Direct Contracting

Direct contracting is where an employer will directly sign a contract with their preferred service provider. It typically takes the form of bundled payment. This is where pre-operative care, operations, and follow-up care become one bundled payment. Or its payment can also be based on the CPT or diagnosis code.

Direct contracting is typically for self-insured businesses with a concentrated employee rate. It allows orthopedic groups to be in direct contracts with larger employers. When the employer goes to the negotiating table with the provider, their main leverage point is steerage, which will provide more volume to the provider. It induces employers to provide better rates to single-specialty orthopedics.

Orthopedic Groups Utilize Direct Contracts

Orthopedic groups with multiple sub-specialties benefit greatly from direct contracts, especially if the practice is in smaller towns. If the employees had been going to their primary care group for orthopedic related issues, they could circumvent many out-of-network charges that come with it.

Moreover, orthopedic groups experience additional referrals as a byproduct of the direct contract. When you pair this with a bundled payment, it lowers the total cost to your practice. These cost savings help cover any pre-operative care, along with any complications that may occur.

Large Employment Groups Do Not Have to Rely on Insurance Companies

Large companies are no longer relying on insurance companies to select healthcare providers for their employees. They are directly negotiating with local healthcare systems and physician groups on contracts for acute care.

This lucrative model can allow orthopedic groups to get their payment faster from the employer. Therefore, direct contract deals lead to a stable payment system. USOA offers smart solutions that increase margins for practices but also pay more than traditional payers.

It Has a New Model better patient outcomes

Direct contracting is still the same core model of removing the middleman from traditional healthcare. This middle entity profits heavily and dictates how much money a practice is reimbursed. Therefore, the practice can potentially regain as much as 40% more than what they were receiving from other contract payors.

Take a More Active Role in Management

The direct contracting program allows orthopedic groups to take a more active role in managing patient care. It also potentially helps them earn shared savings by entering into a risk-based contracting arrangement directly with an employment group.

Providers get to form a strategic partnership by contracting with providers to perform as a collective entity. Do you want to play your part in the direct contracting program, then contact the US Orthopedic Alliance for increased revenue solutions.