Welcome to RIMScast. Your host is Justin Smulison, Business Content Manager at RIMS, the Risk and Insurance Management Society.

In this episode, Justin interviews David Neikrug, CEO at Optimatum Solutions, about managing vendors of employer-sponsored healthcare and a recent Optimatum Solutions report, “A Path Not Taken: Vendor Management in Employer-Sponsored Healthcare”. David explores with Justin the topic of applying risk management tools to HR programs and plans, an area that risk managers rarely visit. They touch on ways for risk managers to contribute at the table using the risk management skills and tools that they have applied to recognized risk areas for years.

Listen to learn about the benefits of managing benefit plan vendors.

Key Takeaways:

[:01] About RIMS and RIMScast.

[:17] About this episode of RIMScast. Our topic is vendor management. We will dive deeply with Optimatum Solutions CEO, David Neikrug.

[:40] RIMS-CRMP Workshops! The next Virtual RIMS-CRMP exam prep, co-hosted by Parima, will be held on September 2nd and 3rd.

[:50] The next RIMS-CRMP-FED virtual workshop will be held on November 11th and 12th, and led by Joseph Mayo. Links to these courses can be found on the Certification Page of RIMS.org and through this episode’s show notes.

[1:07] RIMS Virtual Workshops! RIMS has launched a new course, “Intro to ERM for Senior Leaders.” It will be held again on November 4th and 5th and will be led by Elise Farnham. RIMS members enjoy deep discounts!

[1:24] The full schedule of virtual workshops can be found on the RIMS.org/education and RIMS.org/education/online-learning pages. A link is also in this episode’s notes.

[1:35] The next RIMS Webinar will be held on September 4th and will be led by AXA XL. It is titled “Lockdown & Level Up: Turn Up Your Cyber Security Game Against Creative Cyber Criminals”.

[1:48] On September 18th, Origami Risk will present “Driving Better Incident and Claims Management with Data, Technology & Strategic Collaboration”.

[1:56] On October 30th, Swiss Re will present “Parametric Insurance: Providing Financial Certainty in Uncertain Times”.

[2:05] On November 6th, Hub will present “Geopolitical Whiplash — Building Resilient Global Risk Programs in an Unstable World”. Register at RIMS.org/Webinars.

[2:17] Mark your calendars for November 17th and 18th for the RIMS ERM Conference 2025 in Seattle, Washington. The agenda is jam-packed with educational sessions that will resonate with risk practitioners in all stages of their careers.

[2:38] See the full agenda at RIMS.org/ERM2025.

[2:44] RISKWORLD 2026 will be in Philadelphia, Pennsylvania, from May 3rd through May 6th. RIMS members can now lock in the 2025 rate for a full conference pass to RISKWORLD 2026 when registering by September 30th.

[2:58] This also lets you enjoy earlier access to the RISKWORLD hotel block. Register by September 30th, and you will also be entered to win a $500 raffle. Don’t miss out on this chance to plan and score some extra perks.

[3:11] The members-only registration link is in this episode’s show notes. If you are not yet a member, this is the time to join us. Visit RIMS.org/membership and build your risk network with us here at RIMS.

[3:26] On with the show! You wanted to hear about vendor management, and that’s why I reached out to Optimatum Solutions CEO, David Neikrug, to discuss the findings in Optimatum’s new report, “A Path Not Taken: Vendor Management in Employer-Sponsored Healthcare”.

[3:50] It’s got some fascinating insights, and I wanted to extend the dialogue beyond the PDF, so let’s get started!

[3:56] Interview! David Neikrug, welcome to RIMScast!

[4:07] Justin hasn’t covered vendor management much on RIMScast. Justin invited David on the show to talk about Optimatum’s publicly available paper, “A Path Not Taken: Vendor Management in Employer-Sponsored Healthcare.” This speaks to a risk management audience.

[4:28] There is a link in this episode’s show notes. The average cost of healthcare in 2025 is pushing north of $25K total cost, per employee per year, and it’s an outsourced function. It’s a large amount of money.

[5:08] HR generally doesn’t have the traditional service level agreements (SLAs) or performance guarantees that are present in an IT services agreement. That’s a major disconnect that leads to financial, operational, and risk issues that go unchecked.

[5:44] Traditionally, we don’t see risk managers getting involved in HR things like employer-sponsored healthcare. David encourages risk managers to take the tools and skills they know and apply them to HR and employer-sponsored healthcare and retirement plans.

[6:23] David suggests risk managers should demand vendor transparency when it comes to fees, debits, and credits. David talks about pharmacy rebates, segregation, and how credits are captured and applied.

[7:09] David says vendor harmonization can be applied vertically or horizontally. The vertical side is when a company has acquired several HR benefits and programs, and then merges them into one program. The value creation by doing that is immense.

[7:56] David says horizontal harmonization applies to anybody who aggregates companies of various kinds, including family offices. Each company may have a disparate benefits plan. Bringing plans together can save hundreds to thousands of dollars per employee per year.

[8:46] Those are the types of numbers Optimatum Solutions is seeing as the opportunity for a risk manager to focus on as a quantifiable value proposition of bringing 10 vendor programs into one aggregated program.

[9:14] From a risk standpoint, you have a single source to manage across enterprises.

[9:31] David often speaks using numbers to convey the point. He says risk managers have a wealth of information and know what they are doing. When it comes to opportunities to create value, HR is an area they’re not thinking about.

[10:25] David suggests surveying risk managers and asking what percentage of risk managers are focused on the HR side, employer-sponsored healthcare, and retirement plans. You’ll see the opportunity is almost endless.

[10:44] Quick Break for RIMS Events! On September 18th, the 10th Annual Chicagoland Risk Forum will be held at The Old Post Office in Chicago. Register at ChicagoRIMS.org.

[10:59] On October 1st through the 3rd, the RIMS Western Regional Conference will be held in North San Jose at the Santa Clara Marriott. The agenda is live. It looks fantastic! Visit RIMSWesternRegional.com and register today!

[11:15] On November 17th and 18th, elevate your ERM Program and career at the RIMS ERM Conference 2025 in Seattle, Washington. The agenda is live, and early rates are available until September 5th. Register now to save $110 and secure your spot at the ERM event of the year.

[11:37] Canadian listeners, take note, that’s just a little bit South of the border in British Columbia. That’s a great way to extend your knowledge after the RIMS Canada Conference. Visit RIMS.org/ERM2025 to register.

[11:52] At the top, Justin mentioned RISKWORLD 2026. Through September 4th, the RISKWORLD education content submission process is still open.

[12:02] RIMS invites you to share your experiences, best practices, and innovative strategies that represent the global outlook of risk management. Send us your submission, and who knows? We might select you to speak at RISKWORLD 2026 in Philadelphia! The link is in the show notes.

[12:20] Let’s Return to My Interview with David Neikrug!

[12:42] David says the first thing to do is make sure risk managers have a seat at the table of employer-sponsored healthcare. They need to look at and understand all the terms and conditions of the contracts, looking for the low-hanging fruit.

[12:55] Look for Service Level Agreements, Performance Guarantees, and Built-in Reconciliation Clauses for the vendor to provide a self-reconciliation of all the debits and credits from the plan year. Understand the contracts.

[13:17] Second, make sure that you’re a part of the team. Look at what you can do, bringing all the tools that you’ve acquired, dealing with the risk side over the years, and applying them to the HR benefits side.

[13:54] For organizations of between 500 to 5,000 employees, there is ample opportunity. Those are going more unwatched than the larger organizations. The vendors aren’t used to being held as accountable as they are for a Fortune 100.

[14:21] David would say there isn’t an organization that doesn’t have an opportunity. It’s a matter of focusing on it and bringing your expertise to the table to help your organization hold those vendors accountable, drive savings and performance, and create value.

[14:59] David said Optimatum Solutions had a client that was a rapidly growing organization. They had acquired a company and decided to change the acquired company’s vendor because they had been using a different vendor.

[15:22] David mentions that Optimatum Solutions has a focus on improving or fixing relationships with vendors, versus running an RFP and finding a new vendor. It’s better to fix a problem than to replace it.

[15:40] Someone at the client company decided to move the pension plan business of the acquired company to a new provider. The plan was started in 1972, before the ERISA regulations on how pension plans are managed. The new vendor did no due diligence and took it over.

[16:37] Within the first year, there was a claim by a retiree that the lump sum payment should have been 10 times what it was, stemming from one example in a plan document of how a benefit will be calculated. The company had to defend an $18 million potential claim.

[17:11] It took three years to resolve. This taught the new vendor what the old vendor had been doing seamlessly for all those years. The former vendor knew how to deal with various situations, including payments to international employees.

[17:49] The new vendor hadn’t understood what they were acquiring. That led to a colossal mess.

[18:10] It was an HR issue. They had a risk manager, but hadn’t thought of having the risk manager at the table for this event.

[18:20] A Final Break! The Spencer Educational Foundation’s goal to help build a talent pipeline of risk management and insurance professionals is achieved, in part, by its collaboration with risk management and insurance educators across the U.S. and Canada.

[18:40] Since 1999, Spencer has awarded over $2.9 million to create more than 570 Risk Management Internships. The Internship Grants application process is now open through October 15th, 2025.

[18:56] To be eligible, risk managers must be based in the U.S., Canada, or Bermuda. A link to the Internship Grants page is in this episode’s show notes. You can always visit SpencerEd.org, as well.

[19:10] The Spencer 2025 Funding their Future Gala will be held on Thursday, September 18th, at the Cipriani 42nd Street in Manhattan, New York. This year’s honoree is Tim Ryan, the U.S. President of Lockton, and we look forward to having Tim join us here on RIMScast very soon.

[19:29] A link to the Gala is also in this episode’s show notes. Buy a ticket, enjoy a great night in the city, and support the future of risk management.

[19:38] Let’s Return to the Conclusion of My Interview with Optimatum Solutions CEO, David Neikrug!

[19:47] Behavioral and mental health are workforce concerns and reputational risks. David says the real number is productivity. If a factory has employees out for behavioral health issues, it has to replace those employees with temporary workers while still paying them.

[20:43] The total cost of unmanaged behavioral health in a workforce is not just the behavioral health medical claims, pharmacy claims, or inpatient claims; it’s also the lost working hours of those employees and the replacement costs of those employees.

[21:15] That’s a much larger number than just the surface of behavioral and mental health. Today, all health plans have strong behavioral programs. Organizations have Employee Assistance Programs (EAPs).

[21:38] There are also point solutions adding a layer of a microbenefit on top of the program to ensure that employees are receiving the right care at the right time, in the right place.

[22:01] Organizations have the right tools. An employer will have all these programs, but they’re disconnected. No one is bringing everyone to the table.

[22:24] For a certain cost per employee per month, an EAP vendor will provide a given number of behavioral health visits. They will support the process within the traditional healthcare delivery system. Organizations can have point solutions for behavioral health.

[23:00] Organizations can have these vendors at the table to understand what’s going on at the organization. Are there RIFs? Are there acquisitions? Does the organization have seasonal issues driving stress? Is there an issue with the community where the organization is located?

[23:20] Look at it holistically. Bring all these vendors to the table and discuss what’s going on.

[23:30] In an unfortunate situation where employees are very stressed and have some sort of episode while at work, that’s a material reputational risk, internally, and it may become an external issue. Most employers today have the vendors in place who can support them.

[24:05] The steps are bringing the vendors to the table and managing them to ensure that they’re aligned with the intended outcomes, and everyone’s goal is aligned accordingly.

[24:20] When you’re discussing the organization with vendors, what about trade secrets, such as expansion and strategy? David says if you have the right vendor, they’re about confidentiality.

[24:46] If you’re about to announce a Reduction in Force (RIF) or an acquisition, you will want your EAP in place to train managers to deal with employees who may be stressed.

[26:01] David talks about AI risks. Ensure that when your employees are using any AI platform, you have thoroughly vetted the platforms you are allowing them to use to make sure that none of your proprietary or confidential information lands in public.

[26:36] When using AI with confidential information, unless it’s a closed system, you have a material risk of it being exposed.

[27:02] AI is here for the future. It will change the face of every single profession. Justin assures that there will be no bots hosting or guesting on RIMScast!

[27:35] David asks organizations, in the face of AI, What are you doing about it? How are you training and supporting your employees so that they can be part of the future, versus being a former employee who has been replaced due to AI?

[27:54] In analytics, AI is simplifying delivery and crunching numbers like we’ve never seen before. These are incredible benefits for organizations in the future.

[28:27] David thinks that you need internal tools to ensure that your employees are not divulging confidential information within public tools and that your vendors and their vendors are all aligned to apply the same rules for confidentiality.

[29:12] David, you have been such a wonderful guest! I’m so glad that you were here to provide a little extra insight into the recent Optimatum Solutions paper, “A Path Not Taken: Vendor Management in Employer-Sponsored Healthcare”. A link is in this episode’s show notes.

[29:35] At the end of the paper is David’s contact information.

[29:53] Special thanks again to Optimatum Solutions CEO, David Neikrug, for joining us here on RIMScast. You can find the link to A Path Not Taken, the professional report, at OptimatumSolutions.com and in this episode’s show notes.

[30:11] I’ve also got links to RIMS coverage of vendor management in this episode’s show notes.

[30:17] Plug Time! You can sponsor a RIMScast episode for this, our weekly show, or a dedicated episode. Links to sponsored episodes are in the show notes.

[30:45] RIMScast has a global audience of risk and insurance professionals, legal professionals, students, business leaders, C-Suite executives, and more. Let’s collaborate and help you reach them! Contact pd@rims.org for more information.

[31:03] Become a RIMS member and get access to the tools, thought leadership, and network you need to succeed. Visit RIMS.org/membership or email membershipdept@RIMS.org for more information.

[31:21] Risk Knowledge is the RIMS searchable content library that provides relevant information for today’s risk professionals. Materials include RIMS executive reports, survey findings, contributed articles, industry research, benchmarking data, and more.

[31:37] For the best reporting on the profession of risk management, read Risk Management Magazine at RMMagazine.com. It is written and published by the best minds in risk management.

[31:52] Justin Smulison is the Business Content Manager at RIMS. Please remember to subscribe to RIMScast on your favorite podcasting app. You can email us at Content@RIMS.org.