8330 Allison Pointe Trail, Indianapolis, IN 46250
Direct-to-Employer (DTE) Plans
The DTE strategy is established when Hospital/Health System “directly” contracts with a self-funded employer down to 2 employee lives (in most states) to supply healthcare services. The core value proposition is that Hospital/Health System is the center of the relationship with the employer – not an insurance carrier. The financial incentives include a gain sharing arrangement if an employer plan achieves a favorable claims cost variance to the budget. The DTE strategy incorporates plan designs that financially incent members to use Hospital/Health System medical providers and adhere to protocols intended to address gaps in care and to manage appropriate utilization.
There are 5 main reasons why the DTE program is a strategically important addition to Hospital/Health System. They are:
It has the real potential of producing millions in NEW incremental net revenue in less than 3 years
It levels the playing field with the large insurance companies by enabling the development and control over Hospital/Health System's own network
It provides an opportunity for employers to directly connect with local medical providers without a middle man for better patient care and lower costs
It provides Hospital/Health System and its providers a “low risk” and robust source of new fees and revenues which includes a large share of the savings for performing the services you already provide
It increases Hospital/Health System’s ability to achieve the Triple Aim – increased satisfaction, better outcomes and reduced cost
The positive financial impact occurs when Hospital/Health System is the primary medical delivery system and all plan designs restrict access to any other provider except in instances of emergency care or medically approved referrals to other non-affiliated providers. There are also other revenues from fees, gain share distribution, AND allocation of medical services not otherwise paid in major medical plans – e.g., regimens of care medical services for the chronically ill. Net revenues can increase dramatically in the direct catchment area when moving from the current passive PPO arrangements to an exclusive plan design and network structure. This dramatically increases incremental income, incremental margin, non-medical revenues, and IP/OP market share.
Download the following documents:
Direct-to-Employer White Paper:
Why The Key Family?: