A point that Dave Chase makes in his book The Opioid Crisis Wake-Up Call is that employers are not fulfilling their fiduciary duties to their employees with regard to the healthcare products that they offer as benefits. I mentioned earlier that many companies have an HR person in charge of health benefits who doesn’t really understand health insurance and whose main goal is to not be yelled at by other employees for problems, high costs, and restrictions with their health insurance plan. The result has been a bit catastrophic, with plan costs rising continually, insurance companies and major healthcare systems ganging up on uninformed benefits managers, and healthcare brokers taking questionable bonuses from various arms of the healthcare sector.
David Contorno, founder of a company called E Powered Benefits, contributed a chapter to Chase’s book specifically highlighting many of the problems with the current broker arrangements that companies face. He writes, “Recently, a Blue Cross health plan offered their brokers a $50,000 reward for switching self-insured clients back to more lucrative, fully-insured plans. In sectors like financial services, that kind of undisclosed conflict could land a person in jail. In healthcare, however, such clear conflicts of interest are common and considered business as usual.” While this kind of broker arrangement is deplorable, the heat should not only be on the brokers. Employers are also responsible for ensuring they are partnering with brokers who are free from conflicts of interest, and there are groups now popping up to help employers identify brokers who don’t engage in such shady behind the scenes agreements with health insurance companies and healthcare systems.
Employers are responsible for the sound management of the financial resources they manage for their employees, whether it is retirement savings accounts or health insurance plans. Employers purchase and manage health insurance products for employees, however many of the healthcare decisions are made by people who don’t fully understand them, with the goal of not making people too angry, and with direction from actors who are not as independent as they claim. Chase worries that there could be an explosion of lawsuits against companies for operating in this system. Lawsuits holding companies responsible for out of control increases in healthcare plans could dramatically shake-up the way health insurance is provided and purchased in the United States. The bottom line is that as things stand now, the financial considerations of employees, the people who will use the product purchased for them, is not one of the main considerations in the purchasing of healthcare plans, and a lot of shady looking things take place among employer-broker-provider-insurer relationships.