Innovation and Disruption
For a self-funded employer, fiduciary integrity is not just an ethical ideal—it is a legal mandate with significant personal and corporate consequences. Under the Employee Retirement Income Security Act of 1974 (ERISA) and the more recent Consolidated Appropriations Act (CAA), employers who self-fund their health plans are legally classified as “fiduciaries.” This means they are managing someone else’s money (the employees’ contributions and the company’s assets) and are held to the highest standard of care under the law.
Why do innovation and disruption matter?
Passive benefit management, using traditional contracts, has resulted in unsustainable inflation.
115%
Since 2006, the average premium for employer-sponsored family coverage has risen by approximately 115% to 125%.
130%
The amount employees pay out of their own paychecks for that coverage has surged by over 130% in the same period, as employers have been forced to shift more of the cost burden.
60% – 70%
While premiums doubled, worker earnings grew by only about 60% to 70% over those 20 years.
The Savings
Employers who implement high-value delivery models (like direct contracting or advanced primary care) expect to lower that trend to 7.6%, by driving to high performing COE providers that reduce complications, avoid unnecessary care, and save by bundling expenses.
Direct contracting also contributes to better use and visibility of the provider cost and quality data.
Value Happens When Employers Work Together
Your voice is important. Combined with other employers, it is unstoppable.