ERISA Compliance in Direct Contracting for Healthcare: Challenges for Employers and Providers

Recording of a 90-minute premium CLE webinar with Q&A

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Conducted on Tuesday, October 23, 2018

Recorded event now available

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Course Materials

This CLE course will provide ERISA counsel and advisers guidance on direct contracting between employers and healthcare providers. The panel will discuss the ERISA challenges associated with direct contracting for health benefits, practical and legal considerations in negotiating and drafting agreements with healthcare providers, and other planning methods to ensure employer compliance with ERISA and other rules and regulations.


The rise in healthcare costs has forced employers to consider contracting directly with healthcare providers to minimize expenses and improve the member experience associated with health benefits. Direct contracting arrangements can be complicated and require counsel and advisers to consider all legal ramifications to assist employers and providers.

Direct contracting agreements offer an opportunity for employers and healthcare providers to work together, eliminating the need for some of the services provided by a third-party administrator (TPA). This approach can provide both parties with substantial benefits and a means of taking on and understanding the functions of the payor, administrator and provider in the absence of a TPA. Furthermore, employers and providers negotiating direct contract agreements must ensure compliance with ERISA and other federal and state regulations.

Employer and provider arrangements inclusive of plan administrative services and the assumption of specific responsibilities by the provider are subject to ERISA rules governing service provider contracts and fiduciaries. These direct contracting arrangements must ensure that plan provisions and actions do not run afoul of the prohibited transaction rules or any fiduciary duties under ERISA.

Negotiations must involve careful consideration of the rules and limitations of HIPAA, the Affordable Care Act and other regulations. Counsel must be knowledgeable of federal and state regulations to structure the direct contracting arrangement to secure the benefits to employers and providers as well as avoid compliance claims.

Listen as our panel discusses the federal and state law challenges associated with direct contracting for health benefits, practical and legal considerations in negotiating and drafting agreements, and planning methods to ensure compliance.



  1. How direct contracting fits into an employer’s overall health benefit strategy
    1. Types of employer direct contracting arrangements
    2. Opportunities for direct contracting to change our healthcare landscape
    3. The mechanics of direct contracting between employers and healthcare providers
  2. Ensuring compliance with ERISA, ACA, HIPAA and other federal regulations
  3. State law implications of employer and healthcare provider direct contracting
  4. Priority terms to consider in negotiating and structuring arrangements with providers for health benefits
  5. Health plan design, documentation and participant communications
  6. Best practices for employers in the administration of health plans from direct contracting arrangements


The panel will review the following priority issues:

  • Essential terms to include in direct contract negotiations
  • Ensuring compliance with ERISA prohibited transaction rules
  • Fiduciary duties of employer and provider in direct contracting arrangements under ERISA
  • Plan design and drafting documentation and participant communications
  • Structuring direct contracting arrangements to avoid potential claims and limiting provider discretion
  • Compliance with HIPAA, ACA, ADA and other regulations
  • State regulatory challenges and considerations
  • Best practices in health plan administration for employers and providers


Nash, Susan
Susan M. Nash

Winston & Strawn

Ms. Nash has extensive experience working with employers, vendors, and health plans on health care strategy, design,...  |  Read More

Vela, Lauren
Lauren Vela, MBA

Senior Director
Pacific Business Group on Health

Ms. Vela is the Senior Director of Member Value for the Pacific Business Group on Health (PBGH). She works directly...  |  Read More

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