While most contractors out there are honest, it is usually the ones who go from door to door offering help who are untrustworthy. Good contractors do not need to solicit work in this manner.

People knocking on doors usually say they walked by and happened to notice something wrong. They may offer to get the house ready for storm season. If there was a recent storm, they may simply show up and offer to fix something that is clearly damaged.

When falling victim to these scams, homeowners could lose thousands of dollars. In addition to this, the ensuing headaches from paying even more for real repairs or trying to recover money from a con artist complicate the situation. If the homeowner’s insurance does not cover fraudulent repairs, they may never recover the money.

The five worst scams these crooks pull off include the following:

1. Poor work quality — Con artists often use cheap materials if they do any repairs. The work is low quality, and homeowners usually must pay to have the repairs redone.

2. Prepayment — In this type of scam, the contractor asks for a large sum of money upfront. After receiving the funds, they disappear or do very little work.

3. Inflated damage — To increase billable expenses, contractors performing this type of scam may make holes in roofs larger. They may also inflate bills for work that was not done.

4. Phantom damage — In this type of scam, the contractor says there is storm damage when there is none. A dishonest individual may destruct sidewalls or roofs to create damage and then repair it.

5. Deductible payment — Some contractors offer to pay the homeowner’s deductible to gain business. However, this is always a plot to lure homeowners into fraudulent work.

How to avoid scams

Verify a contractor’s license — Most scammers are not licensed. Check with local and state licensing agencies for proper verification procedures.

Avoid door-to-door contractors — Good contractors are usually too busy to go door to door seeking work. Those who offer services in this manner are often desperate for money.

Contact the Better Business Bureau — Search for the contractor on the BBB website or call to ask about complaints. Avoid people with a sketchy history. You can also check Angi.

Demand a contract — Do not sign a contract with blank spaces. Make sure the contract specifies the work to be done, the repair schedule and the detailed prices.

Watch for red flags — Many con artists don’t have references or business cards. They may also be hesitant to give an address. If they do provide one, it is usually a post office box rather than a street address.

Deal with your insurer directly — Do not let a contractor talk to the insurance company alone. It is much better to work directly with the insurer which will survey the damage and decide what repairs are necessary. It is also crucial to have the repairs done by a reputable professional for the work to be covered by the insurance company.

The modern workforce spans four generations, each shaped by different life stages, financial pressures and comfort levels with technology. That means the same benefits message and enrollment experience will land differently depending on who is receiving it. Recent surveys have found benefits satisfaction has slipped, suggesting expectations are rising faster than many programs and communications are evolving.

Benefits are complex, personal and often tied to major life decisions. When communications are too generic or the enrollment process feels frustrating, employees may tune out, postpone decisions or default to last year’s elections even when their needs have changed.

The employers that win on engagement typically do three things well:

• Segment the workforce — Generation, life stage, family status, career stage, location and role
• Offer multiple ways to learn — Digital, live and self-serve
• Make the experience easy — Clear choices, fewer clicks and fast answers

Baby boomers

Boomers are often focused on retirement readiness, health care coverage and protecting income. Many are already of retirement age but choose to keep working. They typically appreciate a personal touch and time to digest information before making decisions.

• Offer live Q&A sessions and phone-based support during enrollment.
• Provide clear comparisons of medical plan costs, networks and coverage.
• Highlight catch-up retirement contributions and step-by-step retirement planning resources.
• Pair complex choices (Medicare coordination, supplemental products and long-term care options) with one-on-one counseling.

Generation X

Gen X employees often juggle competing responsibilities, including kids and aging parents. They tend to value autonomy, straightforward information and tools that respect their time.

• Use concise e-mails and one-page summaries that link to more details as needed.
• Offer self-serve decision tools for health plans, FSAs and disability coverage.
• Emphasize financial protection benefits (life, disability and critical illness) in plain language.
• Provide flexible office hours for short calls, not long meetings.

Millennials

Millennials commonly look for flexibility and benefits that support evolving family and financial needs. They are comfortable with digital enrollment but still want clarity and proof of value.

• Build mobile-friendly enrollment processes with short videos and brief explainers.
• Spotlight flexibility-related benefits such as remote options, caregiving support and paid leave when applicable.
• Promote financial wellness resources, student loan support or budgeting tools if offered.
• Tie benefits to career growth, such as tuition support, certification reimbursement, mentorship and internal mobility.

Generation Z

Gen Z is highly responsive to technology-driven experiences and expects speed, transparency and easy access. They also tend to prioritize mental well-being and want information in short, visual formats.

• Use text message-style reminders, in-app nudges or chat-based help if possible.
• Provide bite-size content like short videos, FAQs and simple “what it covers” flyers.
• Make mental health benefits easy to find and use, including EAP access and digital options.
• Offer guided enrollment portals for those new to employee benefits, including definitions and examples.

Execution

A workable multigenerational strategy does not require building four separate benefits programs. Start by updating how workers access, understand and use existing benefits.

• Survey and listen: Ask employees what they use, what confuses them and how they prefer to receive information.
• Offer “digital plus human”: Keep digital enrollment simple but back it up with real-time support for complex questions.
• Measure what matters: Track participation by benefit type, access methods, call center volume and common questions. Then refine communications year-round.
• Segment by life stage, not just age: Family status, health needs and financial stress often predict benefit priorities better than age alone.

When employees can engage with benefits in ways that fit them best, enrollment tends to rise, confusion drops and benefits become a more visible driver of satisfaction and retention.

The changes in the Consolidated Appropriations Act of 2026 are designed to ensure that manufacturer rebates and other drug-price concessions flow back to plans and self-insured employers, while giving plan fiduciaries better data to evaluate whether PBM contracts actually lower costs.

The goal is for health plans to pass those funds to employer customers as lower premiums as they have in West Virginia after similar legislation took effect there, according to studies.

PBMs contract with drugmakers, pharmacies and payers, and handle formularies, pharmacy networks and claims processing while negotiating rebates and discounts with manufacturers. Critics across the political spectrum argue that PBMs’ incentives can push plans toward higher list-price drugs with bigger rebates, which PBMs have been accused of pocketing. This means employers and employees pay more overall, especially when cost sharing is tied to list price.

Skeptics worry that PBMs will adjust to the legislation by replacing lost rebate-related revenue with administrative fees or other contract mechanisms.

The two core reforms

Rebate and discount pass-throughs — The law requires PBMs to pass through 100% of manufacturer rebates, fees, discounts and other remuneration (excluding “bona fide service fees”) to ERISA-covered group health plans or plan sponsors. In practice, it targets business models in which PBMs retain a share of rebates or embed revenue in “spread pricing.”

The pass-through requirement will apply to PBM contracts entered into, renewed or extended for plan years beginning on or after Aug. 3, 2028. For many calendar-year plans, that effectively means Jan. 1, 2029.

Transparency and reporting — PBMs will have to provide detailed reporting to group health plans at least twice a year, with an option for quarterly reporting upon request.

Reports are expected to include information that helps sponsors understand drug spending and PBM revenue sources such as rebates, fees and spread pricing, plus data tied to formulary decisions. Civil penalties can apply for failure to disclose information and for knowingly providing false information.

What’s in it for employers

A key reason employers and other payers are hopeful is the experience in West Virginia, where state officials reported that a rebate pass-through approach was associated with materially smaller group premium increases in the state’s 2026 small-group and large-group filings.

For 2026, the rebate pass-through mandate cut the average group health plan rate increase to 12.6% from 19.5%, according to data calculated by insurers and published in a report compiled by the West Virginia Offices of the Insurance Commissioner. The pass-through mandate caused one insurer to cut its large-group rates by 3% rather than increasing premiums by 5%.

That said, state results can be hard to generalize because plan design, market competition and underlying claims trends differ.

For employers that purchase group health insurance, the new PBM rules could eventually help reduce prescription drug costs by ensuring that rebates and discounts negotiated by PBMs flow back to health plans instead of being retained by intermediaries.

However, because the reforms do not take effect for several years and PBMs may adjust their pricing models, employers should not expect immediate savings. Employers should also work with us to monitor how their carriers incorporate the new requirements into future pharmacy benefit arrangements.

In a Feb. 24, 2026 letter to the U.S. Departments of Treasury, Labor and Health and Human Services (HHS), the organizations asked the Trump administration to tighten oversight of the law’s independent dispute resolution system. The groups argue that the process, which was designed to settle payment disputes between insurers and out-of-network medical providers, is being manipulated in ways that increase health care costs.

A study cited in the letter found that the IDR process generated at least $5 billion in wasteful spending between 2022 and 2024, including administrative fees and arbitration awards that far exceed typical market rates.

How the No Surprises Act works

The No Surprises Act took effect in 2022 and was designed to protect patients from unexpected medical bills. Before the law, patients could receive large bills if they unknowingly received care from out-of-network providers (for example, an out-of-network anesthesiologist at an in-network hospital).

The law prohibits providers from billing patients for these unexpected charges. Instead, insurers and providers must negotiate payment for the service. If they cannot reach an agreement within 30 days, either side can initiate the IDR arbitration process.

Congress intended the process to serve as a limited backstop for resolving occasional disputes, but it has evolved into something far larger.

Federal regulators originally estimated that about 17,000 disputes would enter arbitration each year. Instead, more than 3.3 million disputes were filed between mid-2022 and May 2025, according to a study published in Health Affairs.

Act is a new cost driver

The Office of the Assistant Secretary for Planning and Evaluation, a division of HHS, issued a report in 2026 that found the act is driving up costs for health plans, payers and patients. It found that:

• About 85% of the disputes that flowed through the system in 2023 involved participants in health plans sponsored by private employers.
• IDR reviewers took an average of 91 days to handle disputes, and some took more than 300 days to close some disputes.
• The reviews cost an average of $445 each.
• The reviewers sided with providers in hospital care cases 80% of the time.
• When reviewers sided with the providers, they awarded significantly higher payment rates. For example: For colonoscopy anesthesia, health insurers paid providers an average of $300 in 2023. When an IDR reviewer handled a dispute involving the procedure, it awarded an average payment of $1,252.

What the coalition wants

Industry analysts say the growing use of arbitration is already creating new affordability pressures for employer health plans and their employees through higher premiums, deductibles and cost-sharing.

In their letter, the groups urged federal regulators to take several steps to restore the arbitration system to its intended purpose.

They recommended that the agencies:

• Strengthen enforcement to ensure only eligible claims enter the IDR process.
• Require arbitrators to explain decisions that deviate significantly from benchmark payment levels.
• Increase transparency around arbitration outcomes.
• Penalize providers that repeatedly submit ineligible claims.

The coalition argues that stronger oversight is necessary to ensure the No Surprises Act continues protecting patients without unintentionally driving up health care costs for employers and their workers.

Simple health insurance is insufficient to carry the load. The loss of a breadwinner’s or caregiver’s financial contribution through death or disability is often devastating.

A recent survey by benefits provider Guardian indicates that families in this category are struggling when it comes to achieving their financial goals. Of those workers surveyed only half believe they would be able to manage if the household lost an income due to death or illness. 

Caught in the middle

Families with incomes significantly above $100,000 per year are generally able to create at least some financial cushion against the possibility of death or disability. They also receive a good deal of advice from financial advisors, accountants and insurance agents in managing their financial affairs.

Working class families – those with incomes below about $50,000 – are often able to access various parts of the social safety net in times of crisis.

The “middle market,” in contrast, must make do without the advantages of the more affluent, with fewer privately owned insurance products and services, and without the same access to the social safety net afforded to working-class families.

Workplace benefits are critical

According to Guardian’s researchers, the middle-market population is overwhelmingly reliant on the quality and breadth of the benefits they receive at work, over and above cash compensation.

Over 80% of middle-market respondents report that they got their health insurance, disability insurance and retirement plan all through their employer.

Meanwhile, six in 10 have no life insurance in place outside of the workplace. This means that the solid majority of working families are relying entirely on workplace benefits to see them through the death of a family breadwinner.

And in the event of disability ending a breadwinner’s income, the situation is even more dire: Only 7% of the middle market owns any kind of disability insurance protection, outside of what they can access via their employer.

Are life insurance benefits adequate? 

For young families, the primary role of life insurance is to replace the income of a deceased breadwinner. But many employers cap life insurance benefits at $50,000 — the maximum figure that allows employers to deduct premiums as a workplace benefit under IRC 7702.

The actual need for many of these families is several hundred thousand to a million dollars, and occasionally more. That’s what it takes to replace the income of a worker who earns $50,000 to $100,000 per year until the children are out of college and a surviving spouse is taken care of.

The cap on group life insurance is often not enough to help a family who loses their breadwinner, and the coverage should be considered a stopgap for a more robust life insurance policy purchased in the private market.

What employers can do 

One solution is to offer voluntary benefits to workers. These include a menu of benefits, such as:

• Group life insurance
• Group disability insurance
• Long-term care insurance
• Critical illness coverage

Often, many of these benefits can be offered at little or no cost to the employer.

Premium costs are simply deducted from the worker’s wages and forwarded to the insurance company via payroll deduction. In this way, workers can purchase much more coverage and provide protection for their families – and it doesn’t cost the employer a dime.

In some instances, it can even save on payroll taxes.

To learn more, call us.

According to WTW’s “2025 Absence, Disability and Medical Leave Survey,” caregiver leave is expected to see the fastest growth of any leave benefit over the next two years, despite only a handful of states requiring it by law. The shift comes as caregiving demands intensify across a multigenerational workforce. Many employees juggle work while caring for aging parents, children or other dependents, often with limited financial or workplace support.

Employers are finding that caregiver leave can help reduce stress and burnout, improve morale and productivity and support retention in a tight labor market where replacing workers is increasingly expensive.

What the WTW survey found

• 73% of employers plan to enhance leave programs over the next two years.
• 39% of employers expect to offer caregiver leave within two years, up from 22%.
• Employers cite improving employee experience (67%) and strengthening attraction and retention (60%) as the top reasons for expanding leave benefits.
• 49% of employers identify leave program administration as their biggest challenge, followed by system integration and workforce coverage.

The importance of caregiver leave

Caregiver leave addresses a growing gap for a workforce that increasingly spans multiple generations. Nearly one quarter of U.S. adults are part of the so-called “sandwich generation,” caring for both children and aging parents, according to another report. These employees often provide about 20 hours of unpaid care per week and may spend $10,000 to $11,300 a year out of pocket to support family members.

Although caregiver leave may qualify under the Family and Medical Leave Act (FMLA), it is typically unpaid unless employers offer wage replacement. That financial strain can increase stress and burnout, pushing some caregivers to reduce their hours, change jobs or leave the workforce entirely.

From a business standpoint, caregiver leave can help mitigate turnover risk. Replacing an employee can cost about 30% of annual pay. While caregiver leave will not eliminate turnover, it can lower the risk that employees leave because of caregiving responsibilities.

How employers can implement caregiver leave

Employers considering caregiver leave often start by integrating it into their existing leave or paid time off structures.

Common approaches include offering a defined number of paid leave days per year, allowing caregiving use of banked personal time off or layering caregiver leave on top of state paid family leave programs.

Best practices include:

• Defining caregiving broadly to cover children, parents, spouses, domestic partners and other dependents.
• Coordinating caregiver leave with FMLA and state programs to avoid duplication and ensure compliance.
• Setting clear eligibility and documentation standards while keeping the process simple for employees.
• Training managers to handle workload planning and employee conversations.

Overcoming administrative and operational challenges

Administration remains one of the biggest barriers to expanding caregiver leave. Challenges include coordinating multiple leave programs, maintaining multistate compliance and managing staffing as leave usage increases.

To address these issues, many employers are:

• Outsourcing leave administration to specialized vendors.
• Standardizing policies and systems across locations.
• Using technology to support routine leave management.
• Monitoring utilization to ensure caregiver leave is accessible and free of stigma.

The takeaway

As caregiving responsibilities continue to affect a growing share of the workforce, caregiver leave is emerging as a practical, targeted benefit that supports employees while helping employers attract and retain talent in a competitive labor market.

Yet many organizations assume that once open enrollment ends and payroll deductions are set, everything will continue to run smoothly. In reality, enrollment changes, life events, terminations, plan switches and billing delays routinely create discrepancies that can quietly cost both employers and employees money.

That’s why it’s important for employers to conduct regular reconciliations of their benefits offerings to confirm that:

• Employees are enrolled in the plans they chose,
• Payroll deductions reflect the correct coverage tier and contribution amount, and
• Carrier billings are accurate.

Key areas of the benefits reconciliation process

Gather information — Reconciliation begins with assembling accurate, matching data for the same coverage period. Employers typically need carrier invoices, payroll deduction reports and enrollment records from their HR or benefits administration system.

Using data from different periods can create discrepancies, so timing matters.

Compare enrollment and invoices — Employers should compare the list of employees and dependents on carrier invoices with internal enrollment records. This step helps identify common issues such as terminated employees still being billed, active employees missing from invoices or dependents incorrectly listed. It also confirms that employees are enrolled in the correct plans.

Verify payroll deduction amounts — Next, payroll deductions should be reviewed in comparison against plan rates and contribution structures.

This includes checking employee-only versus family tiers, employer subsidies and any midyear changes triggered by qualifying life events. Even small per pay period errors can add up over time if left uncorrected.

Investigate issues — Discrepancies are common and do not necessarily indicate a system failure. New hires may not yet appear on invoices, plan changes may not have been processed in time or terminations may have missed the carrier cutoff date.

Each issue should be investigated, corrected and communicated to the appropriate party — whether that is payroll, HR or the carrier.

Document findings and resolutions — Finally, employers should document findings and resolutions. This may involve adjusting future payroll deductions, requesting invoice credits or corrections from carriers or updating enrollment records.

Clear documentation creates an audit trail and helps prevent recurring errors.

Reconciliation protects firms and staff

Regular reconciliation protects budgets by preventing “premium leakage” — paying for coverage that no longer applies or deducting insufficient amounts from employee paychecks.

For example, if an employee is terminated and not removed from enrollment in a timely manner, the company will be held financially responsible for paying 100% of benefit premiums. Reconciliation would catch this issue.

Reconciliations also help mitigate potential legal issues and reduce the risk of employee dissatisfaction when errors surface months later and large corrections are required. From a governance perspective, reconciliation supports data integrity and financial accuracy across HR, payroll and finance functions.

Best practices for employers

Conduct regular audits — Monthly reconciliation is widely considered a best practice, especially for medical, dental and vision plans.

Use automation wisely — Many employers now use payroll or benefits administration tools that automate comparisons between enrollment, deductions and invoices, reducing manual work and improving accuracy.

Consider third-party support — There are vendors that specialize in benefits reconciliation and invoice auditing. These services can be valuable for organizations with multiple carriers, frequent employee changes or limited internal resources.

Include COBRA and other benefits — Reconciliation should extend beyond active employee plans. Employers should also confirm that COBRA participants are billed correctly and that voluntary and ancillary benefits are handled with the same discipline.

At the same time, health insurers can no longer shift additional costs to employers and employees through higher deductibles or narrower networks.

Instead, many insurers are pursuing structural changes designed to control long-term costs while improving care quality and member experience.

Interviews with health plan executives and recent industry reporting point to a common theme: reducing avoidable care, simplifying administration and investing earlier in health to prevent expensive problems later.

Employers and their staff can benefit from these strategies, which are increasingly being built into plan design, provider networks and care management programs that influence both premiums and employees’ out-of-pocket costs.

Preventive and personalized care

A central focus for many insurers is expanding preventive care and making it easier for enrollees to engage with their providers before health issues worsen. Executives at plans such as Humana and Highmark Wholecare, in a recent roundtable with the news website Becker’s Payer Issues, emphasized coordinated care models that connect primary care, specialists and support services around the individual.

These models rely on data and digital tools to identify care gaps early, such as missed screenings or unmanaged chronic conditions. Members may receive targeted reminders, care manager outreach or digital coaching to stay on track. For employers, this approach can translate into:

• Fewer high-cost claims tied to late-stage disease
• Fewer avoidable hospitalizations
• Fewer emergency department visits

Employees benefit from clearer guidance, easier navigation of benefits and more proactive outreach instead of reacting to health issues once they become serious and costly.

Cost containment through innovation and collaboration

Insurers are increasingly rethinking how care is paid for and delivered. Many are expanding value-based payment arrangements that reward providers for keeping patients healthy rather than paying for higher volumes of services.

Under these arrangements, insurers and providers share data and align financial incentives around outcomes and the total cost of care.

Plans are also using predictive analytics and artificial intelligence to identify members at higher risk of complications and intervene earlier through care coordination, remote monitoring or alternative sites of care.

For employers, this can help slow medical cost growth over time without eroding access to care for their employees.

Administrative efficiency and transparency

Health plans are investing in modernized claims systems, real-time eligibility and claim validation and more streamlined prior authorization for routine or evidence-based care.

Some plans are reducing or reforming prior authorization requirements where data shows little value, while using technology to make remaining reviews faster and more predictable. Insurers are also working to improve transparency around costs and benefits, helping members better understand service costs and coverage before care is delivered.

For employers, lower administrative costs can help moderate premium growth and reduce HR workload tied to billing disputes and employee questions. Employees may benefit from fewer delays, clearer explanations of benefits and less confusion when accessing care.

What this means for employers

While no single initiative will eliminate health care cost pressure, insurers argue that combining preventive care, value-based payment and administrative simplification offers a more durable path forward.

Employers evaluating plan options may want to work with us to assess how their carriers are implementing these or similar strategies and how they measure success.

These class action lawsuits typically allege that employers exercise sufficient control over these plans to trigger fiduciary duties under the Employee Retirement Income Security Act (ERISA) and that those duties were breached. Once ERISA applies, employers can face claims tied not just to plan design, but to the prudence of benefit selection and monitoring.

If these lawsuits gain traction, they may open a new category of potential liability tied to benefit offerings that many employers have historically overlooked.

At the center of the litigation is the claim that certain voluntary benefit arrangements are not exempt from ERISA, either because they fail to meet the voluntary plan safe harbor or because employers exercise sufficient control to trigger fiduciary duties.

Five areas drawing scrutiny

Four recent class action lawsuits filed against large employers include similar allegations that the employers and their benefits brokers breached ERISA fiduciary duties by allowing excessive commissions, failing to monitor insurers and brokers and engaging in conflicted arrangements within employer-sponsored voluntary benefits programs.

Each of these companies was sued by an employees’ union benefit or welfare plan:

• United Airlines
• Laboratory Corporation of America
• Community Health Systems
• Allied Universal

Key areas of alleged exposure include:

1. Benefits selection processes — Employers are being accused of failing to run competitive requests for proposals, benchmark offerings or document why certain carriers or products were chosen. A casual selection process that keeps the same plan each year can be portrayed as imprudent once fiduciary standards apply.

2.  Contracts — Agreements with insurers, brokers and enrollment vendors are under the microscope. Vague terms, unclear delegation of responsibilities or contracts that fail to spell out fiduciary status can make it harder for employers to defend their role as plan sponsors.

3. Broker and vendor compensation provisions — Embedded commissions, overrides and incentive payments are a central theme in the lawsuits. Plaintiffs argue that employers failed to monitor compensation levels or allowed conflicted arrangements that inflated employee premiums.

4. Premium levels — Even when employees pay the full cost, plaintiffs contend that employers must ensure premiums are reasonable relative to the benefits provided. A lack of benchmarking can be framed as a breach of the duty of prudence.

5. Insurance product loss ratios — Loss ratios are being used as a proxy for value. Low ratios may be cited as evidence that plans were overpriced or structured to favor intermediaries rather than participants.

Steps employers can take

While none of these cases has been decided on the merits, they send the message that voluntary benefits are no longer viewed as litigation-proof. Employers and HR leaders may want to consider:

• Confirming whether each voluntary benefit arrangement is intended to be ERISA-covered or exempt — and documenting that determination.
• Reviewing contracts to clarify fiduciary roles, responsibilities and delegation.
• Increasing transparency around broker and vendor compensation, including commissions and incentives.
• Benchmarking premiums and insurer loss ratios against the broader market.
• Documenting benefit selection decisions and the rationale behind them.
• Strengthening employee decision support and education to demonstrate a focus on participant outcomes.

Voluntary benefits may remain optional for employees, but the lawsuits suggest fiduciary oversight is becoming less optional for employers. Employers that pay closer attention now to ensure compliance with any applicable fiduciary duties can reduce their risk of becoming the next test case.

The shift reflects a growing tension for benefits executives: how to manage soaring GLP-1 demand while preserving affordability, plan sustainability and clinical oversight.

How direct-to-consumer works

Under a DTC model, employees purchase GLP-1 drugs outside the pharmacy benefit on a manufacturer or designated website. Deductibles, out-of-pocket maximums, prior authorization and PBM utilization management requirements do not apply.

While this removes plan-level clinical guardrails, it can materially lower employees’ monthly costs. In many cases, cash-pay prices offered by manufacturers or online platforms are lower than what employees would pay through insurance even after discounts and coinsurance.

Instead of covering GLP-1s as a plan benefit, some employers provide fixed monthly stipends — often $100 to $200 — to offset the cost of direct purchases. This allows employers to cap financial exposure while still offering employees access to treatment.

Drug manufacturers are accelerating this shift. Eli Lilly and Novo Nordisk have expanded DTC programs that allow patients to purchase GLP-1 drugs without using insurance, with monthly cash prices below historical list prices.

Beyond consumer programs, both Lilly and Novo Nordisk are piloting direct-to-employer (DTE) models that bypass traditional PBM structures. In these arrangements, self-insured employers negotiate pricing directly with manufacturers, while third-party administrators handle eligibility screening, prescribing coordination and fulfillment. The goal is to move pricing closer to net cost and reduce employee cost-sharing.

According to the Peterson Health Technology Institute, some employers are evaluating DTC and DTE arrangements because these may offer lower prices than those through traditional pharmacy benefits. They also provide employers with more predictable spending.

However, benefits leaders should view these arrangements as complementary tools rather than replacements for a structured GLP-1 strategy.

Pros and cons

Pros:

• Lower out-of-pocket costs for certain employees.
• Second-chance access for employees who do not qualify under plan rules.
• Predictable employer cost exposure when using fixed stipends or subsidies.
• DTC models typically bypass prior authorization and PBM requirements, reducing friction and administrative delays for employees.

Cons:

• Loss of clinical oversight and utilization controls. Off-benefit purchases bypass prior authorization, step therapy and ongoing clinical management built into the plan.
• Employers lose access to claims data needed to track adherence, safety, effectiveness and long-term cost trends.
• Employees may underestimate their total financial exposure, particularly if they later transition back to plan-based coverage.
• Cash-pay prices can make plan coverage appear inefficient or overpriced, even when the pricing structures are not directly comparable.
• Manufacturer DTC pricing reflects market strategy, not negotiated benefit contracts, and can change or be withdrawn with little notice.
• Once established for GLP-1s, employees may expect similar pathways for other high-cost medications.

What employers can do

For many employers, the most pragmatic use of DTC access is as a secondary pathway. Employees who do not meet plan eligibility criteria can still pursue treatment without forcing employers to broaden coverage in ways that may be financially unsustainable.

As manufacturers continue to refine pricing strategies and employer pilots mature, benefits executives may find that selective use of DTC models offers flexibility in an increasingly complex GLP-1 landscape — provided these pathways are integrated thoughtfully into an overall benefits strategy rather than used as a blunt cost-cutting tool.