A New Healthcare Model: Frequently Asked Questions

When you embark on a journey to completely disrupt the health insurance status quo, you’re going to have a few questions along the way. Here are answers to the most common questions employers have about direct partnerships – a new healthcare model that is creating better outcomes for employers and members.

What is a direct healthcare partnership?

A direct partnership is an agreement between an employer and a community health provider. Employers and providers work together directly to provide healthcare for employees and their families.

H2B is your program manager partner. We oversee the development and execution of the program, and we’ll work with your direct provider partner to create a Direct Corporate Health Partnership Agreement

Stop-loss insurance will kick in to cover catastrophic claims. A direct partnership is a form of self-funding, so the employer is also the payer. However, the amount you’ll pay is capped, so your risk is controlled. Reinsurance provides cover for catastrophic claims, such as an employee who needs expensive cancer treatments or who has a baby in NICU care. Although it’s not required, many employers that use the direct partnership model join a captive for the first layer of reinsurance.

Yes. You’ll work with a pharmacy benefits manager to provide prescription drug coverage. For durable medical equipment, you can contract with a healthcare provider or work with a TPA that offers durable medical equipment access. We help you set it all up.

The exact cost will depend on various factors, including the size of your workforce. However, employers typically see savings of at least 20% to 30%. Additionally, the average renewal increase is just 1.9%.

Yes. The direct partnership model is ideal for companies seeking to cover between 20 and 1,000 employees.

Yes! With the direct partnership model, you’re in charge of your plan design, enabling you to craft a plan that controls costs while delivering high-quality care. This is also a powerful recruitment and retention tool. For example, you can opt to cover childbirth at no cost to your team members, providing a high-value benefit that helps your workers and supports your recruitment and engagement goals.

No, a direct partnership does not limit access. Instead, this model incentivizes the use of community partner providers who deliver cost-effective and high-quality healthcare services. This is done through a plan design that uses tiers. When members use Tier 1 providers, they pay one cost. When they use Tier 2 providers, they pay a different cost.

In a small community with only one or two health systems, a direct partnership is a simple and logical solution to healthcare. However, even in larger metro areas with more provider options, the direct partnership model can work thanks to this tiered system.

Yes. Right now, the traditional, carrier-based model is failing many employers. Every year, renewals bring surging prices and send employers and their workers scrambling to find short-term fixes to reduce costs. The direct partnership model is designed as a sustainable alternative. Instead of slapping a Band-Aid on a broken system, we’re creating a new system in which employers and providers are aligned to deliver affordable, quality care.

Implementation is typically done in 90 to 180 days. Most employers decide to make the switch effective on January 1, but you can convert anytime of the year.

When employers switch from a traditional carrier-based health plan to a direct partnership, they’re not taking on more work. They’re just taking on different work.

The initial learning curve can be a little steep because you’re onboarding a totally new system of managing your benefits. Instead of working with one carrier, you’ll be working with your direct provider partner, a TPA, a stop-loss provider, and a pharmacy benefits manager.

However, once you’re settled in your program, things are easier, and you don’t have to worry about the annual disruption and scramble to deal with surging premiums – like you’ve probably been dealing with in the traditional employee benefits model. By taking control of each element of your health program, you’re finally in a position to bring about meaningful plan improvements.