The Parallel Paths: Why Health Benefit Plans Are Entering the Same Litigation Cycle as Retirement Plans
What Happened in Retirement Plans — And Why It’s Happening Again
Retirement plans went through a major transformation starting 10–15 years ago.
We saw:
Rapid litigation growth
Pressure on fee transparency
Increased scrutiny of advisor compensation
Heightened expectations for benchmarking and process documentation
Health benefit plans are now following the same pattern.
Why?
Because the structural risks are nearly identical.
The Signals That Health Plans Are Next
We’re already seeing the early indicators:
Broker compensation scrutiny is increasing
Commissions, overrides, and bonuses are no longer “background details.”Regulators want more transparency
Health plans have become financially significant, especially for self-funded employers.ERISA attorneys are raising early alarms
Many now recommend independent evaluations before issues arise.
These aren’t isolated events — they're early tremors of a larger shift.
The Three Patterns Repeating Themselves
1. Lack of Competitive Review
Just as with retirement plans a decade ago, many health plans haven’t benchmarked fees or evaluated alternatives in years.
2. Inadequate Documentation
Verbal updates and vendor slide decks are not a fiduciary record.
3. Misunderstood Compensation Structures
Opaque broker arrangements were a trigger for retirement plan litigation — and the same is unfolding in health benefits.
What Plan Sponsors Must Do Before the Wave Hits
To prepare, sponsors should:
Conduct independent evaluations every 3–5 years
Benchmark fees, services, and performance
Review compensation structures for brokers and consultants
Ensure processes align with fiduciary expectations
Waiting until litigation becomes widespread will be costly.
Proactive Action Costs Less Than Reactive Defense
Organizations that acted early in the retirement plan cycle avoided:
Lawsuits
Settlements
Forced provider changes
Reputational damage
Health plans now have the same opportunity.
Get Ahead of the Curve — Before You’re Forced to Catch Up
The parallels are undeniable.
The timeline is accelerating.
Plan sponsors who prepare now will be the ones protected later.
Want a presentation of “Parallel Paths” for your leadership team or board? Request a session.