February 2026 The Self-Insurer

To Bundle or Unbundle Pharmacy Benefits?

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By Laura Carabello

By Laura Carabello

WHETHER

By Bruce Shutan

By Chris Condeluci, Esq.

The Self-Insurer (ISSN 10913815) is published monthly by Self-Insurers’ Publishing Corp. (SIPC). Postmaster: Send address changes to The Self-Insurer Editorial and Advertising Office, P.O. Box 1237, Simpsonville, SC 29681, (888) 394-5688

PUBLISHING DIRECTOR Bryan Irland, SENIOR WRITER Bruce Shutan, CONTRIBUTING EDITORS Mike Ferguson, Jennifer Ivy, PRESIDENT/CEO Erica M. Massey, CFO Grace Chen

To Bundle or Unbundle Pharmacy Benefits?

ThisTWritten By Laura Carabello

“Shakespearean-style” question raises an issue that is top-of-mind for many health plan sponsors:  Stay the course with a traditional carved-in approach that bundles pharmacy and medical benefits, or initiate a strategic shift toward innovative, alternative pharmacy benefit management (PBM) models that unbundle the services to increase transparency, control costs and allow for greater customization?

While there are numerous explanations of the models, the definitions below draw upon key industry resources:

CARVE-IN BUNDLED PLANS

Under the traditional bundled PBM model, all healthcare arrangements are handled under one roof: a single provider services a carved-in pharmacy benefits plan, holds the PBM contracts, and handles the benefit and costs. The plan sponsor remains one step removed.

When pharmacy plans are integrated into an employer’s medical benefits, they can be overshadowed by the size and influence of the medical vendor. This results in less flexibility in terms of customizing plan designs and fully personalizing plans to fulfill plan participants’ unique needs. Advisors at Navitus also explain the opportunity for plan sponsors to consider medical specialty carve-outs, especially with specialty medications now accounting for more than half of the total pharmacy spend. They suggest that it’s time to rethink the management of these drugs that are billed under the medical benefit.

With this model, the PBM controls nearly every element of the pharmacy supply chain -- a complete service package that typically includes:

• Network pharmacy contracting

• Claims adjudication platforms

• Specialty pharmacy fulfillment

• Mail-order services

• Manufacturer rebate negotiations

• Data reporting

Source: Cigna

Instead of charging employers straightforward administrative fees, bundled PBMs generate revenue through multiple indirect streams, including:

Spread Pricing

PBMs charge employers more than they reimburse pharmacies and keep the difference—often hidden inside claims data.

Retained Rebates

While employers believe rebates reduce net drug costs, many PBMs:

• Retain undisclosed portions of manufacturer rebates

• Apply rebates to offset premium equivalents rather than directly lowering claims

• Aggregate employer rebates without transparent allocation

Specialty Pharmacy Markups

PBM-owned specialty pharmacies purchase drugs at heavily discounted rates yet bill plan sponsors at rates far exceeding acquisition cost.

Channel Steering

PBMs direct employees toward their own mail-order or specialty facilities to preserve margin—sometimes at the expense of continuity of care or cost-effectiveness.

Source: United Healthcare

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CARVE-OUT UNBUNDLED PLANS

Under this model, employers or plan sponsors contract with a separate company to “carve-out” benefits focused on specific diseases, such as diabetes, cancer or other specialty treatments. Carve-outs unbundle the overall pharmacy benefit that would traditionally be handled by a single medical provider.

Unbundling pharmacy benefits means adopting a modular approach that allows competitive bidding for each segment -- outsourcing each service component to separate vendors. As a result, employers migrate from one single PBM agreement to:

• A transparent claims processing administrator

• Separate competitive pharmacy networks

• Independent rebate aggregators who pass 100% of rebates back to the plan

• Open specialty pharmacy networks using lowest net-cost sourcing

The core components of an unbundled PBM strategy may include:

• Claims Processing Platform: receives pharmacy claims, applies formulary coverage logic, calculates copays and deductible accumulators, and operates on a flat administrative fee.

• Pharmacy Network Contracting: rather than exclusive PBM pharmacy networks, employers gain open access networks, allowing direct negotiations with high-volume pharmacies, performancebased pharmacy contracting and maximum competitive pressure on dispensing fees

• Rebate Contracting: independent rebate aggregators negotiate directly with manufacturers and can pass through100% of rebate dollars, provide detailed rebate transparency, and align rebate structures with employer formularies.

• Specialty Pharmacy Sourcing: utilizes multiple specialty pharmacies, secures drugs at actual acquisition cost, and avoids exclusive arrangements that lock patients into higher-cost fulfillment systems.

• Clinical Formulary Management: enables customized formularies to emphasize biosimilar adoption. cost-effective therapeutic alternatives and value-based medication tiers for chronic conditions.

Whether to bundle or unbundle pharmacy benefits, it’s the operational perspective that matters more than you think.

That’s the guidance offered by April Gill, CCO, Smart Data Solutions, who shares, “Most discussions focus on financial outcomes, rebate structures or transparency concerns. But an equally critical and often underestimated dimension is operations – the real impact of this decision is operational.”

She explains that research consistently shows that both bundled and unbundled models can deliver cost savings or inefficiencies, adding, “The differentiator is not in the philosophy itself but rather the operational infrastructure and automation maturity to support the model selected.”

Gill says bundling can streamline workflows and improve coordination by unifying data, prior authorization, and claims processes, and has been associated with lower medical utilization in some populations. However, she cautions that it may reduce pricing transparency and flexibility.

“Unbundling offers greater control, vendor choice, and cost visibility, but increases operational complexity and administrative burden if systems are not well aligned,” continues Gill. “Ultimately, success in either model depends on automation, interoperability, and workflow intelligence. Strategy sets direction, but infrastructure determines performance.”

UNDERSTANDING THE PROS AND CONS OF BUNDLING

Bruce D. Roffe, P.D., M.S., H.I.A., president & CEO, H.H.C. Group, provides a balanced viewpoint:

“Bundling improves care coordination, enabling one vendor to integrate data from both medical and pharmacy claims, resulting in better management of chronic conditions and medication

adherence. This approach facilitates easier identification of gaps in care and potential drug interactions, resulting in cost management controls that often allow for combined utilization management, reduced duplication of services and improved formulary alignment. There is also increased “potential for better negotiating leverage with providers and manufacturers.”

Roffe also points to the benefit of simplified administration, with one point of contact for eligibility, claims, reporting, and customer service. Easier implementation of value-based care programs that span both medical and pharmacy leads to enhanced reporting and analytics, with unified data providing more comprehensive insights into the total cost of care and better capabilities to track outcomes and ROI for integrated programs.

Roffe also reviews the cons of bundling, citing vendor lock-in arrangements that limit flexibility to choose best-in-class solutions for pharmacy vs. medical and make it harder to switch vendors if performance is poor.

“The increased potential for higher costs is evident, as some bundled arrangements may not deliver true savings if the vendor lacks strong pharmacy cost controls,” he continues. “There is also elevated risk of hidden fees or less transparency in pricing, with limited opportunities for

customization as employers or TPAs may lose the ability to tailor pharmacy programs independently (e.g., specialty drug carve-outs). Moving to a bundle model can require significant system and process changes that result in operational complexity during the transition.”

He concludes that while integration simplifies administration and improves care coordination, it often comes at the expense of flexibility and pricing transparency, concluding, “This is why many TPAs and health plans must weigh the benefits of operational simplicity against the strategic need for control over pharmacy spend. Bundling can lower costs through integration and scale, but employers and TPAs need to scrutinize pricing models, rebate guarantees, and performance metrics to ensure promised savings materialize.”

UNDERSTANDING THE PROS AND CONS OF UNBUNDLING

Scott Byrne, president of Blackwell Captive Solutions, provides an overview.

“Bundling pharmacy and medical can simplify administration, but that simplicity often comes at the cost of visibility and control. When pharmacy is carved in, employers lose clarity on what drives trend and have limited ability to intervene. Unbundling opens the door to transparent pricing and best-in-class partners, which is critical as specialty drugs become a leading cost driver. Integration challenges can occur if contracts aren’t aligned, but with strong governance, those risks are manageable. For most employers, unbundling delivers more customization, clearer data, and a more sustainable long-term cost strategy.”

While bundling pharmacy with medical can feel convenient, Byrne advises that convenience often comes with trade-offs that limit an employer’s ability to manage rising costs. When pharmacy is carved in, pricing, rebates, and clinical strategy sit behind opaque structures that make it hard to see what is truly driving trend.

“Unbundling restores transparency and gives employers access to best-fit partners,” he continues. “Yes, multiple vendors require clearer contracts, but strong governance solves that. For most organizations, the long-term value of unbundling -- clarity, control, and the ability

to guide strategy -- outweighs the short-term simplicity of bundling.”

Source: Education Dynamics

Byrne views integrated models as an opportunity to streamline certain administrative tasks, but they often centralize control in ways that limit an employer’s line of sight into pharmacy performance.

“You may get one point of contact, but you also inherit that partner’s formularies, pricing logic, and rebate structures,” he explains. “That can make it harder to customize strategies or verify whether programs are driving measurable impact. In my experience, employers don’t struggle most because they have too many partners; they struggle most when they lack the transparency needed to make informed decisions. Flexibility and clarity usually create stronger coordination than a single integrated vendor.”

While bundled contracts sometimes appear less expensive upfront, Byrne says the true cost picture is more complex, adding, “When pharmacy is packaged inside medical, employers often lose insight into how drug costs are calculated or how rebates flow. That can mask trend rather than reduce it. In a bundled arrangement, savings usually come from negotiated discounts or guarantees, not

from the underlying clinical strategies that actually change outcomes. Bundling can reduce administrative fees, but it rarely addresses the specialty-drug inflation that drives the majority of year-over-year increases.”

He maintains that sustainable savings come from transparency and targeted management, not from packaging benefits together.

“Unbundling pharmacy from medical benefits allows employers to design a strategy that actually fits their population and financial goals,” says Byrne. “It opens the door to transparent

pricing, gives employers a clear view of what they’re paying for, and enables direct partnerships with vendors that specialize in high-cost areas like specialty pharmacy. It also allows employers to negotiate terms based on performance rather than accepting a one-size-fits-all bundle.”

For organizations to succeed in the long term, Roffe advises that they insist upon flexibility and measurable outcomes, noting, “Unbundling isn’t just about choice, it’s about building a model that employers can truly manage.”

Issues can arise, however, when pharmacy and medical are separate. Lack of integration can create problems, especially if contracts are not carefully managed. Roffe points out the risks of creating data silos when medical and pharmacy vendors may not share data, making it harder to manage total cost of care.

“There is also the risk of duplicate or conflicting programs,” he says. “For example, both vendors may implement separate prior authorization processes, frustrating providers and members. There is further potential for misaligned Incentives, as pharmacy vendors may push high-cost drugs that increase medical costs, while medical vendors focus on reducing hospitalizations without considering drug adherence.:”

Additional concerns are coordination failures since specialty drug management often requires close collaboration between medical and pharmacy benefits, and a lack of integration can lead to delays or coverage disputes. Contractual gaps might also arise if responsibilities for certain drugs (e.g., infused medications) are unclear, leading to disputes and unexpected costs.

“Yes, unbundling generally empowers employers with greater control, transparency, and flexibility, but it comes with added responsibility for managing vendor relationships and ensuring integration of data and care,” affirms Roffe.

MORE SUPPORT FOR UNBUNDLING

Justin Jasniewski, CEO, Serve You Rx, did not hesitate, “We advocate for unbundling. While bundled solutions promise administrative simplicity,

they sacrifice transparency and employer control. When pharmacy is embedded in the medical benefit, employers tend to have less visibility into cost drivers, less access to data, and little influence over pharmacy strategies.

When asked if unbundling creates operational challenges, he was emphatic, “Yes, if the right partners are not selected. However, with clear coordination, modern technology, and a focus on service, a seamless experience is achievable. The real question is: are you willing to accept limited transparency for perceived convenience? “

He further says that integration may simplify some administrative processes, “But that convenience comes at a cost. In bundled arrangements, carriers dictate formulary decisions, network options, and clinical programs - leaving little room to customize. True flexibility means selecting best-in-class partners and aligning programs to your population's specific needs.”

Jasniewski maintains that unbundling allows employers to customize plans, negotiate directly with vendors for greater control and transparency and select best-in-class partners for specific services.

“Absolutely -- unbundling returns visibility and control to employers,” he states. “In an unbundled arrangement, you can evaluate pharmacy performance independently, select partners that reflect your priorities, know what you’re paying for, and hold your PBM accountable. Most importantly, you gain transparency into pricing, rebates, and outcomes - the foundation for informed benefit decisions, not to mention what is demanded today of plan fiduciaries.”

FUTURE-FORWARD PHARMACY BENEFITS MODEL

Industry trackers report that while self-insured stakeholders were promised a bundled approach would deliver efficiency through scale, this model is apparently losing its luster. In 2026, employers are increasingly adopting an unbundled model to improve their negotiating power, potentially achieve better discounts -- especially for high-cost specialty drugs -- and gain more visibility into spending.

Unpacking the transition, a recent survey from Pharmacy Strategies Group (PSG) found that nearly one in three organizations are evaluating unbundled PBM models. Respondents say they prefer modular frameworks that allow plan sponsors to separate individual services and choose specialized partners based on performance, value and strategic fit. This shift brings greater control and agility, both of which are often limited in traditional PBM arrangements.

Lori Daugherty, CEO, RxLogic, concurs, “As a technology partner to pharmacy benefit management stakeholders seeking alternatives to the traditional PBM model, we find that many are considering or exercising their options to choose an unbundled model. For example, employers and health plans that implement an unbundled model often gain greater visibility into drug utilization trends, improved rebate transparency and enhanced control over formulary design, ultimately reducing overall drug spend while improving member outcomes.”

She points to several factors that account for this shift:

1. Cost Control: As pharmacy benefit costs continue to rise, employers are looking for ways to manage these expenses more effectively. Unbundling allows them to have more control over the costs associated with pharmacy benefits.

2. Transparency: Traditional PBM models often lack transparency, making it difficult to understand where the money is going. Unbundled models provide greater visibility into the costs and operations of pharmacy benefits, helping employers make more informed decisions.

3. Flexibility: Employers are seeking additional flexibility in administering their plans. Unbundling allows them to tailor their pharmacy benefits to better meet the needs of their employees and their organization.

4. Popularity of GLP-1 Drugs: The recent popularity of GLP-1 drugs has highlighted the advantages of unbundled PBM models. These drugs are often expensive, and unbundling can help employers manage the costs associated with them more effectively.

“A fully unbundled model enables more informed decisions based upon a plan’s specific goals about whether to adopt modular PBM carve-outs or fully unbundled models,” continues Daugherty. “Success depends upon the ability to leverage technology that effectively coordinates care and maintains high-quality patient outcomes.”

Daugherty details the benefits of a fully unbundled model:

• Provides comprehensive control over all aspects of pharmacy benefits, allowing for more effective management.

• Offers enhanced transparency, ultimately reducing overall program costs while improving access to accurate data.

She emphasizes that there are certain caveats that underscore the value of selecting a technology partner that recognizes the importance of flexibility and offers a configurable platform with API-integration capabilities for optimal plan design.

"Managing a fully unbundled model adds complexity and administrative burden, which is why a technology partner like RxLogic is essential, providing the solutions and vendor integrations needed to simplify operations,” she continues. “However, technology must be designed with flexibility at its core to support both bundled and unbundled models. This adaptability allows users to build and manage various rule sets tailored to their specific plan and benefit designs.”

PREPARE FOR THE FUTURE

A clear indication of this trend towards alternative PBMs is the announcement from pharmaceutical giant Eli Lilly, which is dropping its contract with CVS Caremark as the PBM for its 23,000 US-based employees. Lilly joins other large employers (including Tyson Foods) that are making a switch, but the Lilly decision is especially noteworthy since drug manufacturers have been so critical of the giant PBMs and their approach to bundled services, yet they renewed their arrangements year after year. This may be a sign that things are really moving in that direction.

Additional documentation of the trend comes from a Mercer survey on health and benefit strategies for 2026. It found that health plans are breaking free from the traditional “all-in-one” PBM approach, with about 10% of health plans exploring modular, unbundled models. Rather than contracting with a single PBM for all pharmacy services, leading health plans — including Blue Shield of California — are unbundling traditional pharmacy benefit functions to achieve greater savings, such as rebates, adjudication, retail, mail and specialty pharmacy. Unbundling allows employers to choose their PBM vendor without the influence of the medical vendor.

The decision to bundle or unbundle pharmacy benefits becomes even more critical for employers of every size as federal and state regulators continue to debate PBM reforms. With an eye on increasing transparency, changing the rules on rebates and introducing direct-to-consumer drug purchasing programs, legislators are calling for change with increased clarity, determining the difference between short-term repairs vs. sustainable long-term solutions.

With a goal to truly align the model with a plan’s clinical and financial objectives, leaders should:

Review Current Contracts: Examine the terms to fully understand current pricing structures and the inclusion of any clauses that may result in hidden costs. Develop a strategy, create a plan and define plan goals for cost containment, member support and pricing transparency.

Compare Options: Evaluate different PBM and pharmacy benefit solutions to arrive at the best fit for your organization's needs. If simplicity is the key priority, bundling may still be the optimal choice. However, plans seeking significant cost savings and greater control may opt for unbundling as the clearer path forward in an environment where specialty drug costs continue to accelerate.

Get Expert advice: Identify an experienced benefits consultant that you trust guide your decision. Check with your broker or TPA, who can also help navigate the complexities of bundling vs. unbundling.

Laura Carabello holds a degree in Journalism from the Newhouse School of Communications at Syracuse University, is a recognized expert in medical travel and is a widely published writer on healthcare issues. She is a Principal at CPR Strategic Marketing Communications. www.cpronline.com.

Strength in Numbers

Whether it’s a consortium or stop-loss group captive, smaller employers are increasingly pooling their purchasing power to make self-insured health benefits more affordable

FWritten By Bruce Shutan

For small and midsize employers that self-insure their employee health benefits, there’s genuine power in banding together to contain soaring costs. One huge advantage of a consortium is that there’s no need to put up any collateral, a barrier to entry for those who cannot afford to be part of a stop-loss group captive. However, investing in a captive can yield dividends – making it yet another tantalizing option for smaller entities.

Is there a clear winner between the two? The answer isn’t necessarily cut and dried. Two industry experts wrestled with this question during a panel discussion at SIIA’s 2025 national conference, explaining that minor differences make both these approaches palatable for organizations that prefer not to go it alone.

“There are so many similarities with these programs that it gets a little murky in terms of how you really differentiate them,” observes Jeffrey Fitzgerald, managing director of Strategic Risk Solutions, who moderated the session. “The buyer is becoming increasingly the same. The only real difference, essentially, is that there’s a level of compliance and ownership in a captive. I think captive members can sometimes overstate that, and consortium members can sometimes underestimate how much that really does make a change.”

Whereas consortiums sell prospective members on leveraging their buying power to land better rates, he describes stop-loss group captives as more of an exclusive club of highly educated consumers that strive to understand how the vendors associated with self-funding work.

Any differences in these two models are negligible enough that making the case for either vehicle’s superiority is like saying one twin brother is uglier than the other, quips Brad Kopcha, EVP of Actuarial Services and Corporate Development at Benecon.

ENORMOUS MARKET POTENTIAL

There’s enormous market potential for both consortiums and captives. A 2024 Kaiser Family Foundation study found that just 20% of covered workers in employer groups with 199 or fewer employees are self-funded. With more employers flocking to self-insured solutions, these

group models are expected to share in the industry’s growth.

A recent McKinsey report estimated that 12 million U.S. health plan members are going to leave the fully insured model by 2030 and flock to level-funded captives or self-funding. The reason is simple: “Small to middle-market employers are sick and tired of being stuck in the Dark Ages with no transparency and having to swallow last-minute renewals that they have no ability to control,” notes David Konrad, VP of Accident and Health for Coverys.

Kopcha believes employers increasingly will be drawn to a consortium or stop-loss group captive as multimillion-dollar claims increase, along with specialty drugs and cell and gene therapies, and the commercial insurance market continues to harden.

While industry experts say employers in the 50 to 200-life space could benefit from being self-funded, it’s often difficult for them to do so by themselves. Facing an 86% loss ratio in the employer stoploss space in 2024, Kopcha says there had to be a hardening of the commercial market, which was driving losses for 25 carriers.

“I had multiple brokers call me in tears over losing accounts, and that they couldn’t keep up with the way the market was going,” he recalls.

That trail of tears is likely to swell. Kopcha predicts that the next two cycles in July 2026 and January 2027 will also be hard because carriers will not see rate actions hit their financials until maybe the third and fourth quarter of this year.

‘BEST-IN-CLASS EXPERIENCE’

Kopcha has helped more than 2,000 employers set up in 15 different consortium models across the U.S., funding of roughly $3 billion in annual employee healthcare benefits, with about $700 million in annual stop-loss purchases for these programs.

He believes it’s a bit easier for groups to join a consortium, which is slightly less expensive, because a captive requires upfront collateral or capitalization to essentially join an insurance company. Still, that financial commitment needs to be put in perspective. Fitzgerald, for example, notes that at 10% to 15% of the stop-loss premium or 5% to

7% of the overall spend, the collateral required for a stop-loss group captive isn’t a significant amount of money.

One downside to establishing a consortium is that it’s difficult to do from a regulatory standpoint. Kopcha cites as an example the Florida Government Healthcare Solutions for public entities across the Sunshine State. “That took us over two years to set that up,” he says, adding that the price tag to build it 13 years ago was $500,000.

The founder of his firm, Sam Lombardo, helped pioneer the concept of aggregating self-funded health purchasing in 1991 when he decided to negotiate the fully insured renewals of four municipalities as a single entity to secure a better rate for each of those clients. That following year, two more municipalities joined the group, whose relatively small individual members grew to roughly 100 employers by the turn of the century.

When a chief actuary was then brought on board, the group had finally reached enough critical mass to justify his suggestion that it switch to a self-funded model. At that time, Kopcha was working as an actuary in the same Pennsylvania market for a health insurance carrier that was losing groups to this consortium.

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He wondered what was going on.

The group’s chief actuary explained to him the value of negotiating risk transfer up front for this collection of tens of thousands of employees with multiple stop-loss carriers in the market. Kopcha realized the power of self-insurance for smaller groups and eventually took over for the chief actuary when he retired.

“Our groups are getting betterthan-market concessions on rate caps, no new lasers, no coverage gaps,” he reports. “Everything that’s wrong with an individual stop-loss policy, we’re mitigating all that risk to the employers, giving them a best-in-class experience of being self-funded. We’re allowing them to be selffunded safely for the long term. So, the employers are benefiting.”

It’s also worth noting that under this consortium arrangement, groups cannot be terminated for poor claim performance, and consultants can choose their own cost-containment solutions and not be beholden to a captive’s requirement.

That same value translates for stop-loss carriers that are allowed to essentially view it as a block of business being priced to a mutually agreed-upon target loss ratio, according to Kopcha. Long term, he believes the carriers are protected from any one group member having experienced a bad year.

“Retention rates are higher than 85% on my blocks,” he says.

Benecon’s largest program, the VERIS Benefits Consortium, features more than 1,300 employers across more than 40 states with nearly $600 million of stop-loss. Kopcha says the name combines Latin words for truth and strength – symbolic references to a herculean search for the true cost of healthcare and self-insured risk. In fact, the commitment to cost transparency cannot be overstated at a time when so many employers are seeking alternative risk transfer solutions.

MORE ENGAGEMENT

“What makes a stop-loss group captive so valuable is that it allows small and midsize employers to duplicate the capabilities of a jumbo employer in terms of gaining control over their health benefit costs, determining what is driving expenses, and using underwriting gains to lower the stop-loss attachment point,” Konrad argues.

“Over time, those capabilities lay the groundwork for consistency with regard to claims experience. An ability to get back money in a good or bad year makes a stop-loss group captive particularly attractive,” he notes. For that reason, he believes employers are more engaged in a captive than in a consortium because they will see tangible results.

When stop-loss premiums soar for a decent-sized company of 600 to 1,000 lives with some cash flow that experiences a year or two of bad claims, he says they have no choice but to absorb the increase. But a 50 or 100-life employer with large claims that’s part of a group stop-loss captive will avoid a monster renewal because the entire block

that’s being underwritten is more predictable. In essence, they’re only on the hook for any amount up to their deductible. There’s also the benefit of aggregate accommodation.

“Whether I have a good or bad year, I know that my renewal is going to be tolerable,” Konrad says.

With a stop-loss group captive, there’s no fretting about the member hitting its attachment point and depleting funds or incurring an ag claim. If the captive is managed and underwritten well enough with thoughtful vetting of prospective members, then he says everyone should get back at least one month’s worth of stop-loss premiums.

Since the Affordable Care Act (ACA) was enacted in 2010, he says most captive managers and underwriters structure the arrangement so that a single policyholder shares in the spoils no matter how well or poorly the captive performed in a given year, unlike the salad days of captives. The vehicles he’s been involved with have returned anywhere from 8% to 15% on average. “It’s found money,” he adds.

Konrad’s entry into captives involved self-funded workers’ compensation coverage, noting that there wasn’t much opportunity in the group captive space for accident and health coverages, especially employee

benefits, until the ACA became law. He cites a compounded annual growth rate of about 12.5% or higher in group stop-loss captives since then, the majority involving small and middle-market self-insured employers.

Most captives allow self-funded members to pick their own thirdparty administrator and provider network, as well as whether to adopt reference-price pricing, he says. In addition, choosing a pass-through or transparent pharmacy benefits manager as part of a captive will enable the group to recover 95% of 100% of prescription drug rebates, he explains, whereas that’s not the case in a fully insured or level-funded program.

Another consideration in the stop-loss group captive space worth mentioning is the possibility of building a captive outside of a pool of employers that absorbs any laser liability. “I’ve done that in the past for a group of 75 to 80 schools in a group captive that never has lasers, because if there is a laser opportunity, the other captive that sits behind the pool will absorb that cost since they have so many reserves from being in these pools,” he explains.

Pondering what’s next for stop-loss group captives, Konrad quips: “I got to wear sunglasses every day because this future is so bright for captives. Here’s the reason I say this: I sent an email to a large producer that predominantly has a big, long-standing, fully insured and level-funded book who said the size of his book and the size of his average client shrunk, and we are having the opposite experience.”

Bruce Shutan is a Portland, Oregon-based freelance writer who has closely covered the employee benefits industry for nearly 40 years.

A MARKET UPDATE FOR “MEC” PLANS

IfIWritten By Laura Carabello

MEC is not in your lexicon of healthcare acronyms, it’s time to add it to your glossary.

The requirements for Minimal Essential Coverage (MEC) plans remain an important consideration for selfinsured employers despite Congressional turmoil regarding enhanced subsidy expiration in 2026 for plans offered under the Affordable Care Act (ACA). Core financial assistance, the basic subsidies, are not ending. But a decision to sunset the “enhanced subsidies “that were added during the pandemic to make coverage even more affordable has been a continual see-saw.

Health policy experts caution that changes to the enhanced subsidies could destabilize the insurance marketplace by encouraging healthier people to opt out of ACA-compliant plans, leaving a risk pool tilted toward sicker individuals. This could lead to rising premiums that impact plan sponsors, with fewer affordable options for those who need comprehensive coverage.

MEC plans are available and more important than ever in the current, turbulent market. MECs are a type of health insurance plan that satisfies the ACA requirement for health coverage. It may sound simplistic, but the complex requirements merit the attention of employers – large and small -- to understand MEC and comply with its associated mandates for affordability and minimum value (MV) in order to serve employees and avoid specific financial penalties.

A small business with 50 or more full-time or full-time equivalent employees (those working 30+ hours a week) is recognized under the ACA as an Applicable Large Employer, or ALE. MEC refers to a health plan that provides basic health benefits, primarily focusing on preventive and wellness services, to satisfy the health coverage requirements of the ACA and avoid economic consequences. MEC plans cannot deny coverage or impose pre-existing condition exclusions, ensuring access for employees with pre-existing medical conditions without fear of rejection.

Todd E. Archer, president, Concierge Third Party Administrator, clarifies that certain MEC services go beyond preventive care, “To address consumer demands, though, a lot of MEC plans have expanded coverage to include non-preventive services to include routine office visits, chiropractic, and emergency room visits. Some also include indemnity products for hospitals, accidents and dread diseases.”

The business mandate should not be confused with the individual mandate that many people may remember, which requires individuals to have health insurance to avoid a federal tax penalty. It was rescinded in 2019, although certain states may still require residents to have MEC or face a state-level penalty.

In addition to the plans captured above, examples of MEC include:

• Coverage provided to PEACE Corps volunteers

• Certain veteran health coverage

• Student health plans provided by a college or university while enrolled

MEC plans typically come in three “different strengths”:

• Standard MEC plans are ACA-compliant and include coverage for wellness, preventative services, prescription discounts, and telehealth services.

• Enhanced MEC plans take coverage one step further than standard plans and are aimed at attracting and retaining top talent by also including primary and urgent care visits with low copays and discounted specialist and laboratory services.

• The highest level MEC plans include the enhanced MEC plan benefits along with added coverage such as prescription coverage and low copays.

Source: SBMA Administrators

WHAT’S COVERED UNDER A MEC?

MEC plans are described as "skinny plans" that concentrate on preventive care but typically do not cover major medical expenses like hospitalization, emergency services or specialist visits.

Benefit Management Administrators, Inc. (BMA) reports that there are 63 preventive services covered at 100% under the required government list of Preventive and Wellness Benefits when a member visits a network provider. Services covered include immunizations, blood pressure screenings, diabetes and cholesterol screenings, prenatal visits for pregnant women and more.

Below is a partial list of the covered preventive services for adults, although basic MEC coverage specifically for women also includes preventative services like cancer screenings (cervical, mammograms, BRCA counseling), contraception and STI screenings. Pregnant women have specific MEC benefits such as gestational diabetes screening, anemia screening, folic acid supplements and prenatal care services like labor and delivery.

Covered Preventive Services for Adults

1. Abdominal Aortic Aneurysm one-time screening

2. Alcohol Misuse screening and counseling

3. Aspirin use for men and women of certain ages

4. Blood Pressure screening

5. Cholesterol screening

6. Colorectal Cancer screening

7. Depression screening

8. Type 2 Diabetes screening

9. Diet counseling

10. Hepatitis B screening for people at high risk

11. Hepatitis C screening

12. HIV screening

13. Immunization vaccines for adults (Hepatitis A, Hepatitis B, Herpes Zoster, Human Papillomavirus, Influenza (Flu Shot), Measles, Mumps, Rubella, Meningococcal, Pneumococcal, Varicella, Tetanus, Diphtheria, Pertussis)

14. Obesity screening and counseling

15. Sexually Transmitted Infection (STI) prevention counseling

16. Tobacco Use screening and cessation

17. Syphilis screening for adults at high risk

18. PrEP (Pre-Exposure Prophylaxis – HIV prevention medication for HIV-negative adults at high risk)

19. Lung cancer screening for adults at high risk

20. Statin prevention medication for adults at high risk

21. Tuberculosis screening for certain adults without symptoms at high risk

22. Fall Prevention for adults 65 years and over in a community setting

Archer maintains that there is value to employees who don’t need, want or can’t afford a full major medical health plan.

“Communication is key to making sure the participants understand that they are purchasing a limited benefit plan that does not cover everything a major medical plan does,” he advises. “For groups with many underserved employees (part-time, low hourly paid and/or seasonal workers), there is definite value.”

He also observes a recent trend among particularly younger workers who are healthy, electing a limited benefit plan as they don’t perceive the need for full major medical benefits with the resulting cost.

“While you could debate the longer-term implications of this decision, it is happening,” he says. “If an employer doesn’t feel like they can afford to continue with the cost of a full major medical plan and wants to replace it with an enhanced MEC plan, the disparity in benefits offered will universally be viewed as having no value. MEC plans are best suited to serve the needs of specific demographic groups and not as a cheap replacement for a true major medical plan.”

Dr.  Jawad Arshad

Nine out of ten healthcare encounters occur outside hospital walls, states Jawad Arshad, MD, FACEP, CEO, UnifyWell, an ACAcompliant plan that helps improve cash flow by decreasing FICA taxes, www.unifywellbenefits. com

“As a physician, I know that to bend the curve on disease, we must eliminate barriers to care, lower medication costs, and focus on wellness,” he says. “We built UnifyWell to bring meaningful access where care truly happens—throughout the outpatient setting.”

Employers can offer the program as a stand-alone benefit for parttime or full-time employees, or as a supplement to an existing group health plan.

“Members receive unlimited, free virtual primary care, urgent care, and counseling, plus free generic prescriptions from local pharmacies,” he explains. “They also enjoy live coaching, group sessions, tailored education, and discounted in-person care for office visits, labs, imaging, dental, and vision.”

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By shifting routine care to this efficient model, Dr. Jawad affirms that this approach reduces employee outof-pocket costs while decreasing claims for group health plans, adding, “Using compliant, tax-advantaged strategies, employers can not only offset 100% of the cost but also save $40–$50 per employee per month in FICA taxes.”

THE DOWNSIDE OF LIMITED COVERAGE

In essence, an MEC plan is a cost-effective way for employers to offer foundational health benefits that meet the minimum legal requirement to avoid a fine, while promoting basic wellness among employees. While MEC plans satisfy the ACA's basic coverage mandate, they may offer only a limited set of benefits, often including just preventive care.

MEC plans can look like a smart cost-cutting move for employers because they’re dramatically cheaper than major medical coverage and still let companies say they “offered insurance.”

Ali Panjwani, founder and CEO, Merit Medicine, cautions, “On a spreadsheet, that’s a win: lower premiums, broader eligibility, and reduced ACA exposure. But the savings shift risk onto employees. MEC often covers only preventive basics, so workers facing real illness or injury are left exposed to crushing bills, delayed care, and medical debt. Over time, which erodes health, productivity, and retention. The people most likely to enroll, lower-wage or higher-risk workers, are exactly the ones who can least afford a thin safety net.”

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MEC plans do not meet the minimum value (MV) standard set by the ACA and may not cover a substantial portion of medical costs, leaving employees with significant out-of-pocket expenses for major healthcare needs. It is important to note that MEC may be insufficient for those with serious health conditions and who anticipate needing more comprehensive medical care.

As a result, employees may be dissatisfied with MEC, which can lead to frustration when they discover that their essential medical needs are not adequately covered, potentially affecting morale and job satisfaction. Finally, MEC plans may have a restricted network of healthcare providers, and employees could find that their preferred doctors or hospitals are not included in the plan’s network, limiting their choices for care.

It’s all part of managing a growing workforce and navigating ACA compliance, which can appear to be overwhelming. It’s not just about avoiding penalties -- it stands as a reflection of the organization’s commitment to employees’ health and well-being, symbolic of an employer’s contribution to raising workforce morale and building loyalty.

What About Costs?

Since MEC only offers preventative coverage, the cost is less than traditional group health insurance. For employers considering MEC plan designs, BMA recommends combining an MEC plan with a limited medical plan. This combination provides additional benefits and is more desirable for employees, with additional benefits that are included but are not limited to discount plans, virtual doctors’ visits, and restricted coverage for routine doctor visits. Depending upon the plan design, it may also offer limited hospital benefits.

Cash-Pay Option

“Employers can offer a MEC plan built around a cash-pay model for routine and preventive services,” says Joey Truscelli, 30-year veteran of the healthcare payment system and CEO of My Patient Global™ .“When employees need a doctor visit, labs, or basic medications, they access pre-set, upfront prices—like a $45 primary care visit—through streamlined cash-pay tools, such as the ones we offer through My Patient Global. Providers are paid directly and immediately, eliminating claims, lowering administrative costs, and keeping the MEC affordable. Cash-pay brings clarity, speed and real cost control to MEC programs—and everyone benefits.”

Archer weighs in on the topic, “A MEC plan would not, per se, save an employer plan money. It could, however, offer the employer a way to expand the coverage they offer to all classes of their employees on a cost-effective basis. It also usually avoids the employer's shared responsibility and provides the employee with a 1095, which could reduce potential audit risks. It can also help an employer who is struggling to find and keep the employees needed to operate the business in tight labor market conditions.”

What’s Not a MEC

HealthInsurance.org explains that policies that are not major medical coverage and not regulated by the ACA do not count as MEC. However, employer-sponsored "skinny" plans, as noted above, do count as MEC even though they are not major medical coverage.

• Short-term health insurance

• Medical discount plans

• Limited-benefit plans

• Critical illness insurance

• Accident supplements

• Travel medical insurance

• Dental/vision plans

• Family planning Medicaid, tuberculosis-specific Medicaid and emergency-only Medicaid.

• Pregnancy-related Medicaid and medically needy Medicaid may or may not be considered MEC, depending on the state

• Healthcare sharing ministries

• Indian Health Services coverage, although American Indians and Alaska Natives have access to year-round enrollment in the Exchange, with zero-cost-sharing if income doesn't exceed 300% of the poverty level.

Penalties of Non-Compliance

Offering an MEC plan helps employers avoid a major "Part A" IRS penalty: failing to provide any coverage to full-time employees and their dependents (children up to age 26) or offering coverage that does not meet affordability and minimum value (MV) standards.

1. Section 4980H(a) Penalty (“A Penalty”)

Applies if an employer does not offer MEC to at least 95% of its full-time employees (and their dependents). The penalty is triggered if even one employee receives a premium tax credit through the Health Insurance Marketplace.

2025 Annualized Penalty: $2,900 per full-time employee (with the 2026 estimate at $4,480 assuming ~3% inflation), excluding the first 30. An employer with 100 full-time employees who fails to provide coverage will face a penalty calculation like this:

2. Section 4980H(b) Penalty (“B Penalty”)

Applies if an employer offers coverage that is either unaffordable or doesn’t provide minimum value, and at least one employee receives a premium tax credit to purchase their own coverage.

2025 Annualized Penalty: $4,350 per full-time employee receiving the credit. The IRS will only impose the larger of the two penalties, capped at the amount of the “A Penalty.”

Source: ABIG Solutions

Here’s a compendium of recommendations from industry advisors:

• Leverage technology and automation:

o Use software to automatically track employee hours, eligibility, and costs to help ensure compliance and mitigate audit risks.

o Utilize a compliance management system to centralize evidence collection and manage various audit requests.

• Confirm plan and coverage details:

o Partner with an insurance provider to verify that offered plans explicitly meet MEC and Minimum Value (MV) standards.

o Confirm that the plan meets prescription drug coverage standards.

o Regularly review and reassess the plan’s cost-sharing structures to ensure they align with IRS affordability safe harbors.

• Educate and communicate with employees:

o Clearly explain to employees what a plan covers (and doesn't cover) in plain, user-friendly language.

o Educate employees about their healthcare options and how their choices can impact their long-term financial and healthcare well-being.

• Stay informed and seek expertise:

o Stay up to date on any changes to the ACA and related regulations.

o Consult with benefits advisors or legal experts to ensure the plans meet all necessary standards and to help navigate complex requirements.

o Use IRS resources, such as affordability safe harbor checklists and the Minimum Value Calculator, to confirm compliance.

• Establish internal processes:

o Document clear policies and procedures and ensure they are regularly updated

o Provide comprehensive training to relevant staff, such as HR and benefits administrators, on ACA compliance requirements.

o Conduct regular internal audits to monitor compliance and identify any areas for improvement.

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Pairing an Employee Assistance Program (EAP) with an MEC plan can create a more comprehensive and supportive benefits offering.

“While MEC plans provide essential preventive care, they may leave gaps in mental health and catastrophic care coverage,” explains Dani Kimlinger, PhD, MHA, SPHR, SHRM-SCP, CEO, MINES and Associates, Inc. “A top-tier EAP can support these and deliver meaningful value to employees and employers alike. By integrating a high-quality EAP, employees gain access to virtual and in-person therapy sessions at no copay within the EAP’s session model, ensuring timely and affordable mental health support.”

She advises that when major medical events occur, such as surgeries not covered under MEC, the EAP work-life services can assist employees in finding financial resources, sliding-scale care, and community programs to reduce out-of-pocket costs. Additionally,

Advocacy in Action

EAP coaching services, including wellness coaching, can help employees optimize the preventive benefits offered by MEC, improving overall health outcomes and engagement.

“EAP reporting also provides valuable data on how employee needs are addressed, such as whether the presenting issue was resolved within the EAP, referred to the health plan or MEC for further care, or directed to community resources,” continues Kimlinger. “These insights help employers understand the impact of MEC and other health plans, identify gaps and make datadriven decisions about benefit design.”

She says that pairing MEC with EAP creates a layered benefits model that enhances employee well-being beyond basic preventive care and addresses social determinants of health by offering financial guidance, mental health support, and coaching.

“This combination provides measurable outcomes through EAP reporting, strengthening ROI and compliance strategies,” recommends Kimlinger.

MINIMUM VALUE DISTINCTION

MEC is different from MV coverage. It is a separate ACA standard requiring a plan to cover at least 60% of average medical costs and provide substantial coverage for physician and inpatient hospital services. An MEC Plan is NOT Major Medical

and does NOT

as an MV plan as defined by the ACA.

A business can offer an MEC plan that does not meet the MV standard, but this may expose them to a different penalty ("Part B") if an employee gets a subsidized plan through the Health Insurance Marketplace. An MVP must meet both the coverage and affordability test.

The Department of Health and Human Services (HHS) has developed a tool, the Minimum Value Calculator, which helps employers to determine if their health plan provides the "minimum value" required by the ACA. Employers input information about their plan's benefits and cost-sharing features (like deductibles, copayments, and coinsurance) to get an estimate of the plan's value, which will determine if their health plans meet this standard.

Here’s how the IRS explains it:

Under the ACA employer shared responsibility provisions, ALEs must either offer MEC that is “affordable,” and that provides “minimum value” to their full-time employees and their dependents or potentially make an employer shared responsibility payment to the IRS. The employer shared responsibility provisions are sometimes referred to as “the employer mandate” or “the pay or play provisions.”

Even if an ALE member offers MEC to at least 95 percent of its full-time employees (and their dependents), it may owe the

second type ("Part B") of employer shared responsibility payment for each full-time employee who receives the premium tax credit (PTC) for purchasing coverage through the Health Insurance Marketplace also known as the Exchange, which was established by the ACA.

ELIGIBILITY AND PREMIUM TAX CREDITS

If no plan meets the MV and affordability standards, a person may qualify for PTC in the marketplace. The IRS defines the PTC as a refundable tax credit designed to help eligible low- and moderateincome individuals and families afford health insurance purchased through the Marketplace or Exchange. If an employer plan does not meet MV, but an individual enrolls in it anyway, that plan will be considered MEC, and the individual will not be eligible for PTC. The Summary of Benefits and Coverage for a plan must disclose if the coverage is MV.

Beyond the Basics, a project of Washington, DC-based Center on Budget and Policy Priorities, funded by the Robert Wood Johnson Foundation, advises that an individual must not be eligible for MEC to be eligible for PTCs in the marketplace, although there are a few exceptions.

The organization provides training and resources on eligibility guidelines and the enrollment process for health coverage available in the marketplace. It is aimed at navigators, advocates, state and local officials and others who help consumers get and keep their health coverage. They counsel that being eligible for MEC means the insurance is available to the individual, even if they don’t enroll in it. Therefore, people who are eligible for MEC will generally not qualify for PTC.

They caution that MEC should not be confused with MV, a measure of a plan’s comprehensiveness. A person is not barred from PTC due to an employer’s offer of coverage unless the employer offers at least one plan that meets both the affordability and MV standards. An employer-sponsored plan must have an MV of at least 60 percent, meaning that it covers inpatient and physician services and pays at least 60 percent of total medical costs for a standard population to meet the MV standard.

POTENTIAL EXPIRATION OF PREMIUM TAX CREDITS

At the time of this writing, it was uncertain whether the enhanced premium tax credits (PTCs) -- better known as enhanced subsidies-under the Affordable Care Act (ACA) would expire or renew at some level at the end of December 2025.

The battle is entering a new phase of discord between the political parties, with many analysts predicting that without an extension, premiums will more than double on average for roughly 20 million Americans on the ACA marketplaces. The Federation of American Hospitals laments that the expiration of enhanced subsidies will also strain hospitals and increase uncompensated care.

While the expiration of enhanced subsidies does not directly affect employer-sponsored group health plans, NFP, an AON company, cites important downstream consequences for employers subject to ACA compliance.

• Increased Costs for Employees: Employees who currently receive enhanced PTCs through the Health Insurance Marketplace will see significant increases in their premiums starting in 2026. This is because the federal government will no longer cover as much of the cost, or in some cases, the individual will lose eligibility for any help at all.

• Potential Increase in Employer Plan Enrollment: As Marketplace coverage becomes more expensive, more individuals may seek coverage through their employer's plan, including employees who previously opted for Marketplace coverage or those who experience a qualifying event like a COBRA election.

• Increased ACA Compliance Scrutiny: When an employee receives a PTC, it often triggers an IRS letter to the employer to verify whether the employer offered affordable, minimum value coverage. An increase in employees seeking employer coverage or simply navigating the complexities of the new marketplace environment could indirectly lead to more scrutiny of an employer's compliance with the ACA's Employer Mandate.

• Affordability Concerns: The potential for higher costs for employees highlights the ongoing need for large employers to ensure their offered coverage meets the ACA's affordability thresholds, which are adjusted annually by the IRS. For 2025 plan years, the affordability percentage is 9.02% of an employee's household income.

MEASURING VALUE

Judging value also depends upon the employee demographics and needs. Dr. Kimlinger weighs in, “Some of the factors to consider include social determinants of health and the employee population. For instance, employees who are younger, with lower income, may lack the ability to access preventative care, but with MEC, they have access to this, and hopefully, they do not require hospitalization.

She says that those with chronic conditions may require higher medical needs and hospitalization, and therefore, may not find as much value.

“Other considerations include whether employees have higher or lower levels of healthcare literacy,” she continues. “Lower levels of healthcare literacy may lead to undervaluing the preventative care, as it is not paired with education. Telehealth can be a positive factor for employees in rural areas, with unstable housing and transportation.”

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FINAL WORD ON THE MEC OPTION

Offering a health plan that qualifies as MEC is one of the easiest ways for businesses to meet federal requirements, avoid penalties and provide employees with a safety net. MEC plans are an attractive cost management tool, providing a more affordable way to offer health benefits compared to comprehensive insurance plans.

This makes MEC plans a practical solution for businesses with limited budgets or those with variable workforces, like part-time or seasonal employees. They are also flexible, since MEC plans can be used strategically, allowing employers to offer them as a foundational benefit and then layer on other "voluntary" benefits, like dental or vision. Employees then have the opportunity to choose more comprehensive coverage if they wish.

David Konrad, VP Underwriting, Coverys, attests, “An MEC plan, which replaced the mini-med product offered pre-ACA, is very valuable to employees since it provides health coverage. For a parttime employee or an independent contractor to have some healthcare coverage that is affordable and keeps them engaged with their PCs is important for long-term health.”

Speaking of the self-funded version, he says that the MEC option ABSOLUTELY saves money for the employer.

“Most employer-sponsored self-funded health plans are offering MEC or MEC PLUS to their members and are saving a tremendous amount of money compared to the fully insured MEC programs,” Konrad explains. “As a self-funded option, almost all of the deductions/premiums are a variable cost, so the employer only pays up when the cost is incurred. MEC PLUS plans run at < 50% loss ratio, while during the last SIIA meeting I attended, FI and Major Medical SF plans were all > 85% loss ratio.”

He describes the role of the TPA in offering the MEC as keeping administrative costs low and offering a competitive PEPM to adjudicate.

“The role of the broker is also crucial in explaining to the plan members the coverage limits, features, advantages and efficient utilization,” concludes Konrad. “A broker needs to illustrate the savings potential to the selffunded plan’s CFO compared to an FI option or not offering coverage, with the potential for incurring penalties,”

Archer also confirms the role of the broker and TPA in MEC plans, suggesting, “It is the same as it is in a more traditional major medical plan – the setting up, communicating, pricing, administering and servicing of the plan.”

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But the limitations of MEC may not make it ideal for all businesses. Industry observers regard them as best suited for businesses with a young, healthy workforce and those primarily seeking ACA compliance at a minimal cost. For businesses with diverse employee demographics and varying healthcare needs, more comprehensive plans could be a better fit.

When it comes to making a decision about the MEC option, experts concede that careful evaluation of workforce needs is crucial. Ultimately, the decision should align with a company’s goals, financial capacity and commitment to employee well-being. It is prudent to consider consulting with an insurance expert or benefits consultant who can provide guidance tailored to specific circumstances.

“In today’s labor market, benefits are a direct reflection of a company’s values,” emphasizes Steve Suter, president and COO, MacroHealth. “Using an MEC as core coverage sends the wrong message and often leaves employees with significant financial exposure, driving absenteeism, turnover, and higher long-term costs. MECs simply don’t meet the needs of employees with families, chronic conditions, or moderate healthcare usage.

He maintains that they do have a narrow role: serving as a shortterm, compliance-focused bridge for employers navigating financial pressure, seasonal labor models, or predominantly young, healthy workforces.

“Beyond that, MECs become costly, risky and damaging to an organization’s brand and retention," concludes Suter.

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TRUMP ADMINISTRATION PROPOSES NEW TRANSPARENCY REGULATIONS

Editor’s Note: This topic will be addressed in more detail during SIIA’s upcoming Healthcare Price Transparency Forum, scheduled for February 25-26 in Jacksonville, FL. Event details can be accessed at www.siia.org.

AAQuick Refresher on the TiC Regulations

Written By Chris Condeluci, Esq.

Way back in October 2020, the first Trump Administration finalized regulations – known as the “Transparency in Coverage” or “TiC” regulations – requiring self-insured plans and insurance carriers to publicly disclose through three distinct Machine-Readable Files (“MRFs”):

• In-network negotiated (“INN”) rates for covered medical items and services (known as the “INN Rate File”).

• Out-of-network (“OON”) allowed amounts the plan or carrier paid to out-of-network providers (known as the “OON Allowed Amounts File”).

• INN rates and the historical “net price” for covered prescription drugs (known as the “Prescription Drug File”).

These final regulations also require carriers and self-insured plans to provide participants with cost-sharing liability information for medical items and services covered under the plan or policy through an electronic, online tool that can be accessed directly by participants at any given time during the year.

PROBLEMS WITH THE PUBLIC DISCLOSURE OF PRICING INFORMATION

Over the course of the past four years in which the TiC regulations have been effective, self-insured plan sponsors and their service providers have discovered that these MRFs (in particular, the INN Rate File and the OON Allowed Amounts File) are way too large, which has made it extremely difficult for plan sponsors and their service providers to download, analyze, and evaluate the publicly disclosed pricing information. In addition, sponsors and service providers have found that the pricing data input into the MRFs is often incorrect, inaccurate, and duplicative, which has made it almost impossible to develop an accurate picture of the pricing information and provider patterns in a particular geographic region.

Another significant issue is the lack of compliance with the TiC regulatory requirements, which many believe is the root cause of (1) the large-scale size of the INN Rate and OON Allowed Amounts Files and (2) the disclosure of incorrect, inaccurate, and duplicative pricing

data. Many industry stakeholders actually believe this non-compliance is purposeful (especially in the case of insurance carriers that “rent” their provider networks to self-insured plans) and is intended to continue to shroud the full disclosure of pricing information for medical items and services and prescription drugs.

SOUNDING THE ALARM

Over the past four years, self-insured plan sponsors and their service providers have been sounding the alarm about all of the problems noted above, and we have encouraged the Federal Departments to issue new regulations that would improve and strengthen the existing TiC regulations.

ASK, AND YOU SHALL RECEIVE…WELL SORT OF

The Federal Departments listened, and just a few days before the recent Christmas Holiday (on December 19th), they finally issued proposed regulations that are intended to address the problems noted above.

Much to our chagrin, however, these proposed regulations do not include any new enforcement provisions, such as requiring the CEO or authorized representative of an insurance carrier to “attest” to the accuracy of the pricing data included in the carrier’s INN Rate and OON Allowed Amounts Files or increasing penalties for noncompliance, which is something we were expecting. These proposed regulations also do not include specific provisions implementing the Prescription Drug File, which is something we were hoping to see.

SOME OF THE MOST HELPFUL ASPECTS OF THESE PROPOSED REGULATIONS

These proposed TiC regulations are technical and dense at times, so I don’t want to get into the weeds of each and every proposed change to the existing TiC regulations. However, I did want to take a moment to describe what I believe to be the most helpful aspects of these proposed regulations:

FOUR NEW FILES TO HELP PLAN SPONSORS BETTER UNDERSTAND THE PRICING DATA

Over the course of the past four years, the Federal Departments have come to realize that additional information relating to the publicly disclosed pricing data is necessary to promote a fuller understanding of pricing dynamics. In response, the Departments are now proposing to require insurance carriers and selfinsured plans to develop and post four new Files to provide what the Departments are calling “additional context” to the INN Rate File. These new – and separate and distinct – Files include a:

• Change Log File

• Utilization File

• Taxonomy File

• Text File

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CHANGE LOG FILE

This Change Log File must be prepared for each INN Rate File, and each respective Change Log File must identify any changes made to the pricing information in the corresponding INN Rate File since the immediately preceding publication of that INN Rate File.

The Change Log File must take the form of an MRF, and the Change Log File for a particular INN Rate File must be updated and posted quarterly, whether or not there are changes to the corresponding INN Rate File since that INN Rate File was last posted.

The purpose of this new Change Log File is to help patients, researchers, plan sponsors, and policymakers identify changes to the pricing information in the INN Rate File from one reporting period to the next. This will effectively eliminate the need to crosswalk old INN Rate Files with new INN Rate Files to figure out what pricing data may have changed.

UTILIZATION FILE

Self-insured plans and insurance carriers must also develop a Utilization File which would document all items and services covered under the plans or policies represented in the INN Rate File for which a claim has been submitted and reimbursed.

The Utilization File would also include each INN provider – identified by the National Provider Identifier (NPI), Tax Identification Number (TIN), and Place of Service Code – who was reimbursed for a claim for each covered item or service included in the INN Rate File.

The Utilization File must also take the form of an MRF, and this Utilization File must be updated and posted annually.

The Federal Departments explained that the purpose of this Utilization File is to reveal which providers are actively serving participants and delivering covered items and services within a self-insured plan’s or insurance carrier’s network. If a provider appears in a plan’s or carrier’s INN Rate File but does not appear in the plan’s or carrier’s Utilization File, then patients, researchers, plan sponsors, and policymakers may reasonably conclude that that provider, despite having a negotiated rate, has had no recent interactions with that plan’s or carrier’s participants. The Departments also explained that extending this type of analysis to all providers for a plan or carrier’s network

could provide important insights into network adequacy.

TAXONOMY FILE

The proposed regulations would require insurance carriers and self-insured plans to make available a Taxonomy File that includes the plan’s or carrier’s internal provider taxonomy, which maps items and services (represented by a billing code) to provider specialties (represented by specialty code as established by the National Uniform Claim Committee (“NUCC”)) to determine if the plan or carrier should deny reimbursement for an item or service because it was not furnished by a provider in an appropriate specialty.

The Taxonomy File must take the form of an MRF, and the Taxonomy File must be updated and posted quarterly. If there are no changes to the taxonomy that affect the information required to be included in the Taxonomy File in a subsequent quarter, the Taxonomy File would not be required to be updated for that quarter.

The Departments explained that this Taxonomy File would provide transparency into how plans and carriers determine whether to exclude certain provider-rate combinations from an INN Rate File, which will be helpful in eliminating “ghost rates” (discussed more fully below). Requiring the Taxonomy File would also offer plan sponsors and researchers potentially valuable insights into the degree of standardization in mapping used by plans and carriers, and how this varies across different market types. And most importantly, the Taxonomy File would offer new information to potentially guide future rate negotiations between plans, carriers and providers, particularly concerning the scope of reimbursable services by provider type to include in contract discussions.

TEXT FILE

The website of an insurance carrier, a self-insured plan, or a service provider on behalf of a self-insured plan must prominently display a Text File that includes a web link to the internet website that hosts the INN Rate File and the OON Allowed Amount File.

The Text File must also include point-of-contact information, including an up-to-date name, title, and email address for an individual who works for the carrier, plan, or service provider who can address questions and issues related to these MRFs. Note, the point-ofcontact information must also be prominently displayed on the same website that hosts the INN Rate File and the OON Allowed Amount File.

The Text File must take the form of an MRF, and the Text File must be updated not later than 7 calendar days following a change in the point-of-contact information or the URL links.

The purpose of prominently displaying a web link to the website that hosts these MRFs is to make it easier for patients, researchers, plan sponsors, and policymakers to locate the pricing information. The purpose of the point-of-contact information is to allow patients, researchers, plan sponsors, and policymakers to contact an actual representative of the carrier, plan, or service provider who can help in verifying the contents of the INN Rate

File and/or OON Allowed Amount File and respond to requests for assistance related to accessing and utilizing these MRFs.

PROPOSED CHANGES TO THE INN RATE FILE

Organizing INN Rate Files by Provider Network

Insurance carriers and self-insured plans often use the same medical provider network for participants covered under multiple policies and health plans offered by these carriers and plan sponsors. The proposed regulations would require carriers and plans to prepare one File for this particular provider network that may then be used by all of these different self-insured health plans and insurance policies, instead of preparing multiple Files for each and every plan and policy.

The Departments explained that where multiple plans share the same negotiated rates under an umbrella provider network, organizing INN Rate Files by provider network would decrease the size of the Files while also maintaining data integrity. The Departments further noted that this would also reduce the total number of INN Rate Files because there are far more available plans and policies than there are distinct, separately managed provider networks.

Reporting By Product Type

The Departments also propose to require plans and carriers to report the product type (e.g., Health Maintenance Organization (“HMO”) or Preferred Provider Organization (“PPO”)) associated with the coverage option for which data is being reported in the INN Rate File.

The Departments explained that product types dictate the fundamental relationship between the payer and the provider regarding patient access and volume, which are key leverage points in contract negotiations over rates. For example, in instances where HMOs may have narrow networks, providers contracting with such HMOs are likely to see increased patient volume, which may encourage such providers to contract at a lower rate with the HMO than they might with a PPO that is less likely to result in higher patient volume.

Product types also dictate the fundamental relationship between payer and patient, with differences, for example, related to patient choice, cost-sharing responsibilities, and accessibility.

In addition, INN rates for particular covered items and services differ based on product type, so requiring plans and carriers to include the product type for each coverage option in the INN Rate File would reflect these differences.

Enrollment Totals

The proposed regulations would require each INN Rate File to include current numerical enrollment totals, as of the date the File is posted, for each coverage option offered by a plan or carrier that uses the File’s provider network. Such numerical enrollment totals must include the number of participants (including all dependents) in the coverage option offered by a plan or carrier.

Eliminating “Ghost Rates”

One reason the INN Rate Files are so large is due to the inclusion of providers associated with INN rates for items or services they are not likely to furnish (e.g., rates for podiatrists to perform heart surgery).

The proposed regulations would effectively eliminate the public disclosure of these rates (often referred to as “ghost rates,” which are medical prices that are listed for items and services that participants never utilize, and medical providers never furnish, making the pricing data misleading).

Here, plans and carriers would be required to exclude from each INN Rate File (1) the provider and (2) this provider’s INN rate (i.e., the provider-rate combination) for an item or service if that plan or carrier determines that it is unlikely that such provider would be reimbursed for the item or service based on the scope of the provider’s license or area of specialty. To make such a determination, the plan or carrier must use its internal provider taxonomy that is typically used during the claims adjudication process. The proposed Taxonomy File (discussed above) is intended to assist in making determinations to exclude “ghost rates” from the INN Rate Files.

Special Rule for Self-Insured Plans for INN Rate Files

Self-insured plans may allow their service provider to make available a single INN Rate File for each provider network used by more than one self-insured plan. In other words, the INN Rate File may be made available at the “service provider-level” for each provider network used by the self-insured plan, and the INN Rate File could include such information for more than one self-insured plan with which the service provider administers. In cases where the service provider is an insurance carrier that “rents” the carrier’s provider network to the self-insured plan, the INN Rate File shall also include INN rates from the carrier’s policies that use the same provider network as the selfinsured plans.

The goal of this proposal is to reduce the size of INN Rate Files, as well as the number of INN Rate Files. And, to accomplish this goal, it makes sense to allow a self-insured plan to allow its service provider to include plans and coverage offered in different health insurance markets in the same INN Rate File to the extent the self-insured plans and fully-insured plans use the same provider network.

PROPOSED CHANGES TO THE OON ALLOWED AMOUNT FILE

The Federal Departments have emphasized that the transparency of OON payment data is vital for plan sponsors, researchers, and policymakers to analyze healthcare spending, benchmark costs, and inform future policy decisions. The Departments believe that OON pricing data offers insight into actual healthcare expenditures, including a window into the price of an item or service in the context of an arms-length transaction between a provider and a plan or carrier who have not negotiated the rate, and where there is therefore no discount associated with the advantage to a provider of being “in network.”

To this end – and to also address the problem that not enough OON payment data is being publicly disclosed in the OON Allowed Amount Files – the Departments would:

• Require more disclosures of OON payments by lowering the number of claims that must be incurred before the public disclosure requirement is triggered – from 20 claims to 11 claims; and

• Increase (1) the period for reporting OON payment data from 90 days to 6 months and (2) the lookback period for purposes of reporting the OON payment data from 180 days to 9 months.

The Departments would also require insurance carriers and self-insured plans to list out in one File all of the payments for OON services in each health insurance market that are above the newly proposed 11-claim disclosure threshold.

And, similar to the proposed changes to the INN Rate File (discussed above), the Departments would require carriers and plans to report the product type (e.g., HMO or PPO) for the coverage option for which payment data is being reported in the OON Allowed Amount File.

Lowering Claims Threshold Triggering Public Disclosure

In an effort to protect the privacy of health information (and to protect participants from identification based on information disclosed in the OON Allowed Amount File), the original TiC regulations did not require a self-insured plan or insurance carrier to disclose OON payment data in relation to a provider for a medical item or service if less than 20 different claims are filed by that particular provider for the particular medical item or service.

As stated, the proposed regulations would lower the threshold for including claims in the ONN Allowed Amount File from 20 to 11 different claims per item or service in a particular health insurance market.

The Departments also clarify that this 11-claims threshold pertains to the number of claims for a particular item or service, not the number of claims for a particular item or service from a particular provider.

Increasing the Reporting and Lookback Periods

The Departments propose to increase the reporting period from the current 90 days to 6 months and also propose to increase the lookback period from the current 180 days to 9 months. In other words, plans

and carriers would be required to include in their OON Allowed Amount Files allowed amounts and billed charges with respect to covered items or services furnished by OON providers during a 6-month time period that begins 9 months prior to the publication date of the OON Allowed Amount File. In this case, if the OON Allowed Amount File was published on June 30, 2027, the File must include data for the 6-month period beginning on October 1, 2026.

Aggregating OON Data by Health Insurance Market

Self-insured plans and insurance carriers must also report ONN payments and billed charges at the “health insurance market-level,” rather than the “plan or policy-level.”

For example, if an insurance carrier offers four individual market plans, six small group market plans, and eight large group market plans, this carrier would be required to make available three separate OON Allowed Amount Files:

• One File that aggregates the OON allowed amounts across the carrier’s 4 individual market plans;

• One File that aggregates the OON allowed amounts across its six small group market plans; and

• One File that aggregates the OON allowed amounts across its eight large group market plans.

For self-insured plans, the Departments would allow a service provider that administers self-insured plans for multiple plan sponsors to aggregate ALL of the self-insured plans that this service provider administers together, and then aggregate ALL of the OON allowed amounts for ALL of these self-insured plans, and then input ALL of these OON allowed amounts on a single OON Allowed Amount File that each of the service provider’s self-insured plan sponsor clients can post.

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This would mean that a self-insured plan may permit its service provider to include its required OON payments and billed charges information in a single OON Allowed Amount File, along with OON payments and billed charges information from multiple other self-insured plans with which the service provider administers. In cases where the service provider is also an insurance carrier, the OON allowed amount and billed charges information from the carrier’s fully insured plans must not be included.

Reporting By Product Type

As stated, carriers and plans would be required to report in the OON Allowed Amount File the product type to which the OON payment data is associated.

In the Department's opinion, adding a product type to the OON Allowed Amount Files would allow patients, researchers, and plan sponsors to compare how historical provider reimbursements differ based on product type, which would enable more accurate and actionable comparisons so they can understand true market pricing for specific product types.

THE FIDUCIARY ANGLE

Self-insured health plan sponsors are considered fiduciaries under the Employee Retirement Income Security Act (“ERISA”). As an ERISA fiduciary, these plan sponsors must, among other things:

• Make prudent decisions.

• Act in the best interests of plan participants.

• Keep health plan costs low.

• Monitor plan service providers.

If a plan sponsor does not have access to complete and accurate pricing data for the medical items or services and prescription drugs covered under the plan, the plan sponsor:

• CANNOT act prudently and re-negotiate with the plan’s existing owner of the provider network or discontinue the plan’s relationship with this service provider.

• CANNOT act in the best interests of participants because the sponsor cannot consider contracting with an owner of the provider network that is charging lower prices for covered benefits.

• CANNOT keep health plan costs low because the sponsor cannot compare the medical and prescription drug prices paid by the plan with the prices negotiated by a different owner of a provider network that the sponsor may consider contracting with.

• CANNOT monitor plan service providers to make sure their existing owner of the provider network is negotiating the most reasonable rates for covered medical items and services, and prescription drugs.

The bottom line is that a plan sponsor NEEDS access to complete and accurate pricing data to satisfy their ERISA fiduciary duties, and without such access, plan sponsors are exposed to fiduciary liability.

Having said all of that, here are some things that the proposed changes to the INN Rate File would help plan sponsors – as ERISA fiduciaries – do:

• By organizing the INN Rate File by provider network, this should make it easier for plan sponsors to analyze the INN rates of different provider networks to make informed decisions about which plans to offer their employees, potentially favoring provider networks with more competitive pricing, in addition to opening the door for plan sponsors to bring healthcare purchasing decisions in-house through direct contracting with provider groups.

• Similarly, by organizing INN rate information by provider network, this should help service providers advise plan sponsor-clients on provider network selection and cost management strategies.

• When it comes to enrollment totals in the INN Rate File, this should allow plan sponsors to weigh different plan and coverage options to understand their relative influence on the overall landscape of healthcare pricing. This should, in turn, enable plan sponsors to develop analytical models that prioritize INN rates for particular items and services based on the number of individuals covered by the corresponding plan or coverage, thereby focusing analysis on prices with the broadest impact on the insured population.

With respect to the proposed changes to the OON Allowed Amount File, here are some things that plan sponsors – as ERISA fiduciaries – can do:

• With OON allowed amounts tied to product type, plan sponsors may better understand the actual tradeoffs in plan design – not just premiums and network access – but also how much the plan will pay when employees go OON.

• Also, with the inclusion of data on product type, plan sponsors could use historical allowed amounts segmented by product type to evaluate the level of financial protection offered for OON services. For example, a plan sponsor offering a PPO plan could benchmark their OON costs specifically against other PPO plans in the market, rather than a generalized average that includes potentially lower-cost HMOs, and they could use this information to make future plan coverage determinations.

• Plan sponsors can also use this data to benchmark costs, refine benefit designs, and negotiate more effectively with providers and owners of the provider network.

WHAT’S NEXT?

Public comments on these proposed TiC regulations are due February 23rd. It will likely take the Federal Departments six months or more (1) to review the comments and then (2) to finalize the proposed changes, so don’t expect final regulations until at least the 3rd Quarter of 2026, at the earliest.

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Note, some of these proposed changes may themselves change when the regulations are ultimately finalized based on stakeholder feedback. In many cases, however, there are not a lot of substantive changes made to what the Departments actually propose. But stay tuned.

Also, stay tuned for additional guidance and regulations from the Federal Departments on price transparency. We are anxiously awaiting a Transparency 3.0 exercise, within which we will hopefully see guidance or regulations increasing enforcement for non-compliance with the TiC requirements. We are also hopeful that we will see a separate and distinct regulation implementing the Prescription Drug File. Guidance on the Prescription Drug File is long overdue.

Chris Condeluci serves as SIIA’s Legal and Policy Advisor. He can be reached at ccondeluci@siia.org.

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SIIA SIIA MEMBERS

FEBRUARY 2026 MEMBER NEWS

SIIA boasts a very active and dynamic membership. Here are some of the latest developments from member companies and individuals powering the self-insurance industry.

The Phia Group Strengthen Plan Document Compliance Team

The Phia Group, LLC (“Phia”) announced the hiring of Jeannie Comins-Roberts as its new Director of Plan Document Compliance. According to a company statement, Jeannie’s wealth of healthcare administration experience, which includes over 20 years of claims administration, account management, and compliance work in the TPA industry, will be a vital asset in driving forward sweeping enhancements to the PDM service.

Formerly a Director of Client Implementation at Health Plans, Inc. and Director of Client Services & Support at Centivo, Comins-Roberts has garnered holistic expertise in the selffunded industry by working extensively with both TPAs and brokers.

“I’m excited to be part of the launch of PDM 2.0, Phia’s nextgeneration platform designed to make plan drafting faster, smarter, and more efficient,” said Comins-Roberts.

“In working with Jeannie in different capacities for many years, I have always valued her

expertise in self-funded healthcare,” said Adam V. Russo, CEO of The Phia Group. “It is a privilege to now have Jeannie join our team, as she will be a tremendous asset to the development of PDM 2.0.”

Kimberlee Langford Joins Boon-Chapman

Boon-Chapman, a leading independent third-party administrator (TPA), announced the appointment of Kimberlee Langford as Vice President, Medical Management.

With more than two decades of clinical leadership and healthcare risk-mitigation experience, Langford is an accomplished nurse executive known for building high-touch clinical programs that reduce high-cost claims, improve outcomes, and elevate the member experience. In her role

at Boon-Chapman, she will lead medical management strategy, guide population health and utilization initiatives, and strengthen the organization’s ability to deliver cost-effective, evidence-based care solutions for employers, TPAs, and payers.

“Kimberlee brings an exceptional blend of clinical depth, strategic mindset, and heart to this role,” said Kari L. Niblack, President of Boon-Chapman. “Her commitment to improving outcomes while honoring the human behind every health plan aligns perfectly with who we are as an organization. Kimberlee is a transformative leader who elevates teams, strengthens clinical strategy, and drives meaningful, measurable improvements in care delivery. We are thrilled to welcome her to Boon-Chapman and look forward to the impact she will have on our clients and members.”

Langford added, “I’m honored to join Boon-Chapman at a time when healthcare is evolving rapidly. I’m committed to building clinical programs that not only drive savings but also ensure high-quality, accessible care for every member. It’s about generating real, measurable impact by improving outcomes, protecting access to quality care, and creating clinical teams that thrive while serving patients at the highest level.”

Strategic Risk Solutions Appoints New Senior Compliance Officer

Strategic Risk Solutions (SRS), the world’s largest independent insurance company manager, announced the appointment of Sandy Bigglestone as Managing Director/Chief Governance, Regulatory, & Compliance Officer (CGRCO).

In this role, Sandy will provide firm-wide leadership and guidance to ensure the firm’s clients have best-in-class governance procedures in place and are in compliance with various regulations that impact captive owners in various jurisdictions. She will also be closely involved in the recently announced specialized initiative - SRS Titanium - in delivering innovative captive insurance management and consulting solutions for Fortune 500 and other global and complex organizations where governance and regulatory compliance are increasingly important issues for owners.

Based in Vermont, Sandy brings a storied reputation to SRS, having most recently served as the former Deputy Commissioner of the Captive Insurance Division at the Vermont Department of Financial Regulation.

“I have watched Sandy blossom in her role in Vermont and have admired not only her technical knowledge but her grace in leadership. She will be a great fit at SRS, and our colleagues and clients will enjoy working with Sandy,” said Brady Young, Founder and CEO of SRS.

“I’ve known Brady and many others at SRS for years,” said Ms. Bigglestone. “I’m delighted to join SRS and look forward to the opportunity to work with them. It is my hope that my experience in the regulatory space, combined with SRS’ commitment to innovation in the captive industry, will yield great results for the company’s clients in the US and beyond.”

Companion Life Subsidiaries Announce Realignment

Together with its parent, Companion Life Insurance Company, Summit Re has announced plans to realign operations with iiSi, a division of Companion Life Insurance Company. In this move, Summit Re will shift its employer stop-loss (ESL) business to iiSi.

Currently, Summit Re serves both the ESL and the managed care reinsurance markets. iiSi also serves the ESL market.

According to a company statement, realigning Summit Re's ESL resources with those of iiSi will allow Summit Re to focus exclusively on its managed care reinsurance business. Meanwhile, iiSi will gain experienced staff members who not only serve the traditional ESL market but also bring depth in designing and executing ESL risk arrangements with captives, alternative risk programs and health plans to continue expanding in those growing ESL market segments. Each will focus on expanding its respective product offering of the innovative risk solutions that have become the hallmark of its business.

Summit Re President Greg Demars observed, “This is an exciting time for Summit Re, iiSi and Companion Life. Aligning our stop-loss resources and joining forces with those of iiSi will allow Summit Re to focus our full attention on supporting payer, provider and captive clients navigate an ever-evolving healthcare environment. At the same time, this transition strengthens ESL product depth and support, allowing Summit Re to more effectively bring risk management solutions to the managed care reinsurance market and iiSi to more effectively bring risk management solutions to the self-funded market.” ®

iiSi President Jon Anderson added, “This move will allow iiSi and Companion Life to bring additional resources and an even stronger market presence and approach to the traditional, captive, alternative risk and health plan ESL market segments. Clients transitioning from Summit Re to iiSi will continue their longterm relationships with trusted staff members while enjoying a broader and deeper base of support.”

Mark Smidt, Vice President of ESL for Companion Life, noted, “Summit Re and iiSi share core values that have made them trusted partners in the marketplace, which is a key reason this realignment makes so much sense. We fully believe this move will make both Summit Re and iiSi stronger and better able to serve their unique target markets as Companion Life continues to invest in and support both units for continued growth moving forward.”

Cobalt Launches Great Bay Administrators

Cobalt Benefits Group announced the launch of Great Bay Administrators (GBA), a brand that brings Cobalt's renowned service-first approach to self-funded employers, utilizing a major national network.

With Great Bay Administrators, insurance brokers can now offer the same exceptional service quality and client-centric approach they've experienced with Cobalt's established brands (BBA, CBA Blue, and EBPA) to employers across the United States.

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"Our sole accountability is to the employers we serve and the brokers who trust us with their clients. That's been true across our other brands, and it's the foundation we're building GBA on."

"Cobalt's success serving employers in the northeast showed us there's strong demand for our flexibility and service-first approach in other New England states and beyond," said Jim Brown, Chief Revenue Officer of Cobalt Benefits Group. "Great Bay Administrators is our answer to that opportunity. We're taking everything we've learned over 60+ years – our commitment to exceptional service, our dedication to data transparency, our client-first approach – and making it available more broadly."

Northwind Taps Caryn Resnick for Key Health Plan Management Role

Caryn Rasnick has joined Northwind as Vice President, Health Benefits Administration. According to a company statement, Caryn's mission is to help Northwind continue to deliver on its promise to produce better member health and stabilize client health plan costs as it scales operations.

"Northwind has built a strong foundation in pharmacy and clinical innovation," said Rasnick. "I’m thrilled to be part of the next chapter as the organization expands into full-service health benefits administration. The opportunity to build something meaningful, alongside such a talented and collaborative team, is incredibly exciting."

Advancing Business In The Self-Insurance Marketplace.

March 30 - April 1, 2026

New Orleans

Sheraton New Orleans

• Hot Topic Conversations

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Conference Overview, Registration & Sponsorships

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2026 SELF-INSURANCE

INSTITUTE OF AMERICA

BOARD OF DIRECTORS

CHAIRWOMAN OF THE BOARD*

Amy Gasbarro

President

ELMCRx Solutions

CHAIRPERSON ELECT, TREASURER AND CORPORATE SECRETARY*

Mark Lawrence

President

HM Insurance Group

BOARD MEMBER

Blake Allison

Chief Executive Officer

Employers Health Network

BOARD MEMBER

Christine Cooper

CEO

aequum, LLC

BOARD MEMBER

Orlo “Spike” Dietrich

Operating Partner

Ansley Capital Group

BOARD MEMBER

Jeffrey Fitzgerald

Managing Director, SRS Benefit Partners

Strategic Risk Solutions, Inc.

BOARD MEMBER

John Fries

Head Accident & Health NA

Swiss Re Corporate Solutions

BOARD MEMBER

Matthew Smith

Managing Director

Risk Strategies

BOARD MEMBER

Beth Turbitt

Managing Director

Aon Re, Inc.

VOLUNTEER COMMITTEE CHAIRS

Captive Insurance Committee

George M. Belokas, FCAS, MAAA

President

Beyond Risk

Future Leaders Committee

Erin Duffy Director of Business Development

Imagine360

Price Transparency Committee

Christine Cooper CEO

aequum LLC

Cell and Gene Task Force

Ashley Hume

President

Emerging Therapy Solutions®

* Also serves as Director

SIIA NEW MEMBERS

CORPORATE MEMBERS:

Amy Gasbarro President Caribou Systems, Inc. Bloomingdale, IL

Brady J. Bizal

Senior Vice President Stop Loss Captives

Alternative Risk Underwriting Minnetonka, MN

Shay Forbes GM Employer Turquoise Health Lehi, UT

James P. Leroy President Utah Captive Insurance Association St. George, UT

2026 BOARD OF DIRECTORS

Dani Kimlinger CEO & Partner MINES & Associates

Les Boughner Chairman Advantage Insurance

Liz Midtlien

Head of Large Claims Solutions

BCS Financial Corporation

Matt Hayward Office President Ryan Specialty

Jonathan Socko President East Coast Underwriters, LLC

Lucas Reynolds CEO Kongo Richland, WA

Dean Vaden

Executive Vice President of Sales & Marketing

Gulf South Risk Services Houma, LA

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