Healthcare costs in Kenya are projected to continue rising in 2026 despite ongoing government efforts to expand access and affordability through the Social Health Insurance Fund (SHIF), according to a new global healthcare trends report by consulting firm Aon.

The 2026 Global Medical Trend Rates Report projects that medical costs in Kenya will increase by 13.5 per cent in 2026, up from 13 per cent in 2025, underscoring persistent inflationary pressures within the healthcare sector.

The report comes at a time when the government is accelerating the implementation of SHIF, which replaced the National Health Insurance Fund (NHIF) and is expected to play a central role in delivering Universal Health Coverage (UHC).

However, the findings suggest that structural cost drivers in healthcare may continue to push up medical expenses for employers, insurers and households.

Aon defines medical trend as the projected annual increase in the cost of treating patients and providing healthcare services. The trend is influenced by factors such as inflation, healthcare utilisation, prescription drug costs and advancements in medical technology.

According to the report, Kenya’s projected medical inflation remains significantly above the country’s general inflation rate of 4.9 per cent in 2026, resulting in a net medical trend of 8.6 per cent.

The findings mirror broader trends across Africa and the Middle East, where healthcare systems continue to face mounting pressures.

“Countries expecting higher medical costs are largely being driven by increased demand for healthcare services, dependence on imports combined with currency depreciation, and chronic disease burden,” the study reads.

The report projects the Middle East and Africa region will record an average medical trend rate of 15.3 per cent in 2026, among the highest globally.

While inflation across the region is cooling, healthcare costs continue to outpace broader economic trends.

Aon said healthcare inflation worldwide remains elevated due to higher utilisation of medical services, adoption of advanced technologies and growing demand for private healthcare. Ageing populations are also contributing to higher costs in many markets.

For Kenya, the rising cost outlook could present a challenge for SHIF implementation as the government seeks to improve healthcare access while containing expenditure.

The transition to SHIF is intended to reduce out-of-pocket spending and pool healthcare risks more effectively, but increasing treatment costs may place pressure on both public financing and private medical schemes.

The report also identified the leading health conditions expected to drive healthcare spending globally in 2026. Cardiovascular diseases remain the biggest cost driver, followed by cancer, hypertension and diabetes.

Notably, hypertension was highlighted as both a major medical condition and the leading risk factor for several other illnesses. Physical inactivity, poor nutrition and obesity were also cited among the top contributors to rising healthcare costs.

The healthcare inflation

Prescription drug spending is emerging as another major source of healthcare inflation. Aon noted that newer treatments, particularly GLP-1 medications used for diabetes and weight management, are increasing costs in several markets.

“Numerous countries in regions around the world are already reporting that, on average, 10 per cent of the medical trend rate can be attributed to GLP-1s and similar drugs, with this amount as high as 25 per cent in some markets,” the report said.

As healthcare costs continue to climb, employers globally are increasingly focused on cost-containment measures.

According to Aon’s findings, 70 per cent of companies now rank cost management as their top benefits priority, with many negotiating harder with insurers, expanding wellbeing programmes and introducing flexible benefit plans.

The report noted that wellbeing initiatives remain the most common strategy for managing healthcare costs, with 86 per cent of countries surveyed identifying them as a key mitigation measure. Such programmes encourage preventive care and healthier lifestyles, helping reduce the need for more expensive treatment later.

While Kenya’s healthcare reforms aim to improve affordability and coverage, the Aon report indicates that rising medical inflation, growing demand for services and the increasing burden of chronic diseases will remain significant challenges in the coming years, potentially testing the sustainability of healthcare financing under the SHIF era.