Article - September 15, 2026
Featured Professionals: Martin Keck, Dan Linsalata
Employers are prioritizing competitive benefits programs that meet rising employee expectations while navigating a complex regulatory and technology landscape. Handling these benefits in-house is costly and time-consuming, and most businesses aren't equipped to do it well.
As a result, tech-enabled benefits administration platforms have become critical partners, helping organizations manage a larger set of benefits, improve hiring and retention, remain compliant, mitigate costs, and streamline workflows.
Below, we share what’s driving investor interest in benefits administration technology and services and what made our recent client ThrivePass a standout opportunity.
A Larger Role
Benefits administration platforms specializing in a wide range of employee offerings, from voluntary options to healthcare, are important to companies of all types and sizes. Employers view these benefits as a vital tool for attracting and retaining talent, with MetLife's 2026 U.S. Employee Benefit Trends Study finding that 60% of employers increased their benefits investment and 62% expanded their non-medical offerings.1
These more comprehensive packages are heightening the value of outsourced providers that can enhance employee satisfaction while managing regulatory complexity across a broader mix of benefits. For example, programs like COBRA and pre-tax benefits require specialized processes for enrollment, claims, reimbursements, reporting, and participant communications, all against a backdrop of federal and state-specific requirements with substantial legal consequences.
“Employer benefit offerings span highly regulated options like COBRA or pre-tax to voluntary or consumer-directed benefits including lifestyle spending accounts, commuter benefits, and tuition reimbursement,” says Martin Keck, a managing director in our Technology Group. “Managing these programs correctly and at scale requires technology, compliance expertise, operational support, and employee services.”
Healthcare benefits are similarly complicated, adds Dan Linsalata, a managing director in our Healthcare & Life Sciences Group, with healthcare costs being employers’ biggest non-payroll expenses and continuing to rise. In fact, Mercer projects a 6.5% increase in total health benefit cost per employee for 2026, which it describes as the highest in 15 years.2
In response, innovative third-party administrators (TPAs) are helping employers implement cost mitigation strategies and drive employee engagement. “Successful employer health TPAs have expanded beyond claims processing to become strategic partners for their clients, enabling more flexible benefit packages and lowering costs while coordinating a growing number of solutions,” says Linsalata.
Meanwhile, industry-specific workforce dynamics are further bolstering the need for benefits administration platforms with specialized experience. Restaurant and retail employers with large quantities of hourly employees, for instance, often experience higher turnover and more frequent benefits changes, making efficient administration more difficult and dedicated expertise especially important.
Innovation and AI Insulation
Across the space, leveraging advanced technology is key for leading benefits administration platforms. With many providers still using legacy systems, there’s a significant opportunity for forward-thinking companies to deliver a better user experience, greater flexibility, and higher efficiency.
AI is a particularly powerful technology accelerant, enabling platforms to automate certain functions and improve productivity, scalability, and margins. “Routine tasks, such as document review, receipt validation, basic claims processing, decision support for benefits and plans, and first-level customer service triage, can all be enhanced through AI,” says Linsalata.
However, benefits administration remains highly dependent on human expertise, with regulatory interpretation, compliance decisions, and complex benefit guidance requiring the judgement of experienced professionals.
“While AI is disrupting some areas of software, benefits administration is less vulnerable to that shift,” says Linsalata. “With a PEPM based business model, key human elements to the offering, and the ability to leverage AI to drive operational efficiencies, all paired with a high cost of failure, these businesses are well positioned in the current environment.”
“This AI resilience is especially valuable in today’s fast-changing market, which is why investors are so interested in companies that pair strong technology with deep domain knowledge,” adds Keck.
ThrivePass: Key Success Factors
ThrivePass is a benefits technology company that works with brokers, professional employer organizations, and employers to deliver flexible, personalized benefits that improve engagement and retention. Harris Williams advised ThrivePass on its sale to Shore Capital.
Several factors made ThrivePass stand out:
A proprietary technology platform: In a market where many competitors still rely on legacy or third-party systems, this foundation supports product innovation, operational efficiency, better margins, and a stronger user experience.
Meaningful capabilities in regulated benefit categories: COBRA, pre-tax account administration, and other heavily scrutinized areas require specialized workflows, compliance expertise, and payment infrastructure that can be difficult to replicate.
Multiple benefit solutions through a single platform: As employers look to simplify administration and reduce vendor complexity, integrated platforms are becoming increasingly attractive.
“Shore Capital’s investment will help ThrivePass keep improving its product, technology, and client experience as more employers and members come on board,” says Keck. “The partnership gives ThrivePass the resources and healthcare expertise it needs to move faster on its goal of making employee benefits work better for employers, brokers, and the people who rely on them every day.”
Simplifying Administration, Improving the Experience
Benefits administration platforms, from those specializing in voluntary offerings to those focused on employer health, continue to benefit from growing benefits complexity, significant regulatory oversight, technology modernization and cost pressures, and employer demand for specialized expertise.
“As organizations expand and personalize their benefits packages, the need for benefits technology and services will remain strong,” says Keck. “Platforms like ThrivePass that simplify administration, increase benefit use, and bring together fragmented programs are poised for long-term success.”
To further discuss investment opportunities across benefits administration technology and services, please contact our senior professionals.
https://extensishr.com/resource/blogs/metlife-2026-employee-benefits-trends-study/
https://www.mercer.com/en-us/about/newsroom/employers-are-bracing-for-the-highest-health-benefit-cost-increase-in-15-years/
