PLANSPONSOR Roadmap: Health Benefit Fiduciary Duties—CAA Deep Dive

By Emily Boyle – As health benefit plan sponsors work to understand their fiduciary obligations under the Consolidated Appropriations Act of 2021 and refine their processes to meet them, fiduciary frameworks developed for retirement plans can serve as valuable models, according to speakers from the first session of the 2026 PLANSPONSOR Roadmap: Health Benefit Fiduciary Duties livestream series. The CAA has triggered litigation, underscoring the importance of diligent oversight. Experts speaking at the April 8 session shared that plan sponsors must pay close attention both to any fees they are paying to providers or consultants, and to their contracts with pharmacy benefit managers and other vendors. Read Full Article...

HVBA Article Summary

1. Expansion of Disclosure Requirements: The Consolidated Appropriations Act (CAA) of 2026 broadened the scope of compensation disclosure to include any covered health service provider expecting to earn at least $1,000 from a benefit plan governed by ERISA. This expansion builds upon the CAA of 2021, which initially targeted brokers and consultants, and now aims to provide plan sponsors with greater transparency regarding service provider fees. Enhanced disclosure is intended to help fiduciaries make more informed decisions and fulfill their duties to plan participants.

2. Importance of Prudent Oversight and Vendor Monitoring: Speakers emphasized that health plan sponsors are ultimately responsible for fiduciary decisions and cannot delegate away key responsibilities such as vendor selection and monitoring. Ongoing payment integrity reviews and careful contract negotiations are essential practices to ensure that fees are reasonable and services are delivered as promised. Documenting corrective actions taken in response to errors demonstrates a commitment to acting in the best interests of plan participants.

3. Litigation and Regulatory Developments: Recent court cases, including the Supreme Court’s 2025 Cunningham v. Cornell decision and ongoing litigation against Northwestern University, highlight the legal risks associated with alleged fiduciary breaches and prohibited transactions. The Department of Labor’s proposed rule would require more detailed compensation reporting from pharmacy benefit managers, particularly for plans with over 100 employees. Regulatory trends are moving toward clearer definitions of unreasonable fees and stricter pass-through requirements for rebates, increasing the compliance burden on plan sponsors.

Researchers say insurers 'tunneled' 5% of profits to pharmacy affiliates

By Allison Bell – Big U.S. health insurers are using pharmacy affiliates to get around the Affordable Care Act minimum medical loss ratio requirement, or profitability cap, a team of economists says. When a health insurer affected by the ACA minimum MLR requirement is close to earning too much money, it has the pharmacy affiliate increase prescription drug prices, the economists write in a new working paper. The insurer uses that strategy to transfer extra profits to the pharmacy affiliate, comply with the minimum MLR requirement for health insurers, and maximize the "conglomerate firm's" total profits, the researchers say. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Circumventing Profit Regulations: The article highlights how major U.S. health insurers have used their affiliated pharmacies to bypass the Affordable Care Act's minimum medical loss ratio (MLR) requirement. By increasing drug prices at their pharmacy affiliates, insurers are able to shift excess profits away from the regulated insurance side to the unregulated pharmacy side. This practice allows insurers to remain compliant with MLR rules while still maximizing overall corporate profits.

2. Impact on Medicare Part D and Broader Implications: The researchers focused on Medicare Part D prescription drug plans, analyzing data from 2010 to 2016 and finding that affiliated pharmacies raised prices more than unaffiliated ones. The findings suggest that similar strategies could be used in other regulated markets where companies own both insurance and provider entities. This raises concerns about the effectiveness of profit caps when affiliates are not subject to the same regulations as the primary company.

3. Policy Challenges in Vertically Integrated Markets: The study concludes that regulating profits in markets where insurers also own key vendors, such as pharmacies, is particularly difficult. Efforts to cap profits or prices for insurers alone may inadvertently encourage further vertical integration and could even increase overall health care spending. Policymakers are advised to consider the broader structure of health care markets and the potential for profit shifting when designing regulatory interventions.

Mapping the Vertical Integration of Insurers, PBMs, GPOs, Specialty Pharmacies, and Healthcare Services: DCI’s 2026 Update

By Adam J. Fein, Ph.D. – It's time for Drug Channels Institute’s (DCI) annual update of vertical integration among insurers, PBMs, specialty pharmacies, and healthcare services within U.S. drug channels. As you can see below, we have updated and revised our infamous illustration of the major vertical business relationships within the largest companies. These organizations continue to exert greater control over patient access, sites of care/dispensing, and pricing, although some have started to unwind their vertical integration strategies. Scrutiny of these companies’ actions continues to grow. Read Full Article...

HVBA Article Summary

1. Evolving Vertical Integration Strategies: The largest U.S. healthcare companies continue to pursue vertical integration, linking insurers, PBMs, specialty pharmacies, and healthcare services under single corporate umbrellas. This integration allows these organizations to influence patient access, care sites, and drug pricing. However, some companies are now beginning to unwind certain vertical relationships, reflecting a dynamic and shifting industry landscape.

2. Expansion of Hospital Specialty Pharmacy Participation: Hospitals and health systems have become significant players in the specialty pharmacy market, now operating nearly one-third of all specialty pharmacy locations accredited by major organizations. Recent changes in manufacturer 340B contract pharmacy policies have accelerated hospitals’ investments in in-house specialty pharmacy operations. This trend is further supported by acquisitions and investments from major healthcare conglomerates in companies that assist hospitals with specialty pharmacy services.

3. Divestitures and Market Realignment: Several companies have recently divested or outsourced key business units, signaling a move to streamline operations or respond to regulatory and market pressures. For example, Centene has outsourced its PBM operations and sold off multiple subsidiaries, while Cigna has sold its primary care clinic group. These changes highlight the ongoing realignment within the healthcare sector as organizations reassess the value and risks of vertical integration.

New Mental Health Parity Index highlights where disparities persist

By Paige Minemyer – Despite policymakers putting a focus on the issue, mental health parity challenges remain for much of the country, a new report shows. The new Mental Health Parity Index identifies disparities in 43 states in terms of access to in-network mental health and substance abuse treatment in comparison to physical health. The analysis found that patients in seven out of 10 counties face challenges in accessing in-network mental healthcare. The index was developed by the Kennedy Forum with support from Third Horizon, the American Medical Association, the American Psychological Foundation and Ballmer Group. Read Full Article...

HVBA Article Summary

1. Widespread Disparities in Mental Health Access: The Mental Health Parity Index reveals that significant gaps persist in access to in-network mental health and substance abuse treatment compared to physical health services. These disparities are present in 43 states, with the majority of counties facing notable challenges. This highlights that despite policy efforts, equitable access to mental health care remains elusive for many Americans.

2. Payment Inequities Across States: The report found that payment rates for mental health and substance abuse treatment lag behind those for physical health in every state analyzed. The payment gap ranges from 16% to 59% depending on the state, indicating a systemic undervaluation of mental health services. Such disparities may contribute to provider shortages and further limit patient access to needed care.

3. Insurers Fall Short of Parity Benchmarks: None of the four largest commercial insurers evaluated in the index met mental health parity benchmarks on a national level, though some states and counties did achieve or exceed these standards. The index also identifies regions where insurer practices are more effective, offering potential models for improvement. Making this data publicly available is intended to drive accountability and encourage stakeholders to address persistent gaps in mental health parity.

Benefits Think: Clarity driving broker success in opaque times

By Kasey Devine – Every renewal season tends to follow the same script. Employers brace for increases. Brokers prepare explanations. Carriers point to trend, utilization and market pressure. What has changed is not the number itself, but how difficult it has become to explain where that number actually came from. More employers today are not asking why costs went up. They are asking why no one can clearly explain the increase. They want to know what truly changed year over year, which costs were unavoidable and which ones were the result of decisions that could have been made differently. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Benefit Costs Becoming Less Transparent: Benefit costs have not only risen but have also become more difficult to interpret and manage over time. Employers increasingly struggle to identify what truly changed year over year and whether cost increases were unavoidable or influenced by decisions. When clear explanations are not provided, frustration grows and the perceived value of broker support declines.

2. Fragmented Systems Driving Complexity: The benefits ecosystem now spans multiple vendors, funding arrangements and data sources that are not designed for easy comparison. Brokers often spend significant time manually consolidating data from various formats, limiting their ability to deliver clear insights. This fragmentation creates a sense of opacity for employers, even when substantial effort has been made behind the scenes.

3. Shifting Expectations Toward Clarity and Strategy: Employers are placing greater emphasis on understanding and managing benefit costs rather than simply negotiating renewals. Brokers are increasingly expected to explain what changed, why it changed and what can be influenced moving forward. Technology plays a supporting role by improving data consistency and transparency, allowing brokers to focus more on strategic guidance rather than administrative tasks.

Bill would force payers to apply DTC drug purchases to patient deductibles

By Paige Minemyer – A prominent physician voice in the House of Representatives has introduced a new bill that would compel insurers to apply the cost for drugs purchased from direct-to-consumer platforms to deductibles and out-of-pocket maximums. North Carolina Republican Greg Murphy, M.D., on Tuesday unveiled the Every Dollar Counts Act, a bill that aims to lower patients' out-of-pocket costs for pharmaceuticals. Murphy, a consistent critic of insurers and pharmacy benefit managers, notes in an announcement that consumers have increasingly embraced DTC offerings as costs rise. Using these platforms, patients can often find prices that cost far less out-of-pocket, especially for branded drugs, per Murphy's office. Read Full Article...

HVBA Article Summary

1. Legislative Aim to Reduce Patient Costs: The Every Dollar Counts Act seeks to ensure that patients who purchase medications through direct-to-consumer (DTC) platforms can have those expenses counted toward their insurance deductibles and out-of-pocket maximums. Currently, many health plans do not recognize these purchases, which can result in higher overall costs for patients. The bill is designed to address this gap and potentially make prescription drugs more affordable for consumers.

2. Growing Popularity of DTC Drug Platforms: The article highlights that DTC drug purchasing platforms are becoming increasingly popular among consumers, especially as traditional drug prices continue to rise. These platforms often offer lower prices for branded medications, making them an attractive option for patients seeking cost savings. The bill responds to this trend by aiming to integrate DTC purchases into the broader insurance framework.

3. Policy Context and Political Support: Representative Greg Murphy, who introduced the bill, has been a vocal critic of insurers and pharmacy benefit managers, arguing that current policies can create financial barriers for patients. The bill has gained attention following the launch of government-backed DTC initiatives like TrumpRx, which offer special pricing agreements with drug manufacturers. Murphy's collaboration with the White House on this policy underscores the growing bipartisan interest in reforming how drug costs are managed within the healthcare system.

Why traditional benefits education fails employees when it matters most

By Olga Cameron – Most employees don't realize they're confused about their benefits until something goes wrong. A bill comes in higher than expected. A claim is denied. A routine doctor's visit brings an unexpected expense. At that moment, information from open enrollment — guides, emails, meetings — rarely feels accessible or useful. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Timing and Retention Issues: Traditional benefits education is typically delivered during open enrollment, months before employees actually need to use their coverage. This gap in timing means that the information is often forgotten or feels irrelevant when real-life situations arise. As a result, employees struggle to recall important details when they face unexpected bills or claims.

2. Complexity and Misunderstanding of Plan Details: Many employees do not fully understand how different aspects of their health plans, such as deductibles, copays, and coinsurance, work together. This lack of comprehension leads to confusion and frustration when costs are higher than anticipated or claims are denied. Even when employees believe they understand their benefits, nuances in plan design and billing can create unexpected financial responsibilities.

3. Need for Personalized, Ongoing Support: The article emphasizes that employees benefit more from situational, personalized guidance rather than additional documentation or annual education sessions. When confusion arises, clear and empathetic support helps employees navigate their benefits and reduces strain on HR teams. Moving toward an ongoing, responsive approach to benefits education can improve employee satisfaction and trust.