When searching for a healthcare plan, employers seek the best benefits for the most value within budget. The industry is currently dominated by brokers and insurance carriers that offer pre-set packages at high premiums. This lack of cost transparency creates a dynamic that’s difficult to manage – direct contracting solves this by connecting directly with healthcare providers.
But what exactly is direct contracting, and how does it differ from the current market? Beth Johnson, co-founder of D2E Health Plans, explains how this approach provides a better solution.
“Direct contracting is a strategy used to help employers deliver quality, affordable healthcare for their employees. We connect employers, employees, and medical providers and align the incentives of each to create an employer health plan where everyone wins. Employees receive high-quality care while reducing out-of-pocket costs. Employers can offer a health plan that’s a competitive advantage for their company while reducing OpEx. In exchange for lower costs for services, providers receive patient steerage through benefit design and can focus on patient care. Aligning the incentives of all parties is the key here.”
When asked about how effective this strategy has been, Co-founder Deke Lape stated:
“We set out to simplify the process of saving employers and employees money. Since the rollout of our “Direct to Employer” healthcare model in 2014, D2E Health Plans has provided customers a unique experience in a couple of ways.
First, we give employers access to discounted contracts for top-tier medical care. Our clients experience a significant reduction in claim payments when using providers within network. As a result, we can lower deductibles and copays up to 70%. We also provide reporting that shows the employer where funds are spent which allows for better decision-making. The traditional healthcare model isn’t transparent, which creates a situation where people accept rate increases and plan designs that aren’t favorable. Our data-driven, supply-chain management approach consistently reduces healthcare costs for businesses anywhere from 20-40%.
To use an analogy, consider your cable TV provider. Even the cheapest plan will have all of those channels that you never touch, and yet you are paying for access to them every month. Wouldn’t it be nice to only pay for the ones you want and not the things you’ll never need? That’s what we provide for our clients: the exact plan they want without any of the waste.”
It’s clear that direct contracting will make health plans run more efficiently and give clarity on where funds are spent. With lower deductibles and customizable plans, the network of healthcare providers works together to provide business owners and employees with the best healthcare available and realize significant savings.