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June 19, 2017 by
aliereadvisors
Direct Primary Care (DPC) healthcare is on the rise. One of the reasons that it is gaining popularity is because it reduces the cost of providing healthcare incurred by employers.

Not only has the cost of healthcare risen for employers, but it has also become increasingly difficult for employers to provide the same level of insurance to their employees as far as coverage goes.

In recent years, many employers have begun shifting some of the cost to employees by offering healthcare plans that have high deductibles. CNBC cited that in 2015, the average general deductible for workers with single coverage was $1,077, whereas in 2006 it was only $303.

The same year, 46% of employees (with single coverage) had a deductible of $1,000 or more, whereas that number was only 10% in 2006. That means that average healthcare deductibles grew seven times quicker than that of wages in that time span.

As of now, healthcare is costly not only for employees as far as their deductibles go, but for employers as even offering these plans means that they incur quite a cost to their business.

In this article, we explore just how offering DPC to employees helps to cut costs on a company level. Keep reading to learn more!

How is DPC reducing healthcare costs for employers?

It decreases hospital and ER visits

Imagine MD reports that research shows that patients enrolled in DPC experienced fewer visits to the ER and fewer hospital stays than those utilizing more traditional insurance models. There are several contributing factors to this.

First, patients with DPC have an easier time scheduling prompt appointments with their doctors, as those with traditional insurance experienced an average of a 20-day wait time for an appointment with their primary care physician (according to a Merritt-Hawkins survey in 2013).

Plus, on average, these appointments only lasted 15.7 minutes. Furthermore, even in Urgent Care centers, once patients arrived at their appointments almost 30% have to wait 21-40 minutes to be seen by a physician.

The limited time with doctors is a contributing factor in patients experiencing more hospital time overall, which drives up insurance costs for employers.

For patients that have DPC and can easily get an appointment with their physician whenever it is needed and can also have an abundance of one-on-one time with them, they are less likely to need hospital care. This keeps costs for employers down.

Costs are more predictable

Because a “retainer” is paid upfront for doctor care in a DPC model, either by the employer, the patient, or by a combination of the two, costs of healthcare are much more predictable for companies. In a traditional insurance model, healthcare costs can be rather unpredictable, making it more difficult for a company to plan.

There’s a tax benefit

Finally, the retainer paid in conjunction with DPC is – in most cases – able to be written off as a business expense. This means that the actual cost to a business will be reduced by a percentage equal to its total corporate tax rate, which can be quite a savings.


There are clearly many ways that a DPC plan can help to save your company money when you offer this insurance model to your employees. It is definitely something to consider from an economical standpoint as well as for many others.

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