Dave Chase posted the following commentary on Linkedin. His comments are followed by a link to the article:
Given the Association of Corporate Counsel house publication reaches 99% of Fortune 100 #corporatecounsel, the article “ERISA-Covered Companies Must Disclose Health Plan Costs” is a BFD as one former VP once said 😀. The most astute #healthplan experts (which includes the article authors) recognize the new law is the largest change in #employeebenefits since 1943. And largest change in corporate governance since 2002 (Sarbanes-Oxley).
By all accounts, the vast majority of #healthbenefits brokers/consultants are failing in their duty to let their clients know about what a Big Four Risk Management practice leader described in Chapter 19: “ERISA Fiduciary Risk is the Largest Undisclosed Risk I’ve Seen in My Career” of the CEO’s Guide to Restoring the American Dream.
Why are they failing?
➡️ Full disclosure of direct and indirect compensation triggers the business equivalent of finding out one’s spouse cheated on them
➡️ It threatens major revenue streams of large publicly traded benefits broker firms.
The article is the cover story of The Docket. Nearly 52% of their 1.2 million readers hold the title of General Counsel, Chief Legal Officer, or Senior Attorney for the 10,000 employers they reach.
The article opens with a “Cheat Sheet” highlighting these 4 key points
1️⃣Know your fiduciary responsibilities. While ERISA has focused on retirement service fees in the past, the spotlight is now on healthcare costs.
2️⃣Prepare to publish fees and pricing. Responsibilities handled by other parties do not relieve fiduciary duties.
3️⃣Get brokers and consultants on board. They will need to disclose their compensation to plan fiduciaries.
4️⃣Consider establishing a chartered fiduciary committee. Plan sponsors should designate a fiduciary — a single person or a committee — to oversee the obligations.
The rest of the article sheds more light on the critical requirements and risks facing corporate America.
This is a crucible moment for corporate America driving them into one of two choices
1️⃣ Step up: In a nutshell, apply the same care they provide to a)401k fiduciary b)all other purchases [which they are miles away from today] while walking the talk of “employees are our most valuable asset” which every CEO says
2️⃣ Step out: If they don’t step up, they’ll have severe legal exposure for them & their board members so they’d become advocates for removing employers from health benefits
SEE ARTICLE HERE: ERISA-Covered Companies Must Disclose Health Plan Costs | ACC Docket