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Published on: November 13, 2014
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Summary
Large employers are directly contracting with hospitals to control healthcare costs. This emerging trend presents opportunities and challenges for hospital executives navigating the future of healthcare procurement.
Area of Science:
- Health Economics
- Healthcare Management
- Health Services Research
Background:
- Rising healthcare expenditures pose significant challenges for large employers.
- Traditional healthcare procurement models often lack cost-control mechanisms.
Purpose of the Study:
- To explore the emerging trend of direct contracting between large employers and hospitals.
- To understand the implications of direct contracting for healthcare pricing and hospital strategy.
Main Methods:
- Analysis of direct contracting initiatives by major employers.
- Qualitative assessment of hospital executive perspectives on direct contracting.
Main Results:
- Major corporations like Boeing and Intel are pioneering direct contracting with healthcare providers.
- Direct contracting aims to achieve greater transparency and control over healthcare prices.
Conclusions:
- Direct contracting represents a significant shift in healthcare purchasing.
- Hospitals face strategic decisions regarding participation in direct contracting models.
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