More than a third of US employers saw health plan premiums rise 10 percent or more at their last renewal, even after making plan changes, according to data from Gallagher's 2026 Workforce Trends Report – Benefits Benchmarks. The survey drew on 3,717 US organizations polled from January to March.
The report's central finding is not about any single cost driver. It is about a broader shift in how employers are managing their health plans. Governance structures are tightening and vendor relationships face closer scrutiny.
Data is being applied more systematically, driven by pressure that shows little sign of letting up. Healthcare costs for employer-sponsored plans are set to rise between 6.5 and 9.5 percent in 2026, according to separate projections from Mercer, PwC, and Aon. That range represents the largest projected increase in roughly 15 years.
For employers that already adjusted plan designs, a 10 percent premium hike still landing at renewal signals the old math is no longer holding.
Specialty drugs have become the most closely watched line item in employer health plans. Almost half, 49 percent, of all employers surveyed cite the rising cost of specialty pharmaceuticals as a top challenge. GLP-1 therapies for obesity and diabetes treatment are frequently named as a significant contributor.
Scrutiny is shifting toward pharmacy benefit managers, or PBMs. Rather than raising employee cost-sharing, many employers are now examining PBM pricing, rebate arrangements, and formulary decisions more directly. The pressure has a regulatory dimension as well.
The Consolidated Appropriations Act, 2026, signed into law on February 3, requires PBMs to pass through 100 percent of rebates and related remuneration to ERISA-governed employer health plans. Most of those provisions take effect in 2029 for calendar-year plans, but the law's ERISA service-provider disclosure requirements are effective for contracts entered into or renewed on or after February 3. Separately, a January Department of Labor proposed rule would require PBMs to disclose all forms of compensation to self-insured employer plan sponsors. Federal officials estimate that change could save employers and workers $1 billion annually.
Those developments change the renewal conversation for benefits brokers. Under the new framework, employer plan sponsors have a heightened fiduciary obligation to evaluate whether their PBM arrangements are reasonable and defensible. The Consolidated Appropriations Act does not require employers to become pharmacy experts, but it places the expectation on them to work with their brokers and benefit partners to assess compliance.
"At a time when cost pressure is persistent and difficult to forecast, employers can't rely on periodic plan changes alone," said John Tournet, US CEO of Gallagher's Benefits & HR Consulting Division. "They're adopting a more disciplined approach built on stronger data, closer oversight and ongoing evaluation of plan performance."
Thirty-seven percent of employers in the Gallagher survey now use analytics to inform workforce planning and benefits decision-making. The figure reflects a shift away from annual plan reviews toward more continuous monitoring. Claims trends, vendor performance, and emerging cost concentrations are tracked across the plan year rather than only at renewal.
Wellbeing programs face similar scrutiny. Nearly one in four employers, 23 percent, report that fewer than 20 percent of eligible employees participate in their wellbeing initiatives. Low participation is prompting employers to question the value of standalone programs.
Many are looking to integrate health and financial wellbeing support more directly into day-to-day benefit access. A recent analysis of the broader benefits market found that employers chasing cost cuts risk reducing their brokers' role to quote comparison. That narrowing undercuts the advisory value a broker brings when helping clients work through plan design, vendor strategy, and workforce outcomes together.
As employers hold the line on core benefit costs, voluntary benefits are carrying more of the employee support load. Gallagher's data show that 72 percent of employers cite offering a more complete package as a primary reason for providing voluntary benefits. Sixty-six percent cite addressing coverage gaps, and 49 percent cite enhancing employee financial protection.
The specific benefits gaining ground are telling. Pet insurance is up 13 percentage points since 2023. Identity theft protection is up eight points. Employee perks and discount programs are up seven points.
Participation in voluntary benefits, however, remains a challenge in its own right. A March survey of 170 benefits brokers, conducted by the Employee Benefit Research Institute (EBRI) and Lincoln Financial, found that administrative complexity and education gaps are the primary barriers slowing voluntary benefit adoption. Brokers who can translate an expanding menu into clear, targeted enrollment guidance are better positioned to demonstrate value beyond coverage placement.
The Gallagher data land at a moment when the benefits broker's role is under pressure. Lockton's 2026 National Benefits Survey put cost reduction at the top of employer priorities, named by 54 percent of respondents. That is up from 38 percent in 2025, with talent attraction falling to 19 percent - behind cost for the second consecutive year, now by a much wider margin.
That shift can narrow the conversation. Employers investing in governance infrastructure, analytics, and PBM oversight are creating conditions where a broker's knowledge of vendor markets, claims analytics, and funding strategy matters. The ones who arrive at renewal already fluent in their clients' PBM data, claims trends, and fiduciary obligations are harder to replace with a quote comparison.
