The F-Word in Healthcare: Fiduciary Responsibility & Compliance Challenges

The Compliance Wake-Up Call for Employers

Fiduciary responsibility in healthcare is becoming a front-page issue, and employers need to pay attention. Recent lawsuits—like the one against Johnson & Johnson—are a wake-up call, signaling that plan sponsors must take their fiduciary duties seriously. The Consolidated Appropriations Act (CAA) has reinforced these obligations, introducing reporting requirements and increasing scrutiny on plan sponsors and TPAs.

I recently sat down with Phil Harrison from Healthcare Reporting on The Justin Burgess Podcast to break down what fiduciary responsibility really means for employers and brokers. Here are some key takeaways from our discussion:

? Fiduciary Responsibility Isn’t New—But It’s Changing Many employers assume fiduciary duties only apply to retirement plans, but ERISA holds health and pharmacy plans to the same standard. The CAA has intensified oversight, requiring plan sponsors to ensure their health plans are cost-effective, transparent, and aligned with participants' best interests.

? RxDC Reporting, Mental Health Parity & Compliance Risks Employers must now report key data under RxDC Reporting, ensure mental health benefits are on par with medical benefits, and disclose compensation structures. These obligations aren’t just check-the-box exercises—failing to comply can lead to serious financial and legal consequences.

? Why Employers Need to Take Ownership of Their Data Too often, employers rely on TPAs and PBMs to handle compliance without reviewing the data themselves. Fiduciaries have an obligation to understand what’s happening with their health plan dollars. Accessing and analyzing claims data can reveal hidden costs, unnecessary markups, and opportunities for smarter plan design.

What Employers Can Do Right Now

1?? Establish a Fiduciary Committee – Involve HR, finance, and operations leaders to oversee plan decisions. 2?? Demand Transparency from Vendors – Ask for detailed reporting on costs, rebates, and network adequacy. 3?? Audit Your Plan & Contracts – Ensure compliance with the CAA and protect against legal exposure.

Employers who take a proactive approach now will be better positioned to navigate the evolving compliance landscape and avoid becoming the next headline.

?? Want the full conversation? Check out my latest podcast episode featuring Phil Harrison for an in-depth discussion on fiduciary duties and compliance.

What steps is your organization taking to stay compliant? Drop a comment or reach out—I’d love to hear your thoughts.