By Ashley Trahan, Chief Growth Officer, ClearPoint Health
The Legal Standard That Changed the Conversation
The most important development in employer-sponsored healthcare over the past year was not another transparency regulation, a new PBM pricing controversy, or even the growing financial impact of GLP-1 medications.
It was a legal standard.
In December 2025, Schlichter Bogard filed a series of class action lawsuits against several major employers, including United Airlines, Community Health Systems, Universal Services of America, and Laboratory Corporation of America Holdings. The lawsuits also named several of the largest consulting and brokerage firms in the industry — including Arthur J. Gallagher & Co., Mercer, Lockton, and Willis Towers Watson — as co-defendants for alleged self-dealing tied to voluntary benefit arrangements.
The allegations themselves were serious but not unprecedented. Plaintiffs argued that employers and advisors failed to prudently oversee compensation structures, vendor relationships, and plan-related transactions involving parties in interest. While the lawsuits themselves are significant, the broader importance lies in the legal environment they entered into.
Earlier that year, the Supreme Court’s decision in Cunningham v. Cornell University materially lowered the threshold for prohibited transaction claims to survive dismissal. Plaintiffs no longer need to prove actual harm or demonstrate fiduciary imprudence at the pleading stage. They now only need to plausibly allege that a transaction occurred involving a plan and a party in interest.
That shift may sound procedural, but its implications are substantial. Because modern health plans rely heavily on parties in interest — including consultants, brokers, TPAs, PBMs, stop-loss carriers, analytics firms, clinical vendors, and navigation platforms — nearly every employer-sponsored health plan now operates inside a materially more exposed fiduciary environment.
Healthcare Is Entering Its “401(k) Litigation” Era
The healthcare industry is beginning to experience the same fiduciary evolution that reshaped the retirement plan market over the past two decades.
The 401(k) industry did not fundamentally change because employers suddenly became careless. It changed because courts began expecting employers to demonstrate a prudent, documented process around fee evaluation, vendor oversight, and fiduciary governance. Eventually, that scrutiny reshaped the market itself. Benchmarking became standard, governance committees matured, fee disclosures expanded, documentation practices tightened, and operational oversight evolved from a periodic exercise into a continuous governance function.
Healthcare is now entering the same cycle, only with significantly larger spend and far less transparency.
For years, most employers have governed healthcare primarily through annual renewal cycles. Plans are marketed periodically, benchmarked periodically, and adjusted periodically, despite healthcare representing one of the largest financial exposures on the balance sheet for many organizations.
At the same time, the operational ecosystem surrounding health plans has become extraordinarily fragmented. One vendor administers medical claims, another manages pharmacy benefits, another oversees utilization review, another negotiates provider contracts, and another evaluates the performance of all the above. In many organizations, no single party maintains operational accountability for how the entire ecosystem functions together.
That fragmentation is becoming a fiduciary issue.
Why Most Employers Are More Exposed Than They Realize
Delegation itself is not inherently problematic, but fiduciary responsibility does not disappear when operational responsibility is outsourced. If anything, the need for oversight increases as complexity increases.
Historically, employers could reasonably rely on periodic reviews and external advisory relationships as evidence of prudence. Annual stewardship meetings, benchmark reports, and consultant recommendations often served as the operational backbone of healthcare decision-making. That standard is evolving rapidly.
The modern fiduciary environment increasingly expects employers to demonstrate ongoing operational oversight – not simply annual renewal management. Employers are now under greater pressure to document:
- How vendors were selected,
- How compensation was evaluated,
- How performance is monitored,
- How clinical risk is managed,
- And how fiduciary decisions evolve over time.
This is where many employers are more exposed than they realize.
Most organizations cannot currently produce a clear operational narrative explaining why every major health plan vendor was selected, what compensation structures exist across the ecosystem, what alternatives were evaluated, or how vendor performance is continuously monitored. That becomes particularly problematic in a litigation environment increasingly focused on process rather than outcome.
The question plaintiffs are beginning to ask is no longer simply whether a plan cost too much. It is whether a defensible governance structure existed to ensure fiduciary prudence in the first place.
Those are fundamentally different questions.
The Shift From Financing Vehicle to Governance Structure
Historically, captives were positioned primarily as financial structures focused on underwriting flexibility, renewal stabilization, and long-term cost management.
Those advantages still matter, but the market is increasingly moving toward something broader: governance-oriented health plan structures capable of demonstrating continuous operational oversight.
That shift matters because employers are now operating in an environment where fiduciary scrutiny increasingly focuses on process, accountability, transparency, and documentation — not simply financial outcomes alone.
The employers best positioned for the next era of healthcare litigation are unlikely to be the employers that simply spend the least. They are more likely to be the employers capable of demonstrating a prudent, measurable, and continuously governed oversight process behind every major health plan decision they make.
That requires infrastructure, not just annual reporting.
What Defensible Healthcare Governance Actually Looks Like
Increasingly, sophisticated employers are looking for health plan structures capable of creating stronger governance alignment, operational accountability, recurring oversight, and retained documentation across the entire health plan ecosystem. This is one of the reasons governance-focused captive environments are beginning to gain traction.
When structured appropriately, captives can create more coordinated oversight frameworks by aligning incentives, centralizing governance, improving transparency, and establishing recurring operational review processes across participating employers and vendors. Rather than functioning solely as financial vehicles, these structures increasingly operate as governance environments designed to support ongoing oversight, accountability, and fiduciary defensibility.
At ClearPoint Health, that philosophy shaped the broader governance framework supporting participating employers. The objective was not simply to create another funding model, but to help employers build a more defensible and continuously governed healthcare environment.
ClearPoint Health helps employers manage:
- Vendor fee and compensation transparency
- PBM rebate and pricing oversight
- Claims audit and adjudication governance
- Fiduciary committee documentation
- Healthcare benchmarking and reporting
- Stop loss contract transparency
- Data ownership and reporting access
- Vendor performance monitoring
- Clinical cost management alignment
- Annual fiduciary review support
Taken together, these structures reflect a broader shift occurring across employer healthcare.
The market is moving away from passive health plan administration and toward continuous healthcare governance.
That is no longer simply a funding conversation. It is increasingly becoming a fiduciary one.
The Question Every Plan Sponsor Should Now Ask
The December 2025 lawsuits are unlikely to be isolated events. They represent the early stages of a broader transformation in employer healthcare governance, one that will likely reshape how benefits are purchased, monitored, documented, and defended over the next decade.
The organizations that adapt first will likely stop viewing healthcare exclusively as an annual insurance purchase and start treating it as a governed financial and fiduciary system requiring continuous oversight infrastructure.
If your organization were asked tomorrow to produce a documented fiduciary narrative around every major health plan decision made over the last 24 months, could you?
Could you clearly explain:
- why vendors were selected,
- how compensation was evaluated,
- how performance was monitored,
- how clinical risk was governed,
- and how fiduciary oversight was documented continuously over time?
Most employers assume they can.
Far fewer actually can.
Because ultimately, the question is no longer whether employers intended to act prudently. It is whether they can prove they had a prudent process behind every major decision they made.
Increasingly, a governed captive structure may become one of the most defensible ways to do exactly that.
