This article is part of Frier Levitt’s DTE Conference Insights series, highlighting key discussions from the inaugural Direct-to-Employer Conference co-hosted by Frier Levitt and the Northeast Business Group on Health (NEBGH).
At Frier Levitt and the Northeast Business Group on Health’s (NEBGH) inaugural Direct-to-Employer (DTE) Conference, the second panel, which focused on DTE models for specialty care, examined the unique challenges and opportunities associated with extending DTE arrangements into the specialty care space. The panel was moderated by Daniel Frier, and panelists included Jack Feltz, M.D. (Lifeline Medical Associates), Doug Geinzer (High Performance Companies), Edward J. Licitra, M.D., PhD (Astera Cancer Care), Ted Okon (Community Oncology Alliance), and Krista Stock, MHA (U.S. Women’s Health Alliance). Building on the primary care foundations discussed in Panel 1, panelists explored how specialty care contracting differs in structure and complexity, and why certain specialties, particularly oncology and obstetrics and gynecology, present compelling opportunities for employers seeking to improve care quality while containing costs.
How Specialty Care Differs from Primary Care in DTE Models
Panelists emphasized that specialty care in DTE arrangements involves distinct considerations compared to the primary care-focused models discussed earlier in the program. DTE specialty care models typically incorporate bundled payment structures that encompass the full scope of services associated with a given episode of care, including laboratory services, facility fees, surgeon and procedure costs, and potentially device costs (e.g. implants). These bundled arrangements allow employers to negotiate comprehensive pricing for a defined course of treatment, providing greater cost predictability and eliminating the fragmentation that characterizes traditional fee-for-service specialty reimbursement.
Oncology: A Great Opportunity for Growth
A significant portion of the panel discussion focused on oncology as the specialty with the greatest potential for growth in DTE contracting. Panelists observed that advances in medicine have fundamentally transformed cancer care from an acute intervention into a long-term, continuity-of-care model. Cancer treatment today more closely resembles chronic disease management than the episodic, acute-care paradigm it was once considered to be. This evolution makes oncology particularly well-suited to bundled DTE arrangements, where contracts cover a defined period of time and a comprehensive set of services along a treatment pathway.
Panelists noted that when patients are placed on the correct clinical pathway early in their course of treatment, both care quality and cost containment improve meaningfully. DTE oncology arrangements benefit both patients and employers. Patients receive community-based, more individualized, and higher-quality care that is unconstrained by traditional insurance structures such as fee-for-service reimbursement, while employers can realize significant cost savings. As discussed during the panel, cancer care delivered in the hospital setting can cost four to five times more than the same type of care provided in a community oncology practice setting. This cost differential represents a substantial opportunity for employers to achieve significant savings through DTE arrangements that direct members toward high-value community-based oncology providers.
Obstetrics and Gynecology: A Lifecycle Approach to Women’s Health
The panel also explored the transformation of obstetrics and gynecology care and its suitability for DTE contracting. Panelists discussed how OB-GYN has evolved from a narrow focus on obstetrics to a broader, lifecycle-oriented view of women’s health, spanning from puberty through post-menopause care. This expanded scope aligns OB-GYN more closely with primary care, as discussed in Panel 1, making the specialty particularly conducive to DTE benefit arrangements.
Panelists highlighted the cascading benefits of improving women’s healthcare through DTE models. Improved health outcomes for women transform health outcomes for their families as well, which can reduce unnecessary medical expenses for employers across their covered populations. Similar to oncology, community-based OB-GYN practices can provide more specialized, individualized, and higher-value care compared to the same procedures delivered in a hospital-based setting. Panelists identified OB-GYN as another area of significant opportunity for DTE growth, particularly where employers can direct members to community-based providers offering superior outcomes at lower cost.
Setting Employers Up for Success in Specialty Care DTE Models
The panel concluded with a discussion of how employers should plan and position themselves for success when implementing DTE models in the specialty care space. Panelists identified several critical operational priorities:
- Tracking utilization and cost containment through robust reporting infrastructure is essential for employers entering the specialty DTE space. Employers must have the capability to identify trends, particularly opportunities to shift care from hospital-based settings to community and practice-based environments where outcomes and value are demonstrably higher.
- Establishing and monitoring quality metrics and outcomes data allows employers to measure whether their DTE arrangements are achieving their intended goals of better patient outcomes at reduced cost.
- Investing in care navigation services helps members reach high-quality, lower-cost specialty providers. Navigation is particularly important in specialty care, where patients may lack the information or resources to identify optimal care settings on their own.
- Identifying and acting on opportunities to bring care back to community-based and practice-based settings rather than defaulting to hospital-based care remains a central strategy for maximizing the value of DTE specialty arrangements.
Engage Experienced Benefits Counsel
DTE healthcare models in the specialty care space represent a significant frontier for employers seeking to improve care quality and reduce costs. Organizations considering or currently operating DTE arrangements in specialty care should engage counsel with deep experience in the specific regulatory, compliance, and privacy issues unique to these models, such as compliance audits, risk mitigation strategies, contract drafting and review, and ongoing legal support. Contact Frier Levitt for assistance with the development or review of your DTE model.
