Demystifying the Dollars in Voluntary Benefits
A sponsor's perspective
Webcast - March, 2025
Amy highlights market trends that are driving adoption of popular voluntary benefits, like Supplemental Health Plans (SHPs), while she reviews how the complexity of the voluntary benefits space obscures transparency for plan sponsors. She relays how compensation structures can drive behaviors that may not align with the interests of both sponsors and employees. Amy also discusses how the Affordable Care Act (ACA) has limited transparency by requiring fully insured plan structures.
Keith reivews his experience navigating complex voluntary benefits systems. He provides insights into changes in commission structures and how broker compensation impacts the market. Key lessons are shared from working with large, diverse organizations. Keith highlights how brokers use a "magician trick" to keep employers focused on healthcare costs while earning large commissions on voluntary benefits. He also emphasizes why employers should question consultants about captives and commission structures to ensure transparency and align their interests.
Erik discusses risks and compliance issues in voluntary benefits, highlighting parallels with 401(k) lawsuits and the importance of understanding where the money flows. He emphasizes the need for transparency to prevent misuse of employee funds and explained how captives can optimize costs and improve efficiency. Erik debunks myths about captives being "risky" and urges employers to understand their responsibilities, ask the right questions, and to prioritize employee interests.
Allie covers the rise of class-action lawsuits in 401(k) plans and expanded focus on health and welfare benefits, including voluntary benefits. She highlights 408(b)(2) regulations promoting transparency in health plans and state-level pushes for loss ratio regulations in voluntary benefits. Allie encourages employers to proactively assess risk by documenting their due diligence and to consider plan design changes, which can be less visible to employees. She discusses the use of captives for reinsurance to simplify plans with expert guidance, avoiding confusing disclosures.
Questions and Answers, and closing remarks.