When I moved from Dallas to LA in 2013, I thought I understood traffic. Ha! Dallas has rush hour. LA is rush hour — every freeway, every direction, all the time.

It took me 2 years to realize the roads weren't ever going to clear. Early on, I mentioned to a consultant that I'd taken the 405 to get to his office. He groaned, “The 405?! I hate that road!” Eventually I realized that there was no good time to drive it, and — almost literally — no other way to get there.

The benefits business has become that freeway
Six lanes — consultants and brokers, voluntary benefit enrollment firms, well-being and health-management vendors, point solutions, ben-admin platforms, and the employers who buy from all of them — and right now every lane is moving against a headwind. No one has an open road.

Many factors are changing the traffic pattern, and Morgan Stanley is now naming AI as a critical macro variable, not just a tech story.

Benefits are caught up in an industrial buildout of nearly $3 Trillion that’s reshaping GDP, earnings, and corporate capital allocation at a scale that touches every budget line.

The abstraction is getting very real: Teradata told its 5,100 employees it would fund its AI investment by reallocating the money it had previously set aside for 2026 salary adjustments. Oyez Oyez! The reallocation isn’t just coming from where you might expect; even AI’s own enthusiasts are tightening.

Uber, after urging staff to use AI freely, turned around just four months later and capped internal spending — when the bill came in! The companies writing the AI checks are starting to ask, “What am I actually getting for this?” And that question won't stay buried in the IT budget.

CHRO's are...on it. Deloitte and Zoom both pulled back on family leave this spring, with Deloitte halving parental leave and trimming fertility and IVF support for a segment of its workforce. They framed the cutbacks — surprise, surprise! — as “better aligning with the marketplace.” Mercer’s Rich Fuerstenberg zeroed right in: “There’s more scrutiny, and it’s ‘Why are we over market? What am I getting from these programs?’”

That's the question now idling in every lane. And it’s the right question — which is exactly why it’s dangerous to answer it badly.

Cuts? or investments?
Consider the lane drawing more and more attention: GLP-1 coverage. The Wall Street Journal reported last week that more than a quarter of large employers are adding hurdles to coverage this year or next, while 11% have dropped or plan to drop it for weight loss outright.

Chevron now requires weigh-ins, meal-tracking, and health coaching. BCBS of Massachusetts projected its GLP-1 costs would approach $1 billion this year — roughly seven times what it spent in 2023 — and moved the coverage to a paid add-on rather than absorb it. The drugs that were a recruiting tool two years ago (one survey found 30% of workers would switch jobs to get them) are now a line item CFOs are increasingly questioning.

But notice the countervailing traffic in that same lane. Some employers are finding the opposite. An Aon study of 192,000 users found medical-cost growth slowing and hospitalizations dropping after 18 months on the drugs.

In the WSJ article, Soren Bjorn, the CEO of berry supplier Driscoll's, recounted a debate among executives at the Milken Conference: those whose companies had committed to broad GLP-1 coverage said that after 18 to 24 months, their overall healthcare costs had started to fall — enough that Bjorn said Driscoll's plans to make the coverage free to employees next year.

So the lane isn’t simply “cut the expensive drug.” It’s a live argument about which spend is a cost and which cost is an investment — and most employers are genuinely struggling to tell the difference.

North? South? East? West?
Uncertainty is the real story, and it runs in every lane. And what nerve does uncertainty tend to strike? Yep: the primal fight, flee or freeze survival instinct.

• The well-being vendor is told to prove ROI with engagement data it struggles to validate.

• The point solution gets singled out because it can't get more than 25% of its "identifieds" engaged.

• The enrollment firm watches employer health plan dollars shrink — putting increasing pressure on voluntary products to fill the gap - while employees struggle to keep up.

• The ben-admin platform is asked to "API into everything — but don't raise our rates!"

• Consultants are facing clients demanding they cut costs — "but don't let us look cheap!"

Every lane faces a force coming straight at it, and the freeway isn't getting any wider. Nobody is adding lanes to the benefits budget — the AI buildout and double-digit health trend are seeing to that. Which leaves exactly one move.

If you can’t add more lanes, then each existing lane has to carry more load.

Benefits engagement is the macro variable that's still fungible
"Engagement" can't persist as a soft metric, especially when nobody really knows what it means. But define it clearly, and measure it, and it earns its keep as the only lever left that can raise the yield on a benefits dollar without adding to the spend.

It can become the difference between a program you can defend when the CFO asks “what am I getting?,” and one you have to apologize for. You can't answer that question without knowing who engaged, who didn’t, and why.

It doesn't matter how cool the car looks — if your people can't picture themselves behind the wheel, it's not going anywhere.

The last word
Traffic isn't getting lighter. Not this year, probably not this decade. But the firms that get through rush hour aren’t the ones waiting for open road. They’re the ones who figured out how to make every lane move — with RESULTS — which means knowing, finally, who’s actually in the car.

~ Mark Head

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