Last month, First Choice Health and rule of three hosted a dynamic national group of health system leaders for our second Direct-to-Employer (DTE) Executive Summit. Discussions addressed the major issues, considerations, and challenges health systems face when deploying direct-contracting solutions. The Summit also explored how health systems can improve and successfully manage a sustainable direct-contracting model that attracts more commercial customers.

The event featured industry-leading early adopters of direct-contracting:  Bruce K. Muma, MD, FACP, President & CEO, Henry Ford Physician Network & ACO, Henry Ford Health System, and Sheila Savageau, Global Health & Well-being Leader, General Motors; as well as a Q&A with Dan Mendelson, CEO, Morgan Health.

Here are some direct-contracting success tips from industry insiders:

  1. A good partnership between an employer and a health system is collaborative, innovative and puts the patient at the center of every decision. For GM and Henry Ford Health, their most essential values align, which has resulted in a working relationship that gives GM employees and their families the quality-focused, value-based care they asked for. In the third year of a five-year contract, both GM and Henry Ford Health appreciate that the other is willing to collaborate, think creatively and put patients/employees first.

  2. Improve quality, and reduced costs will follow. When entering the DTE space, employers often mistakenly identify lowering healthcare costs as the main goal. GM approached this venture with a commitment to quality above all else, with the conviction that increased patient engagement and experience will naturally lead to lower costs. Partnerships driven by quality of care are showing more success than those driven by cost concerns.

  3. Understanding the specific needs of the employee population is critical to finding a partner fit. Success depends on both employers and health systems intimately understanding the health needs of the employees. To achieve this, both organizations need to have a strong data infrastructure and a commitment to regular and robust employee outreach on the topic of healthcare.

  4. Creating a new DTE offering is resource intensive in the beginning but becomes more efficient when the health system and employer relationship is aligned.

  5. Communication and marketing to employees and their families is key to making a DTE offering successful.

  6. Open and ongoing collaboration between the health system and the employer is critical to achieve a program that serves the needs of the employees.

More key observations on healthcare system management:


  • Primary care is best when it's built around a personal, deep, and long-term relationship between doctor and patient; organizations that can curate a culture around deep relationships between care teams and employees are best positioned to win.
  • Timely access to claims data should be the foundation of any value-based DTE strategy centered around primary care. Ensuring PCPs and care teams can risk stratify employee populations to deploy clinical resources effectively and connecting incentive payments to performance in a given period are core elements of success.
  • In-person care remains the foundation for employee health, but virtual and digital solutions must be a core component moving forward. Offering employers an in-person option with wrap-around services such as telehealth and asynchronous messaging is critical to robust primary care.


  • The logistics of bundling and establishing COEs is overwhelming and intimidating for a health system that hasn't entered this arena yet. Finding an administrative partner can help to mitigate this challenge.
  • For health systems just starting to bundle, programs that seem to have the most appeal are fertility/pregnancy, bariatric/weight loss and musculoskeletal bundles.
  • Providers' willingness to support bundled payments depends heavily on their compensation model. When pursuing a DTE bundle, consider parallel changes to provider compensation models to align with the program.


  • Providers are concerned about patients getting the medications they need while keeping costs sustainable. New entrants such as Rightway Healthcare are redesigning PBMs and incorporating care navigation to solve prescribed medication challenges for patients.
  • Brokers and consultants should have a full understanding of what the provider side is doing to represent and deliver messages to clients.
  • Health systems are facing challenges in showing data on the 340B rebate, and therefore, more are focusing on contract pricing.

Thank you to all of the guests who provided their valuable insight at the Summit. Employers and providers alike are interested in learning from each other, creatively solving problems and sharing knowledge, contributing to a more approachable, innovative environment.

There are many more in-depth conversations to be had on this topic. If you would like to attend a future Direct-to-Employer Executive Summit, please contact us at [email protected]

Co-written by Josh Berlin, CEO, rule of three, LLC

Posted In:  Healthcare Industry Innovation

About Anisha Sood

Anisha provides oversight of finance, strategy and corporate development. She joined First Choice Health in 2019 as Vice President of Strategy and Corporate Development, having previously served as a partner at healthcare investment firm Echo Health Ventures, a principal in Cambia Health Solutions' strategic investments group and Vice President of Healthcare Investment Banking at Credit Suisse. Anisha has played a key role in accelerating our partnership efforts and negotiating unique agreements for telehealth, data and analytics solutions, and concierge services.