Employers across the country continue to feel the pressure of rising health care costs, and 2026 is shaping up to be another challenging year. A growing pipeline of high-cost drugs, expanding chronic disease rates, and an aging workforce are all converging to create a perfect storm for employer-sponsored plans.
Let’s take a closer look at some of the biggest factors expected to influence health plan spending in the year ahead and what employers should keep on their radar.
GLP-1s Continue to Disrupt the Market
It’s important to note that additional GLP-1 drugs are expected to hit the market by 2026, and with them, even more cost implications for employers. Following the commercial success of drugs like semaglutide and tirzepatide, pharmaceutical companies are racing to bring similar obesity and diabetes medications to market.
More than 100 GLP-1 related drugs are currently in clinical development for obesity alone. While these medications offer life-changing benefits for many patients, their high price tags and growing demand have made them a major cost driver for employer-sponsored plans.
Specialty Medications: The Fastest Growing Cost Driver
Concerns around pharmacy trends are nothing new, but they continue to intensify. Specialty medications, high-cost drugs used to treat complex or rare conditions, now account for the vast majority of new FDA approvals, representing nearly 80% of all new drugs approved in 2025.
This rapid growth is being fueled by increased utilization and groundbreaking innovation in three key areas:
1. Biologics and Biosimilars
Biologics remain dominant in the specialty market, offering targeted treatments for autoimmune diseases, cancers, and more. Meanwhile, biosimilars, more affordable alternatives, are gaining traction as major biologics lose exclusivity.
The FDA approved 19 new biosimilars in 2024, a record number, followed by 10 more approvals in 2025. Experts predict this momentum will continue, with at least 10 new biosimilars entering the market each year over the next five years.
For employers, this trend represents both a challenge and an opportunity. While new therapies increase costs, biosimilars offer potential savings when included strategically in formulary design.
2. Cell and Gene Therapies (CGT)
Cell and gene therapies (CGTs) are transforming the treatment landscape for cancers and rare genetic conditions. Several first in class therapies are expected to reach the market in 2025, bringing life-changing outcomes but also steep prices and logistical hurdles.
Manufacturing remains a key bottleneck. Traditional infrastructure is not suited for small-batch, personalized treatments, but new automation and analytical technologies are helping improve scalability and reduce costs. Still, the complexity of administering and monitoring these therapies adds to the overall burden for health plans.
The takeaway? Specialty drugs will continue to be a major driver of health care inflation in 2026, with employers needing to stay proactive in managing utilization and exploring cost-control strategies.
Chronic Conditions Continue to Drive Costs
According to the CDC, about 90% of all U.S. health care spending is related to individuals with chronic or mental health conditions. Common culprits include heart disease, stroke, cancer, diabetes, arthritis, and obesity, many of which overlap in the same individuals.
Cardiovascular Disease
The American Heart Association projects that by 2050, more than 60% of older adults will be affected by heart disease or stroke, driving $1.8 trillion in annual costs. After adjusting for inflation, that’s a threefold increase compared to today’s levels.
Obesity
Obesity remains one of the most pervasive and costly health issues in the U.S. The CDC reports that more than 2 in 5 adults meet the definition of obesity (BMI of 30 or higher), contributing to related conditions such as Type 2 diabetes, heart disease, and sleep apnea. Annual obesity-related medical costs are estimated at $173 billion.
As the prevalence of chronic disease continues to rise, employers may see increased medical and pharmacy utilization, underscoring the importance of prevention, early intervention, and wellness initiatives.
Aging Populations: A Long-Term Pressure Point
While life expectancy continues to rise, U.S. birth rates have steadily declined. According to the Congressional Budget Office, life expectancy at birth is expected to climb from 78.9 years in 2025 to 82.3 years by 2055. Meanwhile, the CDC reports that birth rates in 2024 reached a record low, averaging fewer than 1.6 children per woman.
The result is a steadily aging population, one that is more likely to require ongoing medical care and complex treatments. For employers, this demographic shift signals higher long-term costs and greater demand for chronic condition management.
Final Thoughts
Between the rise of GLP 1s, rapid expansion of specialty medications, and the growing burden of chronic disease, employers face a challenging health care landscape in 2026. Staying informed and working closely with advisors to evaluate plan design, manage pharmacy benefits, and promote employee wellness will be essential to controlling costs and maintaining a sustainable benefits strategy.
At McConkey, we help organizations anticipate change, plan strategically, and take action. If you’d like to explore strategies to manage pharmacy trends or strengthen your health plan, connect with our team today.
