Employer-sponsored medical benefits costs in Hong Kong are projected to climb by 9.9% in 2026, forcing companies to reconsider benefits strategies amid sustained global health care inflation. This forecast, stemming from WTW’s 2026 Global Medical Trends Survey, indicates continuous upward pressure on corporate healthcare spending, driven by technological advancements, pharmaceutical innovations, and escalating demand for outpatient services.
The survey, which canvassed 346 leading health insurers across 82 countries in mid-2025, revealed that insurers globally anticipate an average medical cost increase of 10.3% next year. The Asia-Pacific region is set to experience the steepest rise at 14%. While Hong Kong’s projected 9.9% increase is 0.2 percentage points higher than 2025, it remains below both the regional and worldwide averages.
Persistent Drivers of Healthcare Inflation
Experts at WTW attribute the relentless cost acceleration to several structural factors, signaling that elevated medical inflation is likely to persist beyond three years. The primary culprits globally are the integration of expensive new medical technologies, pharmaceutical advances, and strong consumer demand for outpatient treatments and medications.
In the Asia-Pacific context, 77% of surveyed insurers pinpoint new medical technologies as the chief cost accelerator. This pressure is compounded by pharmaceutical innovation and limited cost-sharing arrangements within many existing plans.
The largest individual contributor to rising claims costs, both globally and throughout Asia-Pacific, remains cancer. Oncology is identified by 58% of regional insurers as the fastest-growing and most expensive diagnostic category. Alarmingly, specialists report a continuing increase in cancer incidence among individuals under the age of 40. Following cancer, cardiovascular disease ranks second in cost contribution, ahead of musculoskeletal conditions and diabetes.
Local Factors and Employer Response
Hong Kong’s elevated medical inflation is particularly sensitive to the increasing adoption of highly advanced treatments and novel medications. The anticipated increase in public hospital fees, scheduled for January 2026, is expected to prompt corresponding adjustments in the private sector. Furthermore, the city has experienced high post-pandemic prevalence of respiratory infections and increased demand for routine dermatological treatments. Although overall cancer incidence appears stable locally, the cost of treatment has risen significantly due to higher facility fees and the uptake of sophisticated therapies such as biological and immunotherapies.
In response to these financial pressures, employers and insurers are actively restructuring benefits design and delivery. Many plans now incorporate preventive and management services, including specific care pathways, rehabilitation support, case management, and second medical opinion programs. These measures aim to guide appropriate treatment decisions and moderate claims growth.
Lam Chun-ho, WTW’s Health & Benefits lead for Hong Kong and Macau, advises local employers to take proactive steps:
- Invest in education and preventive care.
- Introduce flexibility within benefits plans.
- Implement cost-sharing mechanisms like co-pay or coinsurance to encourage prudent utilization of services.
Evolving Employee Demands
Despite the drive for cost containment, employee demand for enhanced, specialized benefits is expanding. Insurers report increased employer interest in covering fertility and reproductive health services, such as IVF and egg freezing, alongside expanded mental health support services. Organizations are also prioritizing richer optical and dental coverage, comprehensive preventive screenings, genetic testing for risk assessment, and gender-affirming care.
The modernization of benefits is accelerating through the expansion of telemedicine, automation of plan administration, and the integration of highly specialized treatments like robotic surgery into standard medical plans.
Ultimately, the findings underscore a critical challenge for multinational employers in Hong Kong: navigating sustained medical inflation requires disciplined program management, proactive financial planning, and targeted interventions focusing on prevention, mental health, and optimized cancer care pathways.