A New Employer and Physician Coalition Is Pressing Congress on Direct Contracting. One of Its Three Asks Is Changing the DPC Rules.

Legislation by DPC Insider — Policy Desk
#direct contracting#employer healthcare#Congress#ERISA#HSA
Sources: Friday report · Employers, Physicians Join Forces To Expand Direct Contracting · Hearing Recap: Direct Contracting: A Prescription for Lower Health Care Costs · Direct Contracting: A Prescription for Lower Health Care Costs (hearing witness list) · ERISA and DPC, DPC Frontier · IRS Notice 2026-05: Expansion of HSA Availability and Eligibility Under the OBBBA · Home, Direct Primary Care Coalition

A new coalition of employers, physicians and health care companies wants Congress to change the direct primary care rules. That is one of three asks it put to Congress this week, and it is the vaguest of the three, because at least two different federal rules answer to the phrase. For a two-physician practice they point in opposite directions.

Inside Health Policy reported the launch on September 25. The group is pressing Congress to make it easier for employers to buy care straight from providers rather than through an insurer, and its three asks are greater access to health plan data, changes to direct primary care rules, and limits on contract terms its members say impede competition. That report sits behind a paywall. The Friday report from the law firm Ermer and Suter quotes Fierce Healthcare’s account of the same launch and gives the group a name. The Association for Direct Care “will advocate for policies that ease barriers to direct contracting arrangements between employers and providers, boost transparency and support new payment models.”

Two familiar fights, and one that is about DPC specifically

Plan data access and contract terms are arguments employers have been having with insurers and hospitals for years. Neither the Inside Health Policy lede nor the Fierce Healthcare passage quoted in the Friday report names a statute or a clause behind either ask.

The direct primary care ask is the one worth reading slowly, and not because it is new territory. DPC already has federal rules, and it got the important one last year.

DPC sat at a July hearing on direct contracting

On July 1 the House Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions held a hearing called “Direct Contracting: A Prescription for Lower Health Care Costs.” Subcommittee Chairman Rick Allen said in the committee’s own recap that direct contracts may include direct primary care, and that the model “decreases the total cost of claims.”

The witness list shows DPC represented twice over. It identifies Chad Savage as “President, DPC Action; Founder and Physician, YourChoice Direct Care,” so a DPC advocacy organization had a seat, not only a DPC practice. Mark Newman of Nomi Health and James Gelfand of the ERISA Industry Committee testified at the same hearing, where Rep. Bob Onder raised the Health DATA Act, a bill on employer access to plan information.

So the sequence runs from a hearing in July to a standing organization with an ask list in September. That is the normal path a policy idea takes when someone intends to keep pushing it.

Which DPC rules are actually in play

Two candidates, and they pull in different directions.

The first is the HSA rules. For months beginning after December 31, 2025, HSA money can pay a DPC fee under IRS Notice 2026-05, provided the care is primary care delivered by qualifying primary care practitioners and “the sole compensation for such care is a fixed periodic fee.” The number everyone quotes is the ceiling: $150 a month for an individual, $300 for an arrangement covering more than one person, indexed for inflation after 2026.

That ceiling does something narrower than most summaries of it suggest, and the notice spells out exactly what. For reimbursement purposes, it says, “there is no specific limit on the amount of the fixed periodic fee.” Fees that miss the monthly limit “will be treated as medical expenses reimbursable from an HSA in accordance with section 223(d)(2)(C)(v) but will disqualify the covered individual from eligibility for making HSA contributions while the individual is enrolled.”

Read that twice if you charge more than $150. A $180 membership stays payable from an HSA, and the patient loses the right to put new money into one while enrolled. Age-adjusted fee schedules can put some patients over that line and leave others under it, so the consequence lands on the patient rather than the practice. Raising or removing the ceiling is the simplest change anyone could ask for.

The same notice draws a second line that matters when an employer pays. Fees the employer covers, including through a section 125 salary reduction, are not HSA-reimbursable, because “these payments by the employer are not expenses of the HSA beneficiary.” An employer-paid benefit and an HSA-funded membership are two different arrangements.

The second candidate is ERISA, and it is messier. DPC Frontier’s page on the question is blunt: if the employer is paying the DPC fee, the employer’s broker, TPA and HR department will likely treat that decision as part of an ERISA employee welfare benefit plan. The statute reaches “any plan, fund, or program” an employer maintains to provide medical care, which is wide enough to cover a flat monthly fee.

The same page is calmer about what that status costs a practice. It puts the determination on the TPAs, brokers and consultants, who are “collectively tasked with ERISA compliance and this should not materially affect how the DPC practice delivers medical care,” and notes the Form 5500 instructions may not require a filing from a plan with fewer than 100 participants. What it flags as reaching the practice is COBRA: a patient whose job ends can keep paying the fee and stay for up to 36 months.

That undercuts the easy version of the worry without removing it. A safe harbor drafted around what a Fortune 500 benefits department can absorb could still arrive with duties a two-physician clinic has never had to think about.

DPC already has a federal coalition, and this rule already passed

The most likely target is a rule that is already on the books. The Direct Primary Care Coalition represents “primary care physicians, healthcare associations, employers, and others” on federal policy, and its own page says the Primary Care Enhancement Act, “which makes Direct Primary Care compatible with HSA-qualified HDHPs,” passed as part of H.R. 1. Notice 2026-05 is Treasury’s answer to that provision. The ceiling came with it.

So this is a second pass at existing law rather than a first attempt at federal DPC policy. Both groups count employers among the people they represent. What separates them is subject matter: the DPC Coalition organizes around DPC itself, while the new group lists DPC rules alongside plan data and contract terms in a push for direct employer contracting.

What To Watch

Three specific signals, in the order they would arrive.

Bill text with a number on it. The Health DATA Act covers employer access to plan information, and a subcommittee member raised it at the July hearing. A DPC title inside a larger employer-benefits package is the likelier form the DPC ask takes than a standalone bill, so read the titles of anything the Education and the Workforce or Ways and Means committees mark up this fall.

A specific rule, named. Until the coalition says whether it means the contribution-eligibility ceiling, the ERISA treatment, or something else, “changes to direct primary care rules” stays a placeholder. The answer decides whether this arrives at a solo practice as money or as a compliance duty.

Who else signs on. The Direct Primary Care Coalition and the DPC Alliance are two of the DPC-native bodies with something at stake here, and DPC Action’s president already sat at the July witness table. Whether any of them attach themselves to a group whose center of gravity is employer benefits policy will say a lot about who ends up drafting the language.