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Employers shift 2026 benefits renewals toward cost-cutting
Lockton’s 2026 survey of 1,705 plan sponsors found the share of employers prioritizing cost reduction rose to 54% from 38% in 2025, reshaping what brokers are asked to do.
Employers’ focus for the 2026 benefits renewal cycle is shifting, with Lockton’s 2026 National Benefits Survey indicating cost reduction has become the top priority for many plan sponsors, changing how benefits brokers are positioned in renewal meetings. Lockton said 54% of the 1,705 plan sponsors surveyed now rank cost reduction as their top benefits priority, up from 38% in 2025, while attracting and retaining talent has slipped behind for the first time in years, according to Insurance Business.
The survey also suggests clients are willing to explore more aggressive levers to lower pharmacy spend. Insurance Business reported that 46% of self-funded plan sponsors said they would consider international drug sourcing for pharmacy benefits, which the article frames as a sign of how far employers are willing to go when cost becomes the main focus.
As premium increases and rising costs intensify the pressure, the broker relationship can move from strategy to price comparison, with more work that is easier to benchmark and replicate, the outlet said. Insurance Business cited insurer and consultancy data showing average annual premiums for family coverage nearly $27,000 in 2025, up 6% year over year, and Mercer projections that employer healthcare costs will rise 6.7% in 2026 to above $18,500 per employee.
The article argues that this cost-first approach can leave gaps in areas brokers may be best able to address, even as employers underinvest in factors tied to absenteeism, turnover, and productivity. Insurance Business pointed to Value in Health research that 23% of employed family caregivers of older adults reported absenteeism or reduced productivity, and it cited Prudential Financial research showing a mismatch between employer and employee views on support for medical cost management.