Stop loosely using the word fiduciary

After more than 30 years as a consultant in the retirement space, I've learned one thing very clearly: the word "fiduciary" is not casual language. It carries real legal weight, real responsibility and real liability. It is not a marketing term. It is not a vibe. And it is certainly not something to be used loosely. 

Today, employers are overwhelmed by the expanding scope of their fiduciary obligations – particularly as those duties increasingly apply to health and welfare plans. They are trying to comply with evolving regulations, limit personal and organizational liability, and improve outcomes for employees — all while running their businesses. Employers are not looking to become "prudent experts" in every operational or oversight function. They have day jobs.

That reality is precisely why more than 80% of employers in the retirement space rely on formal fiduciary structures under ERISA Section 3 — namely 3(16), 3(21) and 3(38) fiduciaries. 

Let's pause there, because these definitions matter:

• A Section 3(16) fiduciary is responsible for plan administration and compliance. By default, this is the employer unless those duties are explicitly delegated.
• A Section 3(21) fiduciary is a co-fiduciary – someone who provides advice for a fee or exercises discretionary authority over plan management.
• A Section 3(38) fiduciary is an investment manager with full discretionary authority to select, monitor and replace investments in an ERISA-covered plan.
  

These are not buzzwords. These are deliberate governance structures designed to help employers prudently outsource defined fiduciary functions while retaining ultimate responsibility. Even when duties are delegated, the employer always remains a fiduciary.
And this is exactly where the healthcare ecosystem has a problem.

In the health plan space, the word "fiduciary" is being used so frequently and casually that it has become diluted to the point of meaninglessness. Brokers, consultants, vendors and solution providers are all too quick to talk "fiduciaries," often without understanding what the term actually implies. If they did, many would stop using it immediately.

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Employers, meanwhile, are inundated with information but starved for clarity. New regulations. New transparency rules. New data requirements. New risks. Most are understaffed, stretched thin and unequipped to translate complexity into action. This is not negligence, it's reality.

The retirement industry faced this exact moment two decades ago. ERISA litigation in the defined contribution space forced a reckoning. Employers responded by hiring outside fiduciaries, formalizing governance processes and documenting decisions. The result? Better plan design. Improved cost structures and control. Stronger outcomes for participants. Reduced liability for employers.

That same shift is now beginning in health care, but the market has not caught up.

Employers are starting to understand the scope of their fiduciary obligations for health plans. They want help. They want prudent experts. They want to outsource discrete fiduciary functions without losing control. And they want partners who will support the process, not just sell products.

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So, here's the call to action for the industry: Stop using the word "fiduciary" unless you truly are one and stop treating it like a marketing slogan. Because when it comes to an organization's health plan, there is only one fiduciary at the table: the employer.

The opportunity ahead is about building the same kind of thoughtful, documented, process-driven governance in health care that transformed retirement plans. Employers don't need more noise. They need structure. They need clarity. And they need partners who respect what fiduciary responsibility actually means.

If we get that right, everyone wins.