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Conventional wisdom in self-funded health benefits says plan sponsors have to choose: better care or lower costs. But finance and benefits teams that work on health plan strategy together are finding that’s a false choice — and that the leverage hiding in their current plan is often larger than expected. Vendor incentive structures, claims data access, site of care, stop-loss governance, and fiduciary risk are all places where the math can shift — without changing carriers.
Here are ten places to start looking.
1. Understand how your vendors get paid.
It starts with a simple math problem. As Stacey Richter, Host of the Relentless Health Value Podcast, put it:
“If I’m making 15% off $100, I make $15. If I get 15% off $200, I just doubled that. So anyone getting paid as a percentage actually benefits when the price of healthcare goes up.”
The result, she noted, is that “plan sponsors pay $1.20 to get $1 of healthcare” — with providers receiving 80 cents and doctors and nurses making 20 cents. When the people you rely on to keep costs down have a financial interest in costs going up, that’s a structural problem worth solving.
Starting question: Do your vendor agreements tie their compensation to your spend levels?
2. “Discount” is a marketing term, not a savings strategy.
Richter was direct about this one:
“When you buy discounts, what you’re actually doing is creating even another incentive for the prices to go up, because if the prices go up, then I can get a bigger discount.”
Her framing: a 90% discount on a $600 charge is $60. A $40 charge from an independent provider — with no discount — is still $40. Headline discount rates don’t tell you what your plan is actually paying.
Starting question: What is your plan actually paying per unit of service?
3. Your claims data is yours — make sure your contract says so.
Richter was blunt about what happens when employers try to claim data they didn’t explicitly protect in their contracts:
“The plan sponsor took the entity to court and said, hey, we should get our data. And the entity’s response? ‘You signed it. You didn’t have to sign it, you signed it, so now it’s your problem.'”
The Consolidated Appropriations Act (CAA) of 2021 makes data withholding illegal — but older contracts with restrictive language can still create problems.
Starting question: Does your contract allow access to your claims data?
4. Vendor fee disclosures are now a compliance requirement.
The CAA of 2021 requires brokers and consultants to disclose all compensation. The CAA of 2026, signed February 3, 2026, extends the same to PBMs. As Richter noted, this has raised the stakes for plan fiduciaries:
“There’s a transparency arms race now, because this information is available. Who is looking at it? The shareholders of some companies are looking at it — and this is the second biggest line item, second biggest cost, after payroll.”
Documenting your review of vendor compensation is a fiduciary requirement — and one that benefits from HR, finance, and legal working through it together. (Groom Law Group, February 2026)
Starting question: Has your broker provided a fee disclosure, and has your team documented the review?
5. “In-network” means a rate was contracted — nothing more.
Ron Peck, Chief Legal Officer at The Phia Group, was clear on this point:
“In-network just means that the rate is contracted for — meaning you take the billed charge, you subtract the discount, and you pay that amount. That’s not what quality means.”
He and Richter both cited what happens when disruption analyses prevent plans from removing low-performing providers. Richter’s example: “There was an OB/GYN who had 75% healthy birth C-sections — very, very problematic — but they wound up still being in-network because if you do a disruption analysis, you can’t cut anybody out.”
Starting question: When did your organization last evaluate clinical quality metrics alongside coverage data?
6. Site of care is one of the fastest levers available.
Richter put the scale of this opportunity in concrete terms:
“If an employee goes to one place, it’s a million dollars more than if they go to a similar place down the street. We’re not talking about splitting hairs — we’re talking about site of care. What could we do with $1 million?”
She also cited a direct contracting example: a plan paying $90,000 for four Crohn’s disease infusions found an independent practice that could provide the same care at a fraction of the cost. Same clinical outcome. Dramatically different bill.
Starting question: What percentage of your top procedure codes are being performed at hospital outpatient departments versus independent sites?
7. Read your plan documents — and compare them to each other.
Peck’s top tactical recommendation was simple: start with the contracts.
“The first three pages tell you what you want to hear. The next 60 pages tell you why they’re not going to do it.”
He also flagged the gap that creates quiet liability for many employers: “Your handbook says if you’re on an approved leave of absence, you’ll be kept on the benefit plan. But your plan document says if you’re not actively at work after 60 days, you’re kicked from the plan. Which controls? Don’t let it happen in the first place. Compare the documents. Find the low-hanging fruit and fix it.”
Starting question: Has anyone compared your plan document, HR handbook, and stop-loss contract side by side for contradictions?
8. Member engagement is a financial strategy, not just an HR metric.
Richter cited a number that reframes the urgency here:
“61% of commercially insured Americans right now are delaying or foregoing care due to cost. We have 41% of Americans with medical debt. Emergency rooms are the most expensive primary care you can buy.” (KFF 2025 Employer Health Benefits Survey, kff.org)
Starting question: What is your plan’s ratio of ER utilization to primary care visits?
9. Stop-loss deserves CFO-level attention.
49% of plan sponsors reported at least one claim exceeding $1 million in the last two policy years. (IFEBP / Aegis Risk 2025 Stop-Loss Survey, aegisrisk.com) Peck was direct about how quickly administrative gaps can become balance-sheet problems:
“If I go with the handbook over the plan document, I’m violating my plan document — which exposes me to fiduciary breach, not to mention the fact that the plan’s stop-loss is not going to reimburse me.”
Starting question: Has someone in the CFO’s office reviewed the stop-loss contract directly — not just a summary from HR or the broker?
10. Health plan governance is becoming a finance and legal priority.
Lewandowski v. Johnson & Johnson (filed February 2024) alleged plan fiduciaries “mismanaged prescription-drug benefits, costing their ERISA plans millions.” (Case 1:24-cv-00671, D.N.J.) A wave of similar cases has followed.
Ron Bell, Collective Health’s Chief Legal Officer, framed it straightforwardly:
“It’s not just an HR benefits issue. It’s increasingly a legal issue. There are a growing number of employers being sued — and if you haven’t considered whether your members might be being pushed to higher-cost solutions, you can be held liable.”
Starting question: Does your health plan have the same governance infrastructure as your 401(k)?
👉 Ready to see better benefits? See Collective Health in action.
Sources
All panel quotes: Stacey Richter (Relentless Health Value Podcast) and Ron Peck (Chief Legal Officer, The Phia Group) at Together 2026, Collective Health’s 9th annual employer conference, March 4–6, Scottsdale, AZ.
Additional sources: KFF 2025 Employer Health Benefits Survey; Groom Law Group; IFEBP / Aegis Risk 2025 Stop-Loss Survey; Lewandowski v. Johnson & Johnson, Case 1:24-cv-00671 (D.N.J. 2024).
