Direct Employer Contracting: A Solution To The Unsustainable Cost Of Employee Healthcare Benefits

Apr 27, 2021

Increasingly, employers that provide health benefits to their employees are looking for solutions to address the ever-increasing premiums. For most companies, this is the biggest budget line item apart from payroll, and this expense has risen yearly over the past decade to the point where continued increases are not sustainable. These same benefits have increasingly shifted a larger portion of the cost of care to the actual employee in the form of high deductibles which can be several thousand dollars. As such, employers, particularly those that are self-insured are increasingly looking for lower cost, higher quality solutions for healthcare that provide transparent pricing and can avoid commercial insurance platforms all together.

Direct employer contracting is one such option. It allows employers to contract health services directly with providers and centers of care with fixed transparent pricing avoiding the need for insurance and using a direct payment model instead. Multispecialty surgery centers that provide GI, ENT, orthopedics, ophthalmology and general surgery can contract directly with employers and provide concierge level care with high quality and a price point that is often at half that of hospital-based care. 

Our practice is leading the way in New England by offering fixed price orthopedic care for hip, knee and shoulder diagnosis. Surgical procedures can be performed at Stratham Ambulatory Surgery Center for a single, bundled price that includes all fees related to the day of surgery. PACE, Inc (Personalized Ambulatory Care Excellence) is a subsidiary of our practice that manages the contracting with employers as well as the bundle itself so that the employer only must pay one fee for the surgical episode of care. This is an innovative healthcare solution that puts the employer and the providers of care in control and eliminates the cost and bureaucracy of the insurance business. While relatively new, this service line will grow considerably in future years. Our early experience in bundle management puts our practice ahead of the game when it comes to the New England market. If you are interested in learning more, please reach out to us for more information.