1. A Historic Shift: Employers Leaving ACA‑Structured Plans

Across Northern California, more small employers—especially those with healthier risk profiles—are moving away from ACA fully insured group plans in favor of level‑funded and partially self‑funded arrangements. These alternatives allow for underwriting, more control over claims, and often lower costs for healthy groups. While they can be a lifeline for some, they also remove those employers from the ACA risk pool.

2. ACA Premiums Poised to Surge in 2026

Nationwide filings show insurers proposing median premium increases of around 15 % for ACA plans in 2026—some reaching 20 % or more—marking the steepest hikes since 2018 (KFF). These hikes are driven by:

• Scheduled expiration of enhanced premium tax credits after 2025, which helped lower premiums by up to 75 % for many
• Rising clinical and drug costs along with uncertainty over tariffs and policy changes like Marketplace Integrity rules

3. Why This Matters for Small Employers and ACA Risk Pools

• Adverse selection intensifies: Healthy small groups exiting ACA plans leave a heavier concentration of sicker, more expensive enrollees, worsening the overall risk pool (Actuary.org).
• California’s market is especially vulnerable. Approximately 2.37 million Californians are enrolled through the individual ACA market. If subsidies expire, 74 % of them would face large premium increases—averaging $967/year for subsidized enrollees and $253/year even for those unsubsidized—causing around 69,000 more Californians to go uninsured (laborcenter.berkeley.edu).

When small groups flee the fully insured market, the remaining risk pool tilts even more toward higher‑cost individuals, further compounding premium increases for those who remain.

4. What California Small Employers Should Consider

• Stable enrollment matters: Level‑funded plans may save costs short‑term, but if your group remains healthy, you still play a vital role in supporting ACA pool stability.
• Risking destabilization: As more small employers opt out, premiums for the remaining ACA insured—notably low‑participation or high‑claims small groups—could become unsustainable.
• Policy flux adds uncertainty: With enhanced subsidies due to sunset at the end of 2025, insurers are pricing in worst‑case outcomes—a signal that final rate approvals may bring even higher hikes (Reddit, Reddit).

5. The Real Impact in California

In California, the loss of small‑group participation in ACA structured pools means:

• Fewer healthy adults to subsidize the broader risk pool.
• Higher premiums for small employers and employees who rely on Covered California or off‑exchange plans.
• Destabilization at the margins, where groups that feel like they are being “stabbed by rate hikes” may in fact be paying to prop up a worsening ACA pool.

6. Action Steps for Advisors and Employers

• Assess health demographics carefully before switching plans. If your group is relatively healthy, staying in a fully insured ACA plan could support long‑term stability.
• Model costs under both scenarios: compare projected claims under level‑funded vs ACA insulated group plans and consider the impact on risk pool health.
• Monitor legislative developments: any extension of enhanced subsidies or reform of Marketplace rules could alter the calculus dramatically.
• Communicate transparently with clients: many may not realize that seemingly small plan changes by peers can erode ACA market health—and indirectly hike premiums across the board.

7. Final Thought

While level‑funded and partial self‑funding offer flexibility and cost advantage for some California small employers, their growing popularity threatens the stability of ACA small‑group and individual risk pools. That puts your clients at risk—not just from their own claims experience, but from the cumulative effect of a healthier cohort exiting the fully insured market.

By proactively analyzing demographics, modeling impacts, and staying informed on subsidy legislation, brokers and advisors can guide employers through 2026’s turbulent market while working to sustain even modestly stable ACA enrollment pools.

Let me know if you’d like personalized client‑ready summaries or deeper data on Covered California rate filings as they’re finalized.

 

In today’s fast-paced world, mental health has taken center stage—and rightly so. Yet, the process of accessing quality behavioral health services remains one of the biggest pain points for both patients and payers. Enter RULA, a next-generation behavioral health provider group that’s using technology to bridge the access and quality gap in therapy and psychiatry.

What is RULA?

RULA is an in-network behavioral health platform that enables patients to connect with licensed therapists and psychiatrists—often within 24 hours. With over 16,000 licensed providers spanning all 50 states and covering 90+ specialties, RULA has become one of the largest virtual mental health care providers in the country.

But RULA is more than just a telehealth solution. It’s a clinical engine, a scheduling platform, and a partner to health plans and employers—all rolled into one.

Integrated with Major Insurance Carriers

RULA is in-network with most major health plans, including:

• Anthem/Carelon
• Aetna
• Cigna
• UnitedHealthcare/Optum
• Kaiser
• Local Blue Cross Blue Shield carriers

Because RULA operates under the fee-for-service model and processes in-network claims, patients avoid the financial burden of high out-of-network costs, while carriers benefit from cost control and better outcomes.

In 2025, RULA is expanding into EAP networks, making behavioral health more accessible for employees under existing employer-sponsored plans.

Why Health Plans Promote RULA

The 2024 MHPAEA Report to Congress exposed a grim truth: up to 92% of therapists listed in health plan directories couldn’t offer an appointment within 30 days. That’s where RULA shines.

Patients can:

• Schedule an appointment in under 3 minutes
• See a provider as early as the next day
• Get matched with a provider they’re satisfied with 98% of the time

Driving Outcomes, Not Just Access

Clinical results speak volumes:

• 73% of patients experience clinically meaningful improvement within 8 weeks.
• 93% feel better about their symptoms within 3 months.
• 80% of patients with suicidal ideation show a reduction in risk within 8 weeks.

All providers use RULA’s proprietary EHR platform, guided by clinical management and real-time support from licensed quality coaches and peer consults. This ensures both consistency and quality of care across all 50 states.

For Employers: No Extra Contracts, No Extra Headaches.

Ask your CorpStrat account manager about RULA today.

Most business owners think of tariffs as a global trade issue — something that affects importers, exporters, or the cost of raw materials. But here’s the hidden truth: tariffs may quietly drive up the cost of employer-sponsored health benefits, affecting your bottom line and your ability to attract and retain talent.

How Do Tariffs Connect to Health Insurance?

Healthcare is a complex supply chain — and many medical devices, pharmaceuticals, and even basic supplies like syringes, gloves, and diagnostic equipment are imported. When tariffs are imposed on foreign goods (especially from major suppliers like China, India, or the EU), the cost of these essentials increases. That cost wont likely stay with the manufacturers — it will most likely get passed down to hospitals, doctors, and ultimately, to payors: Medicare, Medicaid, self-funded employers and your insurance carrier. And then the patient. The possible result? Rising premiums, higher deductibles, and tighter networks.

3 Key Ways Tariffs may Impact Employer Plans

1. Increased Medical Supply Costs = Higher Claims Costs
When hospitals & Providers pay more for medical equipment and supplies, they charge more for procedures. Insurance companies and Medicare may be forced to raise premiums to cover these higher payouts.

2. Drug Prices Could Spike
Tariffs on active pharmaceutical ingredients (APIs) or finished drugs can increase the cost of common medications — affecting formularies and out-of-pocket costs for employees.

3. Pressure on Carriers = Narrower Plans
To manage rising costs, insurers may restrict provider networks or increase cost-sharing. Employers end up having to offer leaner benefits or absorbing the cost increases.

What Can Employers Do?

Plan Ahead: Budget for above-average premium increases in upcoming renewals — especially if your carrier has exposure to international supply chains.

Consider partial or Self-Funding: If your group is eligible, self-funded or shared cost plans may offer more transparency and control over rising costs.

Educate Employees: Communicate why benefits might be shifting and how employees can be smart consumers of healthcare.

Bottom Line

Tariffs aren’t just about trade wars — they could be a stealth tax on your healthcare costs. Employers who stay ahead of the curve, explore strategic funding options, and rethink plan design can weather the storm better than those who don’t.

Looking to stay proactive in your benefits strategy? Let’s talk about how to structure a health plan that works — no matter what happens with global trade.

If you’ve ever felt overwhelmed trying to understand your benefits – specifically your health insurance, you’re not alone. Between the acronyms, the fine print, and the seemingly endless rules, navigating health coverage can feel like a full-time job. But beneath the complexity lies an important truth: many of these layers exist to protect you — the employer and the consumer — and to keep the system fair and accountable.

A Web of Regulations Designed to Protect

Employer-sponsored health plans aren’t governed by just a handful of rules — they’re subject to dozens of federal laws. According to BenefitsPro, at least 46 federal laws apply to some employer health plans, and 42 apply even to self-funded ones. That’s in addition to state-level regulations and guidance from multiple government agencies.

Each law adds a piece to the puzzle — whether it’s about what must be covered, how claims are processed, how your data is protected, or how insurers must behave. It’s no wonder employers and employees alike often find the system hard to decipher.

Add that to the rating complexity created by the ACA – where most states have age rated and location rated plans – based on each particular plan and participant age, and you have a heck of an administration challenge to boot!

Complexity with a Purpose: Consumer Protections

Even though it can be confusing, much of this regulation exists for your benefit. Here are just a few of the ways the law works in your favor:

• Coverage You Can Count On
  The Affordable Care Act (ACA) requires insurance companies to cover people regardless of preexisting conditions. This means you can’t be denied care because of your health history — a major shift from the past.
• Essential Health Benefits
  The ACA also defines 10 essential health benefits — including maternity care, mental health services, and prescriptions — that must be included in most plans. These protections ensure coverage is not just available, but meaningful.
• Accountability for Insurers
  Rules like the “medical loss ratio” ensure that insurers spend most of your premium dollars on actual care — not just overhead or profits. If they don’t, you may get money back in the form of a rebate.

State Rules Add Another Layer

On top of federal laws, each state has its own insurance department that oversees insurers operating locally. States can add additional requirements or consumer protections, which further contribute to the complexity — but also enhance fairness, transparency, and access to care. California has more of these additional requirements than any other state,

Why It Matters

All of this regulation might make health insurance feel difficult to understand, but the intent is clear: to ensure that plans are reliable, insurers are accountable, and consumers are treated fairly. These rules:

• Safeguard your right to coverage
• Help keep costs transparent
• Provide standards for what must be included in your plan
• Hold insurance companies to high standards

Final Thoughts from CorpStrat

Employer Sponsored Health insurance isn’t complex by accident — it’s complex by design. At CorpStrat, we help employers and employees cut through the noise and make sense of their benefits, because understanding the “why” behind the system empowers better decisions.

Need help navigating your benefits strategy or simplifying your company’s insurance plan?

Connect with us today at www.corpstrat.com, or call (818) 377-7260.

We simplify the complex — so you can focus on your people, your business, and your future.

The growing popularity of GLP-1 receptor agonists—such as Ozempic and Mounjaro for diabetes, and Wegovy and Zepbound for weight management—has sparked both excitement and concern. These drugs, initially designed to treat Type 2 diabetes, have demonstrated remarkable effectiveness in weight loss, leading to a surge in demand. However, the skyrocketing costs of these medications are creating ripple effects across the healthcare system, raising questions about affordability, insurance coverage, and the long-term financial burden on both employer-sponsored and individual health insurance plans, including Medicare.

Could GLP-1s Double Healthcare Costs?

GLP-1 drugs are among the most expensive outpatient prescription medications on the market today, with a monthly cost ranging from $900 to $1,300 per patient. As their popularity grows, insurers, employers, and government programs like Medicare face mounting expenses that could significantly drive up the overall cost of healthcare.

Several estimates suggest that if a sizable percentage of the U.S. population were to use these drugs long-term for weight management, the total spending on GLP-1s alone could rival that of cancer treatments. A report from the Institute for Clinical and Economic Review (ICER) estimates that widespread adoption of these medications could add hundreds of billions of dollars annually to U.S. healthcare spending.

Impact on Employer-Sponsored Health Insurance

Employers, already struggling with rising healthcare premiums, are grappling with how to handle the increasing costs of GLP-1 drugs. Many insurers currently cover Ozempic and Mounjaro for diabetes treatment but deny coverage for Wegovy and Zepbound, which are FDA-approved for obesity. This creates frustration among employees who are unable to access these life-changing drugs unless they have a diabetes diagnosis.

As more employees push for coverage of weight-loss medications, employers must decide whether to absorb the additional cost or pass it on to workers through higher premiums, copays, or deductibles. Some large corporations are beginning to cover weight-loss GLP-1s, but this could lead to higher insurance costs for all employees, including those who do not take the medications.

Impact on Individual and Medicare Insurance

For individuals purchasing their own insurance, GLP-1 drug coverage varies widely by carrier. Medicare, which currently does not cover weight-loss medications, may face increasing pressure to change its stance as obesity treatment becomes a greater public health priority. If Medicare were to begin covering these drugs, it could add billions in new spending, likely leading to higher Medicare Part D premiums or more restrictive eligibility criteria.

At the same time, Medicaid programs in some states have begun covering GLP-1s for weight loss, recognizing obesity as a serious health condition that leads to higher long-term healthcare costs. However, this raises concerns about budget sustainability and whether the federal government will need to step in to negotiate lower prices.

Will Drug Manufacturers Face Pressure to Lower Costs?

As demand for GLP-1 drugs soars, manufacturers like Novo Nordisk (Ozempic, Wegovy) and Eli Lilly (Mounjaro, Zepbound) face growing calls to lower prices. Some key forces driving this pressure include:

• Government Negotiation: The Biden administration’s Inflation Reduction Act allows Medicare to negotiate drug prices, and GLP-1s could soon be on the list of targeted drugs for cost reductions.
• Employer Pushback: Large corporations and employer groups are lobbying insurers to demand rebates or lower pricing from drug manufacturers.
• Patent Expirations & Generic Competition: Once patents expire, generic versions of these drugs will likely emerge at a fraction of the current cost, but this is still several years away.

The Coverage Gap: Diabetes vs. Weight Loss

One of the most frustrating challenges for patients is the inconsistent insurance coverage for GLP-1 drugs.

• Diabetes GLP-1s (Ozempic, Mounjaro) are covered by most insurance plans, as they are approved for treating Type 2 diabetes.
• Weight-loss GLP-1s (Wegovy, Zepbound) are often denied because most insurers do not cover weight-loss treatments, despite obesity being a recognized medical condition.

This policy leaves many patients forced to pay out-of-pocket for weight-loss medications or seek loopholes, such as obtaining an off-label prescription for a diabetes drug like Ozempic or Mounjaro.

As obesity treatment becomes a greater focus of national healthcare discussions, insurers may eventually expand coverage, but at what cost? If insurers begin widely covering these drugs, the financial burden could be shifted to higher premiums for everyone.

Looking Ahead: The Future of GLP-1 Drugs in Healthcare

With the growing popularity of GLP-1 drugs, the healthcare system is at a crossroads. Policymakers, insurers, and employers must weigh the benefits of expanding access to these effective medications against the potentially unsustainable costs they introduce.

In the coming years, we may see:

• More government intervention to control drug pricing and negotiate discounts.
• Increased employer demand for alternative pricing structures.
• Potential changes to Medicare and private insurance coverage policies regarding weight-loss medications.

For now, individuals and employers should stay informed on coverage policies, negotiate with insurers, and explore all options for cost-effective access to these groundbreaking treatments.

Reach out to us at CorpStrat to ask how we help employees and companies navigate healthcare.