Why The First Dollar Is The Only Universal Lever In Healthcare

A lot of talk in the healthcare market today is about how to encourage specific types of healthcare use through concepts like alternative health plans, member engagement, network design, and defined benefits. However, members can’t take advantage of these interventions, and plans won’t see results, if the first dollar out of pocket isn’t affordable and easy to pay. 

Members often don’t know what care will cost or when they’ll be asked to pay. This leads to deferred care, deductible avoidance in plan selection, and uncompensated providers— all of which contribute to the out-of-control cost escalation we see today. So in addition to helping 

members begin their care journey, a focus on the first dollar can unlock healthier cost dynamics system-wide. 

Employers who appreciate this dynamic are likely already funding Health Savings Accounts (HSAs) or providing reimbursement for certain services. However, we have seen that financing the first dollar is a cost efficient option that is well aligned to plan design objectives and complements existing consumer-directed benefit strategies. 

Here’s why we believe payers should consider lending a dollar rather than giving members dollars to unlock healthy utilization and ensure plan design innovations have impact. 

Why Financing the First Dollar is a Game Changer 

Out-of-pocket costs play an important role in health plan design. They discourage overuse. However, as deductibles became the primary lever to deflate ballooning premiums, today’s deductibles represent a significant barrier to care, especially when costs often aren’t known up front. While HSA contributions or direct reimbursements can be a good way to address known access issues, funds may be not yet available or insufficient at time of care, leading to uneven access. 

Financing care, on the other hand, can make more dollars available across a wider spectrum of services, leading to better continuity of care and a more personalized experience. The incentive not to overuse care remains, since the member has to repay those dollars. Financing care also

costs plans a lot less than directly funding care. The system needs more impact with lower cost hurdles. 

Payers are experts at pricing health risks and managing coverage operations, but they are not banks. Since health plans have not traditionally offered lending solutions for out of pocket costs, questions about how to price capital and financial risks come up. This is where our experience can shed some light, whether we’re bringing the capital or the plan brings their own. 

Just how much more efficient is care financing? 

Over the past seven years of financing care in partnership with the nation’s leading payers, PBMs, alternative health plans, and large employers, a “golden ratio” has begun to emerge. 

For every dollar of care invested in a care financing program, members access five dollars of care. That means offering Health Payment Accounts or financing embedded into an alternative plan design creates 5x more impact than funding care alone. And members repay those dollars over time with no interest or fees added to their balance due. This ratio will continue to improve as this benefit model drives further engagement. 

Financing care also helps combat the three major inefficiencies that contribute to rising healthcare costs. Dollars are available on demand, which combats deferred care. Members are significantly more likely to embrace lower cost health plans with cost sharing, and providers are paid in full, which eases pressure on rates. 

Embedded Financing is the New Frontier 

Financing is becoming a standard of care for plan design whether it’s an individual market Qualified Health Plan, a Commercial Group Plan, or an Alternative Health Plan design. The introduction of the Medicare Prescription Payment Plan this year also shows that the "pay over time" concept is resonating across all lines of business where plans include cost sharing. The financing strategy shouldn’t be an afterthought, rather a core pillar of plan design. 

Plans that want to boost engagement should consider financing solutions that can multiply their investment into five times more in strategic healthcare spending. This is a new concept that is ripe for creative use across the entire insurance market. If this sparks anything for you, we’d love to share more about our experience. Please reach out to us or visit our booth #3212 at HLTH 2025.