Group health plan costs are rising, the data is available, and most employers will do nothing differently at renewal, according to Adam Russo, co-founder and CEO of The Phia Group in Canton, Massachusetts, citing a pattern he has watched repeat for 26 years.
Speaking with Insurance Business Benefits following the release of the firm's 2026 broker survey - which found sweeping gaps in fiduciary preparedness and plan visibility - Russo makes the case that the tools to fix it already exist, and that the only thing missing is the will to use them.
"I use Einstein's definition of insanity," said Russo. "In 26 years of being in this industry, I have seen nothing change when it comes to proactively educating and identifying - from the broker standpoint - one, two, three small things that we could do that will have a profound effect both on lowering overall cost and increasing quality outcomes."
Russo's sharpest critique is aimed not at the data (because employers increasingly have it) but at what happens in the room when brokers and plan sponsors actually meet.
The typical annual renewal, he suggests, is a performance of inevitability. Premiums go up. Copays rise or benefits shrink. No one opens the claims data. No one runs a workshop on how the plan actually works. No one tells employees that going to urgent care costs them nothing while an emergency room visit costs $250.
He also says that some facilities are billing as urgent care while operating as emergency rooms and charging accordingly; an issue highlighted in a 2017 report from United Health Group and in 2024 by NPR.
"In the one-hour annual meeting you have on your health plan, does the HR department talk about the new opportunities to save money, the new opportunity for patients to become consumers of healthcare?" Russo said. "They spend that hour telling people: here are your plan options, bronze, silver, gold, platinum. Here's how much money is going to come out of your account. We're still with network XYZ."
The plan document itself compounds the problem Russo says. Summary plan documents typically run more than 120 pages, while Russo's firm specializes in writing and auditing them; rewriting language to improve access, lower cost, and close loopholes. None of it matters, he says, if members never engage with the plan outside of a denial.
"All these amazing things that you put into your plan design - no one's looking at it. The only time a person looks at their plan is if a claim is denied," he said.
Behind the visibility problem Russo identified in the survey data is a specific claims dynamic he says is consistent across every client he has worked with in nearly three decades.
A small fraction of total claim spend - Russo puts it at under five percent, based on The Phia Group's client data - is responsible for the overwhelming majority of cost escalation in any given plan year.
"If a broker doesn't have the opportunity to look at their data and their client has over 100 employee lives - roughly 200 people on the plan - they should switch administrators," Russo said. "Because if you're using your own plan money to pay medical claims, you should have the right to see what you're paying for."
He is equally blunt about incentive structures and wants carriers to incentivize brokers to drive down costs.
A related frustration for Russo is the industry-standard practice of applying near-identical plan templates across fundamentally different employer populations. Large national carriers, he says, frequently offer the same core plan design to clients with wildly different workforce demographics, needs and risk profiles.
"Why would the same plan design be given to an employer who is a yoga studio - where everyone's in perfect shape - and also given to a truckers' union?" he said. "You're telling me the same needs are needed by both?"
Technology, in Russo's view, is being directed at the wrong end of the equation. Artificial intelligence is increasingly being used to process and adjudicate claims faster. What it is not being used for - and what Russo believes it should be - is rethinking plan design from the ground up, using workforce data to build a plan that reflects who the members actually are.
"The thought of just ripping up the plan and using AI to actually make it a better healthcare experience - it's laughable," he said. "People would laugh at me for doing that."
Russo draws a pointed comparison between the effort employers invest in managing employee performance and the near-zero attention devoted to health plan oversight.
A worker earning $100,000 might navigate self-assessments, quarterly reviews, peer evaluations and defined metrics to earn a five percent raise. That same employee, facing a planned knee surgery, typically receives no guidance about where to have the procedure, what it will cost, or whether a better option exists elsewhere in the network.
"I can go online right now and find the quality, cost, reviews, and price of a pair of white gym socks on Amazon," Russo said. "Try to find that information on a knee replacement surgery. But your preferred provider network - people see the word 'preferred' and they assume it means a better doctor. It's not a better doctor. It's not a better facility. They've agreed to a certain price or a certain discount."
At The Phia Group, Russo has spent years building what he argues the broader market should replicate. Employees who have been with the firm for five years receive free healthcare - no deductible, no copay on generics, and access to a direct primary care physician available by phone or text, with same-day appointments and no office visit charge.
"People say, 'it must be shitty healthcare,'" Russo said. "No, it's better than what you have, I guarantee."
The firm also runs a pair of financial incentive programs designed to turn passive plan members into active participants. Employees who consult HR before undergoing a planned procedure receive a $100 cash payment - enough, Russo has found, to shift behavior without significant cost. Employees who identify and flag billing errors receive 20 percent of any resulting savings.
"The first person that finds something and gets paid, they're talking about it with every other person that works here, and it becomes contagious," he said. "You have to build a culture where people are incentivized and motivated to realize there's a new procedure for knee surgeries — the recuperation time is cut in half."
His prescription for any employer spending more than $1 million annually on healthcare is a dedicated in-house resource - one person whose entire role is to monitor the plan, engage with the data, and manage vendor relationships.
"Any company that spends over $1 million on healthcare spending should have a person in-house," he said. "All they do is look at the health plan and look at the benefits as a whole and do what they can to make the health benefits better, cheaper, more accessible."
"It doesn't matter how much the increases are," Russo said. "Ninety-five percent of employers will change nothing about their process of health insurance on behalf of their employees going into next year. And that's the problem."
