthcare costs has declined from 61% to 58% since 2005, while the employee share of premiums has climbed from 21% to 27% over the same period.
Becker’s 3rd Annual Fall Chief Pharmacy Officer Summit is the top tier event that the people leading the future of pharmacy convene. This 3-day event is built specifically for Chief Pharmacy Officers and senior pharmacy leaders. The sessions examine the workforce, financial and clinical priorities shaping pharmacy today. Becker’s is where candid discussions flourish and new ideas thrive. Becker's 3rd Annual Fall Chief Pharmacy Officer Summit
