Missouri’s 103rd General Assembly began on January 8th, and since its commencement, numerous bills have been filed that threaten employer flexibility in health benefit plan design and impact employers’ ability to uphold their fiduciary responsibilities.

Overseen by the Department of Labor, the Employment Retirement Income Security Act (ERISA) clearly defines the fiduciary standards required of the individuals that make decisions related to employer-sponsored health benefit plans. They must:

1. Act solely in the interests of plan participants and beneficiaries;
2. Carry out their duties prudently;
3. Follow the plan documents (unless inconsistent with ERISA);
4. Hold plan assets (if the plan has any) in trust; and
   
5. Pay only reasonable plan expenses.
   

Every ERISA plan must have at least one person identified and accountable for having decision-making power over the health plan’s fiduciary actions. The duty to act prudently, a central theme of ERISA oversight, focuses on the diligence exercised in the processes and evaluations leading to fiduciary decisions. It requires expertise in a variety of areas and the ability to seek the best value on behalf of plan participants. 

Accepting this responsibility, employers invest heavily in the education and training of their internal team and enlist the expert guidance of an array of benefit consultants, actuaries, and clinicians. When selecting an administrative partner, such as a PBM, numerous vendors are thoroughly evaluated, extensive financial modeling occurs, and prices and contract terms aggressively negotiated. 

Benefit managers, HR professionals, executive leaders, and Boards of Directors fully appreciate the seriousness of their fiduciary responsibilities in administering a health benefit plan under ERISA and the potential liability that exists if they are found not to act in the best interest of plan enrollees. Some organizations name an administrative committee or their Board of Directors as their fiduciary, and most require the final approval of fiduciary benefit decisions to be reviewed and approved at the highest levels of the organization before enacted. 

So, it is incredibly frustrating when legislative bodies bring forth bills that directly interfere with an employer's fiduciary responsibility to its plan participants, such as Missouri Senate Bill 45. This bill places the financial interest of independent pharmacists over the financial interest of Missouri employers, workers, and their families. It disregards the commitment and effort undertaken by ERISA plan sponsors to act solely in the interest of plan participants and carry out their duties prudently. On behalf of its members, the BHC has submitted a testimony to the Senate Families, Seniors and Health Committee opposing Senate Bill 45. The testimony outlined BHC’s concerns surrounding reduced pharmaceutical competition, increased costs, and constrained plan management strategies.

While advocating on behalf of Missouri employers, we recognize the difficult challenges faced by brick-and-mortar retailers and empathize with the small independent pharmacies. These are difficult times for most businesses and many families. But it is not the time to pass legislation which favors one business model over another, especially when consumer behavior trends clearly demonstrate a continued and accelerated preference for online and home delivery services. It is not the time to take programs demonstrated to be effective in reducing cost off the table.

We will continue to follow this and other legislation that puts employer benefit plan design at risk and threatens their role as fiduciaries. We welcome your input and engagement—please reach out with any questions you may have or to share your thoughts.