Win, Win, Win: Reduce Liability, Improve Health and Increase Profits

The article, CFOs And HR Execs Facing Millions In Personal Liability Due To Unmanaged Health Benefits Plans, from Forbes touches on two very hot topics right now; increasing lawsuits over fiduciary responsibility and new methods of improving upon health benefits plans for both the employer and the participating employees.  Here are the main takeaways that HR Directors, CFOs and Boards of Directors need to be thinking about:

  • Frequency and severity of lawsuits over lack of fiduciary responsibility of health plan sponsors is increasing.  We’ve seen it before with 401(k)’s, 403(b)’s lawsuits ticked up earlier this year and now the trends show that employee health plans could be next.
  • Company plan sponsors and management assume that their benefits brokers are acting in their best interest and their employees.  A lot has changed with health insurance over the last 5 yrs. and simply brokering a fully insured health plan between carriers or changing metrics such as deductibles and HSA like contributions is no longer sufficient to meet fiduciary standards.  Organizations need to look hard at the services they are getting from their broker and what services are being offered by more engaged benefits consultants.  Instituting a regular RFP process to survey the market is good practice and a good form of protection from a fiduciary standpoint.
  • In short, the answer to reducing employee benefits fiduciary liability is to ensure your benefits consultant / TPA is well versed and employing the most effective cost containment strategies for your benefits program.  This often means keeping your health insurance carrier’s provider network but having your consultant act as TPA for the plan, self-insuring, joining a captive or most commonly, a combination of the 3.  To learn a little more about these solutions, check out my recent LinkedIn posting.

RCM&D consistently helps employers with over 50 insured lives to meet required fiduciary standards and maximize the care of their employees at significantly lower costs.  Feel free contact me at wskene@rcmd.com or 484.581.2813 if you have questions or would like to learn more about how we can help your organization.