Innovative Healthcare Solutions for Forward Thinking Businesses
Direct Primary Care (DPC) isn’t just for individuals—it’s transforming the way businesses approach health benefit packages across the country. This shift is largely driven by the fact employer sponsored health premiums increased on average 7-8% last year and are forecast to do the same the next 2 years. This results in a yearly increase of $3000 per family insured with on average $1800 hitting the employer’s books. In addition, we’re seeing a 4-6% increase in deductibles so even though an employer is paying more, the employee is getting less benefits from their insurance plan. This system is broken and unsustainable for many small businesses.
We previously highlighted how direct primary care can benefit individuals. While most employers will see this as a valuable add based on this alone, these same benefits of DPC can help them save money on the backend of their plan. Generally, there are three types of health plans that pair nicely with DPC – high deductible, self-insured and captive plans.
High Deductible Plans
The first is the easiest to implement and is a typical plan that uses a higher deductible to lower the premium costs. By pairing with a DPC doctor, employers can be assured their employees will have cost effective, convenient and accessible options for care as well as the proper care navigation to avoid bringing the deductible into the equation. For example, I once had a patient who went for a routine ultrasound of her heart (Echocardiogram). She elected to use her insurance and did not discuss it with us prior to scheduling. She was billed $2200 with $2000 hitting her deductible (her out of pocket). This same facility charges $120 to perform the same test when paying cash. This is just one example of cost containment in a high deductible plan when paired with DPC. They would also benefit from not having any copay for visits/procedures, reduced medication costs and transparent cash pricing for lab work.
Self-Insured
The next option is self-insurance. In this type of coverage, a business sets aside funds to pay for employee claims directly opposed to paying a separate insurer a premium. This allows them to control more of their plan design and not pre-pay for services that may or may not be utilized by their employees. Without any additional plan design, most self-insured plans have lower costs by avoiding paying for insurance company overhead and desired profit margins. One caveat is the fact these types of plans tend to require around 100 employees minimum.
Captive Plans
Much like self-insurance, a captive allows for the same control over the plan design but can be accessible to a smaller business – some as few as 10-15 employees. The general premise is the same, however the business joins in with a pool of employers (a captive) to spread the risk and reduce costs. To the employee, both self-insured and captive plans look the same as traditional insurance plans – the employer is simply paying the costs directly on the backend.
Forward thinking businesses we work with have incorporated the self-insurance or captive plan with Direct Primary Care as the foundation. Since the employer covers healthcare costs directly, they rely on DPC to guide employees toward the most efficient and appropriate care. For instance, as in the example above, a DPC can direct an employee to pay $120 for an echocardiogram, saving both the employee and the plan money. DPCs like Core Family Practice also reduce specialists’ visits by up to 60%, ER visits by 40% and the cost of medication 20-40%. These savings directly hit the employers bottom line while improving quality of care for their employees.
Some businesses have also created an onsite clinic where a Core Family Practice doctor sets up shop on a recurring basis. Employees can walk off the manufacturing floor or warehouse to be seen in the middle of the day eliminating barriers. This approach enables early detection of undiagnosed medical conditions like hypertension or high cholesterol, supports preventive care with vaccine clinics and smoking cessation programs, and even handles minor injuries like lacerations onsite—minimizing downtime for employees.
Benefit packages are increasingly confusing and navigating can be challenging when the person (broker) who is selling the product does not have aligned incentives.
Contact us today if you’d like to sit down with Core Family Practice to discuss options for your business and how Direct Primary Care can benefit your employees and your bottom line.
