Self-Funded With Spencer How Health Insurance Was Broken Over The Last 40 Years | with John Rutledge
Oct 14, 2025
John Rutledge, a veteran in employee benefits from Marsh McLennan Agency, dives into the chaotic evolution of health insurance over the past four decades. He reveals how the industry shrank from 25 carriers to just four, significantly limiting competition. Rutledge discusses the impact of the ACA on self-funding and the increasing relevance of alternative risk models like captives. He also emphasizes the crucial need for engaged employers to stabilize costs, push for price transparency, and actively manage their healthcare as a key component of their business strategy.
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Industry Consolidation Shrunk Choices
- The employer health market consolidated from ~25 carriers to four national players over decades.
- That consolidation drastically reduced real product choice and competition.
Carrier-Owned PPOs Became A Moat
- Carrier-owned PPO networks replaced independent networks and became a competitive moat.
- Employers without carrier-owned networks were forced to sell or exit the market.
Four Decades Watching Self-Funding Rise
- John began in the industry in 1982 and saw self-funding grow from ~42% to nearly 70% of employers.
- The ACA accelerated self-funding and spawned many alternative risk models like captives.