| 9.8%Global medical trend rate 2026 (Aon) | $5.3TU.S. health spending 2024 — up 7.2% | 10%Projected employer cost increase (SHRM) | $700+Average group health cost per employee/month |
In the for-profit world, a 10% increase in employer healthcare costs is a significant budget event — but the machinery of response is available: prices can be raised, margins can be trimmed. In the nonprofit world, that flexibility does not exist. Revenue comes from grants with fixed amounts. Contracts rarely account for mid-cycle cost increases. And the employees who bear the direct burden are already earning below-market wages.
The Numbers Behind the Crisis
Aon’s Global Medical Trends Rates Report projects a global medical trend rate of 9.8% — the highest in recent memory. SHRM’s 2025 employer benefits survey found that 90% of HR professionals reported rising healthcare costs as their top organizational concern. U.S. health spending grew 7.2% in 2024, reaching $5.3 trillion. For nonprofits offering traditional group health insurance, these increases manifest in premium renewals arriving 8–12% higher, specialty drug costs rising, and utilization rebounds as employees return to deferred care.
For nonprofits, a 10% healthcare cost increase is not a budget line item to manage. It is a mission-delivery threat to navigate.
— Third Sector Benefits, 2026
Why Nonprofits Cannot Simply Absorb the Increase
| Cost Management Strategy | Private Sector Availability | Nonprofit Availability |
|---|---|---|
| Raise prices / increase revenue to offset costs | High — most businesses can adjust pricing | Very Low — grants are fixed; donations are unpredictable |
| Shift more cost to employees through higher deductibles | Moderate — feasible with competitive salaries | Very Low — additional cost-shifting accelerates departure |
| Reduce benefits to lower premium costs | Moderate — competitive employers resist but have the option | Very Low — many nonprofits already offer minimal benefits |
| Introduce telemedicine to reduce claims utilization | High — well-documented cost containment strategy | HIGH — available at under $20/person/month; highest ROI option |
| Invest in preventive care to reduce long-term claims | High — large employers invest in wellness programs | High — TSB nutrition and back care features provide preventive value |
What Cost-Conscious Nonprofits Are Doing in 2026
- Introducing subscription telemedicine as a first layer — addressing everyday healthcare needs that drive the majority of out-of-pocket costs for employees, at under $20/month
- Using telemedicine utilization data to demonstrate cost avoidance to their boards
- Making the case to funders that healthcare access for staff is a program delivery investment, not overhead
- Extending individual subscription access to part-time and contract workers excluded from traditional group plans
- Prioritizing preventive services — nutrition, back care, mental health — that reduce the likelihood of higher-cost healthcare events downstream
The Telemedicine Cost Containment Case — By the Numbers
Mechanism 1: Avoided Urgent Care and Emergency Room Costs
Approximately 70% of physician consultations involve conditions resolvable via telehealth. For a 20-person nonprofit at 35% utilization, with each active user averaging 2 relevant health events per year, the annual avoided cost exceeds $4,000 — against a $4,800 annual subscription investment.
Mechanism 2: Reduced Long-Term Claims Through Preventive Access
Teladoc’s outcomes research shows that subscribers engaged in virtual care programs average $1,500 lower annual healthcare claims than non-users. For organizations offering both TSB and group health insurance, reduced insurance claims from improved preventive care directly affect premium renewal calculations.
Mechanism 3: Retention Value That Offsets Subscription Cost
At under $20 per person per month, the full annual subscription cost for a 25-person organization is $6,000. If improved healthcare access prevents a single departure — conservatively valued at $22,000 — the subscription has delivered 367% ROI before any clinical benefit is considered.
Third Sector Benefits — Affordable Healthcare Access in a Rising Cost Environment
In a year when employer healthcare costs are rising nearly 10%, Third Sector Benefits offers the most cost-effective healthcare benefit available: six categories of Teladoc-powered virtual care for under $20 per person per month. No premium increases. No deductibles. No plan redesigns required.
For organizations currently offering no healthcare benefit, TSB delivers immediate value at a price that fits any operating budget. For organizations with existing group insurance, TSB reduces the utilization of expensive in-network services for everyday conditions.
In a rising cost environment, TSB is the most affordable move available. Visit thirdsectorbenefits.com or contact Eric Snyder at eric@thirdsectorbenefits.com.
