It would be understandable if you are not aware of the Consolidated Appropriations Act. Your human resource department has other pressing priorities like hiring new employees and retaining old ones in a tight labor market, the pandemic, supply chain issues etc. That said, understanding the CAA is critical, because you have a new fiduciary responsibility equivalent to that of your company-sponsored retirement plan. It was not until corporate leaders faced lawsuits and fines related to their retirement plans that they fully realized the implications of related laws.
Great post. The most important second order effect of CAA will be the required change in the way that employers/purchasers procure their healthcare services. Under the existing arrangement, employers rely upon agents and brokers to ‘procure’ health services from the existing BUCA offerings. This procurement strategy is inherently conflicted because of the way that brokers are paid for their services........commissions and contingent compensation received for the placement and retention of coverage with specific carriers. Plan fiduciaries now need to consider the fiduciary standard under CAA as the basis for considering procurement and terms. Employers and especially named fiduciaries will need to consult new informed ‘truth sources’ to help them with procurement. Further, employers will need to review their data, reporting and analytics to make appropriate buying decisions on behalf of their plan beneficiaries.
Thanks Jeff. You are the most knowledgeable person that I know on the CAA. I am very grateful to you for bringing this important legislation to my attention. I would be happy to post anything that you write on the topic here. I think this can finally get us moving toward real value-based healthcare.
Great post. The most important second order effect of CAA will be the required change in the way that employers/purchasers procure their healthcare services. Under the existing arrangement, employers rely upon agents and brokers to ‘procure’ health services from the existing BUCA offerings. This procurement strategy is inherently conflicted because of the way that brokers are paid for their services........commissions and contingent compensation received for the placement and retention of coverage with specific carriers. Plan fiduciaries now need to consider the fiduciary standard under CAA as the basis for considering procurement and terms. Employers and especially named fiduciaries will need to consult new informed ‘truth sources’ to help them with procurement. Further, employers will need to review their data, reporting and analytics to make appropriate buying decisions on behalf of their plan beneficiaries.
Thanks Jeff. You are the most knowledgeable person that I know on the CAA. I am very grateful to you for bringing this important legislation to my attention. I would be happy to post anything that you write on the topic here. I think this can finally get us moving toward real value-based healthcare.