Direct Contracting with Businesses by Family Physicians 

Direct contracting is a payment model where employers contract directly with a physician or physician group to provide employees and their families access to a range of primary care services. American Academy of Family Physicians (AAFP)supports the physician and patient choice to, respectively, provide and receive healthcare in any ethical healthcare delivery system model, including through a direct contracting model.

Care for covered employees and their families under these direct contract arrangements may be provided in the physician’s primary practice location or at a worksite clinic. Services may include:

• Comprehensive primary care services for acute and chronic care
• Wellness and preventive services
  
• Traditional worker’s compensation services, return to work, and stay at work programs
• Occupational health screenings (drug and alcohol testing,
  Department of Transportation requirements, Federal Aviation
  Administration physicals, etc.)

Physician payment in these contracts may be based on some combination of:

• A negotiated per employee per month fee
• A negotiated flat fee that covers the total cost, including fees for the physician or any non-physician providers involved in patient care
• Co-payments paid by the patient

Direct contracting can provide relief from administrative burden and enable physicians to spend more time with their patients, both in face-to-face visits, and through telephonic or electronic communications mediums should they choose, since they are not bound by insurance reimbursement restrictions. This model can provide numerous benefits for employers including reduction of health care costs, increase in employee satisfaction, and decreased employee absences or sick days. Contracting directly with employers is a key component of many direct primary care practices allowing them to grow and even scale their practice. For these reasons, direct contracting is consistent with AAFP advocacy for advanced primary care functions and as an
innovative alternative to fee-for-service.  (April Board 2010) (2020 COD)