An Introduction to Direct to Employer Contracting (D2E)
Direct to Employer (D2E) contracting enables organizations to contract directly with healthcare providers—bypassing traditional insurance—to deliver tailored healthcare services. From bundled PT offerings to onsite care, D2E aligns incentives, improves access, and delivers measurable results. It’s a growing trend as providers face fee-for-service headwinds and employers face rising costs—in a recent survey, 75% of employers reported having conversations about direct contracting.
What Is Direct to Employer Contracting?
Direct to Employer contracting is a model where a self-insured employer establishes a direct agreement with a care provider group—like a physical therapy practice or health system—for employee health services, removing insurance intermediaries. Contracts can cover specific services or broader care needs under negotiated fee schedules.
Why D2E Matters in Physical Therapy
Direct to Employer (D2E) models in physical therapy open new doors for how care is delivered and paid for. Instead of relying on insurance claims or reactive care, practices can proactively serve employees through programs built around prevention, access, and measurable results.
D2E contracts may include access to onsite or near-site clinics, virtual care, condition-specific bundles, or monthly service packages. These arrangements improve care access—particularly for musculoskeletal conditions, which are a top driver of employer healthcare costs—and create direct relationships between providers and employers, with aligned financial incentives.
How D2E Contracts Work in Practice
D2E contracts vary in structure—ranging from bundled surgery pricing and occupational health packages to ongoing wellness and telehealth services. Employers benefit from predictable costs and outcomes visibility, while providers gain faster payments, streamlined administration, and richer relationships with their employee-patients.
Common Question: How Is D2E Different Than Workers’ Compensation?
While both D2E and workers’ compensation involve employer-paid care, they’re fundamentally different in structure and intent:
D2E is often part of a broader health and performance strategy, while workers’ comp is regulatory and injury-specific. With D2E, providers can engage earlier—before pain becomes a claim—helping employers reduce absenteeism and avoid long, expensive treatment cycles.
Benefits & Challenges of D2E Models
Benefits:
- Direct cost savings by eliminating insurer overhead
- More efficient care through early intervention and conservative care
- Stronger alignment of provider/employer goals
Challenges:
- Contract complexity and negotiation effort
- Scale requirements (depending on the size of the practice and the employer)
- Need for analytics, data sharing, and compliance infrastructure
Conclusion
Direct to Employer contracting is reshaping care delivery—especially for PT providers—through focused services, aligned incentives, and streamlined operations. While setup demands strategy and systems, D2E models deliver impact—cost savings, improved access, and stronger partnerships.
Second Door is here to help practices get their D2E programs off the ground with unified systems to support everything from prospecting to reporting, even professional sales support to guide pitching and contract negotiations. Request a demo to see what this looks like for your practice.
