How stop-loss carriers evaluate direct contracts

By HealthMe · Last updated November 1, 2026.

A direct contract fixes an agreement with a provider. Stop-loss insurance is a separate contract protecting the employer under its policy terms. The practical goal is to make sure the employer’s intended care arrangement and the insurer’s reimbursement requirements are understood before care begins.

Do not treat lower prices as automatic approval

Ask the carrier or authorized reviewer to assess the actual arrangement. A program can be attractive on price while still raising questions about eligible expenses, plan wording, documentation, or payment timing. Do not rely on an informal statement about direct contracting in general.

For example, Berkley’s Policy Alignment Option describes endorsements that align selected provisions with the employer’s plan document, subject to underwriting approval. That is an illustration of the importance of alignment, not a statement that every direct contract or HealthMe program is accepted.

Prepare a review packet

Give the reviewer the relevant plan provisions, proposed provider agreement, package descriptions, price schedule, effective dates, and a plain-language explanation of the workflow. Include a sample record showing how the episode will appear in the TPA’s reporting.

Describe who authorizes care, who pays the provider, how payment is evidenced, and how any participant responsibility is collected. Identify any services or fees outside the bundle. Ask what further information the reviewer needs rather than assuming that a bundled invoice will be sufficient in every case.

Ask for written answers

• Will the proposed expenses qualify under this policy and plan document?
• Are there applicable reimbursement definitions, limits, or exclusions?
• What coding, itemization, authorization, and proof-of-payment records are required?
• How do service and payment dates interact with the policy period?
• Is an endorsement or prior approval required before launch?
• Who will resolve a disagreement about a submitted episode?

These are preparation questions, not a universal carrier checklist. The actual policy and the carrier’s written response control. A broker, captive manager, TPA, and insurer may have different roles; identify who has authority to make the coverage decision.

Keep payment responsibilities clear

Provider payment and insurer reimbursement are separate workflow steps. Establish who is responsible for funding care and when that payment is due. Avoid leaving the practice or member to determine which party is waiting on another party after treatment has occurred.

Test the process with a sample episode before launch, then preserve the agreed documentation for each completed case. Revisit the arrangement when contracts, benefits, or policy terms change.

Connect the review to implementation

Once the responsible parties have resolved the coverage questions, configure the TPA and member communications to match the approved structure. A price, a plan amendment, and an operational workflow should describe the same arrangement.

Continue with the employer launch checklist or explore HealthMe for benefits partners.

Start with What is direct specialty care? for the full model comparison, episode example, and FAQs.