In conversation with Mehul Agarwal, Founder of Health Compiler, Terry Shook draws on 45 years in the employee benefits industry to lay out a sharp critique of how health plans are sold, managed, and misunderstood. His perspective, shaped by two decades inside a Blue Cross system and the years since spent advising self-funded employers, is that the healthcare system's problems are not accidental.
A Career Built on Both Sides of the Table
Terry Shook has spent 45 years in the benefits industry, with roughly 20 of those inside a Blue Cross system. That experience gave him an insider's view of how carriers operate, where their incentives lie, and what employers are rarely told. Today, he works primarily with fully insured and self-funded employers, bringing an advisor's perspective that is informed by years on the carrier side.
His central belief is unambiguous. "The healthcare system is not broken," he says. "It is working exactly the way that those in control of it want it to work." He sees the problems employers face not as system failures but as features designed to benefit the parties running the system.
Brokers Versus Advisors
One of Shook's most emphatic distinctions is between brokers and advisors. In his view, a broker's fiduciary duty runs to the carrier, not the employer. An advisor, by contrast, is fiduciary to the client. This is not a semantic difference. Shook believes it fundamentally shapes the advice employers receive and the outcomes they experience.
He backs up his position with a personal commitment. Shook holds validation through the Validation Institute, which includes up to a $1,000,000 ERISA Immunity Guarantee. His clients are protected if his advice leads to a fiduciary breach. "I put my money where my mouth is," he says. It is a level of accountability he believes is rare in the industry and one that employers should demand of anyone managing their health plan spend.
Looking Under the Hood of Employer Contracts
A significant part of Shook's work involves reviewing the actual contracts employers have with carriers and administrators. What he frequently finds are provisions that put employers at a disadvantage, terms they agreed to without fully understanding their implications. He sees this as one of the most overlooked areas in benefits management. Employers are signing documents that quietly shape their costs and their options, and most do not realize it until someone takes the time to read the fine print.
AI Underwriting and Cost Forecasting
Shook has embraced technology as part of his practice, using AI underwriting and cost forecasting tools to project outcomes for his clients. He sees these tools as essential for bringing precision to an industry where too many decisions are still based on guesswork or carrier-supplied projections that serve the carrier's interests.
The Carrier Shift Toward Medicare
One trend Shook identifies is the major carriers' increasing focus on Medicare over commercial employer plans. As profit margins on Medicare lines grow, carriers are dedicating more resources and attention there, sometimes at the expense of the commercial employer market. For self-funded employers, this means the carrier's priorities may no longer align with theirs, a dynamic Shook believes is important for employers to understand.
PBM Rebates and Pharmacy Costs
On the pharmacy side, Shook is blunt about how Pharmacy Benefit Manager rebate structures work. He advocates for a redefinition of how rebates are structured and where they ultimately flow, arguing that the current system often benefits the PBM and the carrier far more than the employer or the plan members.
The Fiduciary Gap Between Health Plans and 401(k)s
Shook draws a pointed comparison between how fiduciary duty operates in 401(k) plans versus health plans. In the retirement space, ERISA requirements have created clear accountability. In the health plan space, that same level of accountability is largely absent. Shook believes it is only a matter of time before the legal and regulatory landscape catches up, and he advises employers to get ahead of that curve rather than wait for it to arrive.
Views on AI in Healthcare
Beyond his use of AI in underwriting, Shook sees broader potential for artificial intelligence in healthcare, particularly in how data is analyzed and how decisions are made at the plan level. He views technology as a tool that can level the playing field for employers who have historically been at an information disadvantage relative to the carriers and administrators they work with.
Advice: Ask the Right Questions
For employers navigating this landscape, Shook's guidance comes back to accountability. He encourages employers to understand the fiduciary obligations of everyone touching their health plan, to demand transparency in contracts and pricing, and to ask harder questions to the people managing their benefits. The system, as he sees it, will not reform itself. Employers who want different outcomes have to approach the process differently, starting with who they trust to advise them and how they hold those advisors accountable.