SYDNEY, 14 Oct. 2026 - Aon plc (NYSE: AON), a leading global professional services firm, forecasts that Australian medical plan costs will increase by 4.9% in 2027, according to its latest 2027 Global Medical Trend Rates Report. While slightly lower than the projected 5.2% increase in 2026, healthcare costs are expected to continue outpacing inflation, creating ongoing challenges for employers managing workforce health and benefits costs.

Australia's projected medical trend rate of 4.9% remains below both the Asia Pacific average of 9.7% and the global average of 9%. Medical plan costs are projected to increase 1.7 percentage points faster than inflation in 2027, highlighting the need for employers to balance affordability with access to care.

“While the projected rate of increase has moderated slightly, employers still face difficult decisions around balancing costs with access to quality care,” said Stuart Whitbread, Director, Health and Benefits, Australia, Aon. “Organisations that take a long-term approach to workforce health will be better positioned to manage costs while supporting employee wellbeing and productivity.”

The report found that chronic health conditions remain a key driver of healthcare costs globally. Cardiovascular disease remains the leading healthcare cost driver worldwide, while cancer is a significant contributor to medical plan costs in Australia.

“Cancer continues to drive healthcare costs not only because of its prevalence, but also because of advances in treatment and growing demand for specialist care. While these developments are positive for patient outcomes, they are also increasing the cost of care for employers and insurers,” added Whitbread. “This highlights the opportunity for employers to invest in prevention, early intervention and workforce health strategies that support better outcomes for employees while helping manage longterm costs.”

Globally, average medical plan costs are forecast to increase by 9% in 2027, down from 9.8% in 2026. Across Asia Pacific, medical trend rates are expected to decline from 11.3% to 9.7%, though healthcare costs are expected to rise across the region.

As healthcare costs continue to outpace inflation, Australian employers face growing pressure to balance cost management with employee expectations around access to quality healthcare. Organisations that invest in workforce health and wellbeing can help strengthen employee outcomes while building greater confidence in their long-term benefits strategy.

Read Aon's 2027 Global Medical Trend Rates Report here.

About Aon

Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that help protect and grow their businesses.

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