————— An Industry Perspective —————
Do you know what your benefits broker earns on your account?
Not roughly. Not “they get a commission somehow.” The actual number — what they’re paid, by whom, on which products — and whether that compensation influenced the recommendation your employees are enrolled in right now.
If you don’t know — you’re not alone. Most employers don’t. And that’s not an accident.
The Structural Problem
A question the industry doesn’t want you to ask
Employee benefits is one of the largest expenses most employers carry. For a company with 100 employees, healthcare alone can run $1.5 million a year or more. The broker advising you on that spend is likely your most consequential vendor relationship.
And yet most employers have never seen a bill from their broker.
That’s because in the traditional benefits model, the broker isn’t paid by you. The broker is paid by the carrier — a commission built into the premium rate you pay every month. You never write a check. You never see a line item. The cost is invisible, and for most employers, so is the number.
This isn’t illegal. It’s how the industry was built.
But it creates a problem every employer deserves to understand. When the carrier pays the broker — the broker’s financial interest runs toward the carrier, not toward you. The plan that gets recommended isn’t always the plan that delivers the most value to your employees. It’s sometimes the plan that generates the most compensation for the advisor.
And most employers never know the difference.
The Federal Transparency Mandate
Washington already figured this out
For the past five years, Congress has been systematically dismantling opacity across the entire healthcare system. The message has been consistent: hidden costs in healthcare hurt employers, hurt employees, and need to stop.
Employers are hearing about this constantly — in compliance updates, in HR newsletters, from their attorneys. What most haven’t connected yet is that the same transparency movement applies directly to the broker sitting across the table from them at renewal.
ACA — 2010
Carriers required to spend at least 80–85% of premiums on actual medical care. Hidden administrative margins exposed and capped for the first time.
Hospital Price Transparency — 2021
Hospitals required to publicly post their prices. Employers gained the ability to compare what their plan pays versus what others pay for the same procedure.
No Surprises Act — 2022
Employees protected from unexpected out-of-network bills. Hidden network gaps — previously invisible until a claim arrived — brought into the open.
CAA — 2021, Effective 2022
Brokers required by federal law to disclose their compensation to group health plan clients in writing before anything is signed. The law exists. Compliance has been uneven.
The gap that remains
Congress mandated transparency for hospitals, insurers, and PBMs. They mandated it for brokers too. The difference is that hospital prices are now publicly searchable. Broker compensation is still, in too many cases, a number nobody talks about — buried in a document, disclosed technically but never explained honestly.
The transparency reckoning that has reshaped every other corner of healthcare is now arriving at the broker-employer relationship. The December 2025 lawsuits are not an isolated event. They are the predictable outcome of a system that resisted transparency long after the law required it.
The Hidden Layer
Then come the voluntary benefits
On your core health plan, broker compensation is regulated and subject to the CAA disclosure requirements. But on voluntary benefits — the accident insurance, critical illness coverage, hospital indemnity, and cancer insurance your employees pay for entirely out of their own paychecks — compensation structures are higher, less visible, and until very recently, almost never discussed.
Employees pay those premiums. Employees fund that compensation. And in almost every case, neither the employee nor the employer has ever seen the number.
In December 2025, that arrangement got its first serious legal scrutiny.
December 2025
What the lawsuits say
Schlichter Bogard LLC — the firm that won three unanimous Supreme Court victories and fundamentally reshaped how America oversees 401(k) plans — filed four coordinated federal class action lawsuits targeting the employee benefits industry directly.
The allegations are specific.
Named brokers & consultants
Named employer clientsUnited Airlines · Community Health Systems · LabCorp · Allied Universal
A Pattern Twenty Years in the Making
Two landmark moments. The same firms. The same problem.
New York Attorney General Eliot Spitzer sued Marsh & McLennan — then the world’s largest insurance brokerage — for bid rigging and hidden broker override commissions. Internal emails showed executives instructing staff to steer business to carriers who “pay us the most.” Marsh collected approximately $800 million in contingent commissions in 2003 alone.
Bid Rigging & Hidden Override CommissionsMarsh settled for $850 million. Aon settled for $190 million. Willis North America settled for $50 million. Over $1 billion combined. The industry pledged reform. Contingent commissions — the hidden override payments that incentivized brokers to steer business to the most profitable carriers — were supposed to end. The industry said it had learned its lesson.
$1.09 Billion in Combined SettlementsThe Consolidated Appropriations Act made broker compensation disclosure a federal legal requirement for group health plans. Brokers were required to show clients their compensation in writing before anything was signed. The law was clear. What followed, in too many cases, was a disclosure that became a formality — a number buried in paperwork, a box checked, not a real conversation.
Federal Disclosure Mandate2025
Twenty years after Spitzer. Four years after Congress mandated transparency. Schlichter Bogard files four coordinated federal class actions naming Mercer, Gallagher, Lockton, and Willis Towers Watson. The same firms that were at the center of the 2004 investigation. The problem was never solved. It was managed — until it wasn’t.
Federal Class Action — ERISA Fiduciary BreachThe employers and employees paying those premiums never knew.
And for a long time, this industry counted on that.
The Question That Cuts Through All of It
The lawsuits involve large national employers. The federal mandates were written for large national health plans. But the compensation dynamics they describe — and the transparency requirements they impose — exist at every level of the market. Including companies right here in East Texas that have never heard of ERISA fiduciary duty and have never thought to ask what their broker earns on their account.
One question
When did your broker last show you — in writing, before you signed anything — exactly what they earn on your account? Not at renewal. Not when you asked. Before you signed.
If the answer is never — or if you’re not sure — that is the trust issue.
What every employer should ask their broker today
A broker with nothing to hide answers these questions immediately and completely.
If your company offers voluntary benefits to your employees — accident insurance, critical illness, hospital indemnity, cancer coverage — start here:
- What is your total compensation on our account — base commission, bonuses, and any other payments from carriers or vendors — and can you show it to us in writing?
- On our voluntary benefit products, what are you paid — and has that number ever been shown to us in writing before we enrolled?
- Does our voluntary benefit plan qualify for ERISA’s safe harbor exemption, or is it subject to ERISA’s full fiduciary requirements?
- When did we last run a competitive process to confirm our employees are getting fair value for what they’re paying?
- What is the loss ratio on our current voluntary benefit plans — and how does that compare to the market?
Most employers have never been asked these questions. Most brokers have never volunteered the answers.
Employers deserve better. Their employees deserve better. And the advisors in this industry who have always operated with transparency deserve to work in a marketplace where that integrity is the standard — not the exception.
WardBridge Advisors
We disclose our compensation in writing before any client signs anything.
Not because the law requires it. Because you hired us to work for you — and you can’t evaluate whether we’re doing that if you don’t know how we’re paid. That’s not a policy. That’s how this should work.
Start a conversationCoverage made human.