Middle East healthcare costs to surge again in 2026, forecasts WTW report

Global health insurance costs are projected to rise again by double-digits next year, on the back of a growing number of chronic diseases, an ageing population, and investments in new technologies. That is according to a global study by WTW.

The ‘Global Medical Trends’ study from WTW surveyed around 350 health insurers from 80+ countries to gain a clear view of trends and developments in the landscape.

The survey of health insurers found that the average cost of medical health benefits will increase by 10.3% globally next year. This follows rises of 10% in 2025 and 9.5% in 2024.

Regionally, the highest cost increases are expected in Asia Pacific at 14% while Latin America is anticipating the sharpest acceleration in costs, from 10.5% this year to 11.9% expected in 2026.

The picture in the Middle East is not much different, with average healthcare costs expected to increase by 11.3% in 2026, up from 10.3% in 2025 and 8.5% in 2024.

According to WTW, the hikes are the result of a number of pressures:

• Fraud, waste and abuse are the leading cost drivers, cited by 79% of insurers, significantly higher than other regions.
• New medical technologies (59%), provider consolidation (48%) and supply chain disruptions (46%) are also major contributors to rising costs.
• Diabetes is the top condition by both utilization and cost driving inflation of medical costs, with 82% of insurer identifying it as the leading driver of claims.
• Cancer remains a fast-growing and expensive diagnosis contributing to claims (66% by utilization, 76% by cost).The report also highlights the increased prevalence of cancer in the under-40 year old population.
• GLP-1 medications for obesity are still excluded from the majority of standard insurance programs in the region, however the report shows that insurers expect utilization and cost will rise.
• Behavioral health coverage remains limited, with only 30% of insurer currently offering it, though 37% plan to expand coverage in the next three years.

Steve Clements, Senior Director at WTW, said: “Despite variations in healthcare provision in different countries and regions around the world, rising medical costs are a consistent trend for all.”

From a disease-based perspective, cancer is the leading condition driving medical costs globally. It is named as the fastest growing and most expensive diagnosis for insurers in nearly every region, cited by 57% of insurers globally. Three-quarters (75%) of insurers also observed an increase in cancer incidence among individuals under the age of 40.

Cardiovascular conditions (50%) are also growing significantly and rank second among the conditions driving medical claims costs, with behavioural health issues (37%) ranked third.

What employers can do

Employers in the Middle East are urged by the researchers to adopt innovative cost management strategies, expand preventive care and address the growing burden of chronic and lifestyle-related diseases.

Respondents in the region said that cost-sharing, reviewing the eligible provider network and putting in place pre-approval limits are effective cost management tools to curb cost pressures.

Dina Suleiman, Director at WTW in Saudi Arabia, highlighted that employers will need to take a strategic approach if they want to managing healthcare inflation in an effective manner. “This includes educating employees on how to use their health benefits effectively, promoting preventive programmes for high impact conditions such as cancer and cardiovascular disease, optimising mental health support, and introducing flexible benefit options to meet diverse workforce needs.”

“By implementing these measures, employers can enhance the value of their healthcare programmes while mitigating the impact of rising medical costs across the region.”

Technology the bright side?

On the bright side, the WTW report said that while several cost pressures have a structural nature, like the prevalence of diseases and an ageing population, AI offers a glimmer of hope. “Investment in technologies, including AI, is leading to higher costs at the moment but following this phase new technologies are expected to reduce healthcare cost trends in the longer term,” said Suleiman.