Employer Health Costs Are Set to Spike in 2026. Here's What Healthcare Leaders Should Do Now
In 2026, employer healthcare costs are expected to see their largest increase in 15 years. That pressure lands hardest on small businesses and the teams that support them-brokers, plan admins, network partners, and providers.
At the same time, AI is changing how benefits are built and administered. The question isn't if technology will shift cost curves-it's who gets access, who benefits, and who gets left behind.
Access Is Uneven-And SMBs Feel It Most
Ty Wang, CEO and cofounder of Angle Health, put it plainly: there's been "an explosion of new ways of receiving medical services" like telehealth, digital pharmacies, and chronic disease programs. But those advantages skew to large tech and white-collar employers. "These services are still largely inaccessible to the vast majority of Americans," he said.
Small businesses often face weak broker support, limited transparency, and little bargaining power. There's "very little predictability," Wang added, and incumbents "gatekeep the data that's available to them."
An AI-First Playbook for Benefits Operations
Angle Health, cofounded in 2019 by Wang and fellow Palantir alum Anirban Gangopadhyay, says it now serves more than 2,600 small business employers across 44 states and has raised a $134 million Series B in equity and debt. The bet: automate the work that shouldn't be manual.
"We quote thousands of groups a week," said Gangopadhyay. Traditional carriers ship 12-20 page PDFs and parse them by hand. "We've fully automated and optimized that process where our underwriters and our sales people are only doing the pieces that we need a human to be doing."
What This Means for Healthcare Professionals
- Payers and TPAs: Expect tighter quoting cycles, more demand for real-time reporting, and pressure to hold renewals steady. Automate ingestion of broker census files, plan comparisons, and rate builds. Keep humans on exceptions, negotiations, and compliance.
- Providers and RCM leaders: Plan for benefit designs that steer to virtual care, narrow networks, and bundled episodes. Strengthen eligibility checks, prior auth automation, and price estimates to reduce denials and bad debt.
- Brokers and benefits admins: Push for month-over-month cost and utilization reporting-not just renewal binders. Ask for API access, clear fee schedules, and service-level metrics. Prioritize vendors that can prove impact on high-cost claimants.
Practical Moves for the Next 12 Months
- Standardize data flows: eligibility, claims, and pharmacy feeds on a predictable cadence. Insist on machine-readable plan docs and rate files.
- Target high-cost drivers: diabetes, MSK, cardiometabolic, oncology. Pair virtual specialty care with outcomes guarantees.
- Tighten steerage: high-value networks, centers of excellence, and price-transparent facilities. Educate members on site-of-care options.
- Audit dependents and spousal carve-outs where appropriate. Small tweaks compound when trend is rising.
- Make quoting and renewal reviews weekly rituals during Q3-Q4, not a last-minute scramble.
Transparency Isn't Optional Anymore
Hospitals and plans face growing pressure to expose rates and shoppable services. Use that data to validate steerage and contracting assumptions, not just to check a compliance box.
Guardrails for AI in Benefits and Care
- Keep a human in the loop for underwriting outliers, clinical triage, and appeals.
- Document data lineage. If a quote or decision is challenged, you need an audit trail.
- Measure bias. Compare outcomes across demographics and adjust models when drift appears.
- Privacy first: minimum necessary data, encrypted at rest/in transit, and strict role-based access.
The Bigger Picture
Wang and Gangopadhyay point to a systemic issue that tech can improve over time: fragmented data, manual workflows, and cost surprises. "We don't believe that an insurance company is going to really solve healthcare," said Gangopadhyay. "We think that the future of healthcare is a completely redesigned ecosystem that is using AI-first, tech-first products and workflows to really unlock the best care for members."
That future won't arrive evenly. Healthcare leaders who build simple, repeatable systems-clear data, fast feedback loops, and targeted interventions-will blunt the 2026 spike and set a new baseline for cost and experience.
If You're Building Team Skills
If you're responsible for rolling out AI-driven workflows across benefits or care operations, upskilling your team matters more than tools. Curated training by role can shorten the learning curve.
The signal is clear: automate the busywork, expose the data, and put people where judgment changes outcomes. Do that, and rising trend becomes manageable instead of overwhelming.
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