Family health premiums are approaching $27,000 a year—and for many Indiana employers, that number keeps climbing. UnitedHealthcare’s 2026 Health Trends Report gives us a detailed look at what actually drove health care costs in 2025 and what to expect for Indiana Group Health Insurance heading into 2026.
The report is based on real insurance claims from November 2024 through October 2025. I also compared it with four other major national studies—from PwC, Mercer, Business Group on Health, and KFF. The findings line up closely across all of them.
Costs Are Rising—and Faster Than Before
The bottom line is simple: health care spending jumped in 2025. The biggest culprits were hospital costs, very large claims (those over $100,000), and expensive specialty drugs.
Large claims alone rose 12.9% from the prior year. Pharmacy costs went up 11%—and similar increases are expected in 2026. Specialty drugs now make up about 55% of total pharmacy spending, even though they account for less than 2% of all prescriptions written.
Here’s what national data shows for 2026:
- PwC projects an 8.5% increase in medical costs for employer health plans.
- Mercer reports a 6.0% per-employee cost increase in 2025, projecting 6.7% for 2026—the highest in 15 years.
- Business Group on Health projects a 9% trend for 2026, which smart plan changes can reduce to 7.6%.
- KFF found that average family premiums rose 6% in 2025, reaching nearly $27,000.
The message is consistent: health care costs keep outpacing inflation and wage growth, with no sign of slowing down.
The Conditions Driving the Most Spend in Indiana Group Health Insurance
UHC breaks down cost increases by medical condition. Here’s what’s rising fastest in terms of year-over-year increase:
- Maternity (incl. NICU) – 11.7%
- Mental health – 10.9%
- Digestive disorders – 10.5%
- Circulatory (CVD) – 9.4%
- Nervous system – 9.2%
- Musculoskeletal – 9.0%
- Cancer – 8.2%
Three areas deserve special attention for Indiana employers:
Mental health (up 10.9%): Mental health costs have jumped 117% since 2019. If you haven’t taken a close look at your behavioral health benefits lately, you may be overpaying—and your employees may be underserved.
Maternity and NICU costs (up 11.7%): High-risk pregnancies and premature births are pushing costs higher. For employers with younger workers, this is often a bigger cost driver than people realize.
Digestive disorders (up 10.5%): These costs are rising due to obesity, more diagnostic testing, and side effects from GLP-1 medications (drugs like Ozempic and Wegovy). Expect this trend to continue as these medications become more common.
How Employees are Using Care
After the pandemic, more people are going back to in-person care. ER visits went up 2.1%, while virtual care dropped 16.1%. Gen Z workers are especially likely to use the ER instead of seeing a primary care doctor—a pattern that tends to cost more and do less for long-term health.
On the positive side, digital tools—like health plan apps and online care finders—are being used for 72% of member interactions. People who use these tools regularly make smarter care choices and tend to have lower overall costs.
Who’s Driving Costs in Your Workforce?
Baby Boomers still have the highest costs per person, but Gen X and Millennials—who make up most of today’s workforces—are responsible for a growing share of the increases. One factor many employers overlook: spouses covered on employer plans cost 36% more per person than employees themselves, often because they’re older and use more planned medical services. If your plan covers a lot of dependents, that’s worth a closer look.
What Employers Are Doing About Indiana Group Health Insurance
Employers are moving away from relying only on high-deductible health plans. Instead, they’re trying smarter, more employee-friendly approaches. UHC highlights growing use of:
- Copay-driven plan designs (such as Surest®) that make costs more predictable for employees.
- Centers of Excellence for serious conditions like cancer or complex surgery, which can lower costs and improve outcomes.
- Preventive drug lists that encourage employees to take medications before conditions get worse.
- Care navigation tools that help employees find the right doctor or facility at the right cost.
At Nefouse & Associates, we’re seeing Indianapolis-area employers take a hard look at all of these options—especially plan redesign and pharmacy management, where there’s often real money to be saved without cutting the quality of coverage.
What This Means for Your Indiana Group Health Insurance Plan
Data is helpful, but it doesn’t lower your renewal on its own. What matters is how you apply it to your specific workforce, your employee mix, and your budget.
As claims keep rising, Indiana employers and their employees will feel the pressure through double-digit premium increases. The employers who handle this best are the ones who pay attention to changes in their workforce and take action before renewal season hits.
Here are three situations where acting sooner—rather than later—can make a real difference:
Your workforce demographics are shifting. If older employees are retiring and younger ones are being hired, that’s the right time to re-examine your health plan. A plan built for one group of employees may not be the best fit for another. These transitions create a natural opening to make changes that employees will welcome.
You have a small number of very high-cost claimants. When a few individuals are driving most of your claims, it may be time to explore the Individual Coverage Health Reimbursement Account (ICHRA). With an ICHRA, employers give employees a set amount of money to buy their own individual health coverage. This can provide meaningful cost relief while still giving employees flexibility in how they get covered.
The market creates a new opportunity. Indiana small employers should be ready to pivot when the right option comes along. There are more plan choices today than ever before—but you have to know what to look for and be willing to move when the timing is right. That’s exactly where a trusted advisor makes a difference.
Request a Complimentary 2026 Trend Review
If your company is coming up on a 2026 or 2027 renewal, I’d welcome the chance to review how these trends may be affecting your specific Indiana Group Health Insurance plan. There’s no cost and no obligation—just a clearer picture of where your benefits program stands and where the real opportunities are.
Reach out to our team in Indianapolis to get started.