Open Sourcing Health Rosetta's Advisor RFP: Revolutionizing Employer Health Plans

At the heart of Health Rosetta's mission is the belief that transparent, ethical, and effective health plans are essential for the well-being of employees and the financial health of employers. To support this mission, we are excited to announce that we are open-sourcing our Advisor RFP (Request for Proposal) at RosettaFest. This initiative is a significant step towards democratizing healthcare procurement and ensuring employers have the tools they need to select benefits advisors who are truly aligned with their interests.

"None of us is as smart as all of us" -Ken Blanchard

The Importance of the Right Advisor

The image of Curly from City Slickers saying, "There's one thing. Just one thing. You stick to that and the rest don't mean $hit," perfectly encapsulates our approach. Employers often ask Health Rosetta , “Where do I start?” The answer is simple: begin with a properly aligned benefits broker or advisor. This is the most crucial step in establishing a health plan that is both cost-effective and beneficial for employees.

The Fiduciary Duty Risk

Many employers are unaware of the severe fiduciary duty risks they face following the Consolidated Appropriations Act of 2021. The Act requires employers to report all direct and indirect compensation going to their brokers. Unfortunately, most benefits consultants have not informed employers about these risks, leaving them vulnerable to legal repercussions.

Marshall Allen's 2021 ProPublica article highlighted the impact of this new law. The article described the shock employers feel when they discover the myriad ways their consultants are making money, comparing it to "the business equivalent of finding out your spouse was cheating on you." This revelation underscores the importance of transparency and the need for employers to understand the compensation structures of their advisors.

The Legal Landscape

The central issue in two ERISA fiduciary cases at the Supreme Court, both won unanimously in favor of employees, was broker compensation. The same law firm that secured these victories is now targeting 21 companies for potential ERISA violations related to health plans. Already, two cases have been filed, including a high-profile suit against Johnson & Johnson over failures in drug procurement. These legal challenges highlight the critical need for employers to choose advisors who are transparent and free from conflicts of interest. The benefits consulting firm in the J&J case is reputed to make over $500 million administering PBM contracts that the J&J complaint shows them paying over $10,000 for medications available for $80.

Health Rosetta's Battle-Tested Model

Health Rosetta's approach involves rigorously testing procurement, contracting, and data access technologies before open-sourcing them for the entire industry. By doing so, we aim to set new industry standards and provide employers with the tools they need to hold their advisors accountable.

We are now making our Advisor RFP template available for public comment and will officially open-source it at RosettaFest. This template has been refined over several years and is ready to help business groups and employer organizations navigate the complexities of selecting the right benefits advisor.

The Open Source Resources Cycle

The open-sourcing of our Advisor RFP is part of a broader cycle of resources we are making available. Using the coming PBM Field Guide as an example, it includes:

1. Template Open RFP: A mechanism for collecting information from PBMs (Pharmacy Benefit Managers) with verification of responses.
2. Standard Contracts, Key Terms, & Plan Graders: Tools to set expectations for accountability and confirm terms.
3. Standard Criteria & Scoring: Guidelines for assessing responses and terms against expected answers.
4. Data Use Standards: Practices for reporting, measuring performance, benchmarking, and holding vendors accountable.

Acknowledging Our Contributors

"No matter who you are, most of the smartest people work for someone else." - Bill Joy

We would like to extend our heartfelt thanks to Eric Krieg at Risk International Benefits Advisory, David Contorno at E Powered Benefits, Joshua Jeffries at Risk Strategies, Tom Emerick at Edison Healthcare , and Brian Uhlig at Alera Group for their invaluable contributions to the development of the Advisor RFP template.

We're grateful for the hundreds of #HealthRosetta Advisors who have battle-tested the Advisor RFP and the employers who have adopted this resource to fulfill their fiduciary duty.

The Rationale Behind Open Sourcing

As outlined in our thought piece on the rationale for open-sourcing , the U.S. healthcare system, metaphorically called "Healthcareistan," is governed by complex legal documents that often prioritize the interests of a few over the many. By democratizing these documents, we aim to shift the balance of power back to employers and employees.

Open-sourcing the Advisor RFP is a step towards reducing the estimated $1.5 trillion in annual healthcare waste identified by the National Academy of Medicine and PwC. This waste is codified in legal documents that create financial toxicity for employers and employees alike. By providing transparent, accessible resources, we hope to help employers avoid these pitfalls and build high-performance health plans.

The Impact on Employers

For employers, using the Advisor RFP template is a game-changer. It provides a clear framework for selecting benefits advisors who are transparent, ethical, and aligned with their goals. This tool empowers employers to make informed decisions, avoid conflicts of interest, and ensure their health plans are designed to deliver the best possible outcomes for their employees.

Conclusion

Open-sourcing Health Rosetta's Advisor RFP is more than just a new resource—it's a revolution in how employer health plans are managed. By leveraging this tool, employers can ensure they are working with advisors who are truly aligned with their interests, leading to better health outcomes for employees and significant cost savings. We invite all employers to take advantage of this powerful resource and join us in transforming the healthcare landscape.

"Given enough eyeballs, all bugs are shallow." - Linus Torvalds

The whole point of open sourcing is to tap the smartest minds. Taking inspiration from the inventor of the operating system that powers most of the Internet, we hope you find flaws and gaps that will improve this living document. Please see, use and comment on the Advisor RFP template. Together, we can build a better, more transparent healthcare system for everyone.