Health systems and employers are bypassing insurers to deliver higher-quality, more affordable care

By MICHAEL J. ALKIRE

Employee health plan premiums are rising along with the total healthcare spending tab, spurring employers to rethink their benefits design strategy. Footing the tab, employers are becoming a more active and forceful driver in managing wellness, seeking healthcare partners that can keep their workforce healthy through affordable, convenient care.

Likewise, as
health systems assume accountability for the health of their communities, a
market has been born that is ripe for new partnerships between local health
systems and national employers in their community to resourcefully and
effectively manage wellness and overall healthcare costs. Together, they are bypassing traditional
third-party payers to pursue a new type of healthcare financing and delivery
model.

While just 3 percent of self-insured employers are contracting directly with health systems today, dodging third parties to redesign employee benefit and care plans is becoming increasingly popular. AdventHealth in Florida announced a partnership with Disney in 2018 to provide health benefits to Disney employees at a lower cost in exchange for taking on some risk, and Henry Ford Health System has a multi-year, risk-based contract with General Motors.

The notion of bypassing payers is attractive for employers, especially on the back of consecutive cost increases they and their employees have swallowed over the last several years. Payers have traditionally offered employers rigid, fee-for-service plans that not only provide little room for customization, but often exacerbate issues with care coordination and lead to suboptimal health outcomes for both employees and their families. Adding to this frustration for employers is the need to manage complex benefits packages and their corresponding administrative burdens.

The
direct-to-employer model is necessary, but hard to get right

In a
direct-to-employer contract, a health system partners with an employer to
create a customized health plan that is based on predictable outcomes and
provides healthcare services that

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