How Advanced Primary Care Is Different Than a Hospital Partnership

Organizational leaders know rising healthcare costs and poor employee health are more than just numbers on a balance sheet—they’re challenges that directly impact performance, morale and the bottom line. 

With healthcare costs projected to rise 5.8% in 2025, the third straight year over 5%, savvy employers are taking action and looking for an advanced primary care (APC) solution to reduce costs and improve workforce health.

APC is a care model designed to maximize value — managing high-cost chronic conditions to improve health and lower cost, leveraging value-based referrals, or preventing conditions altogether through comprehensive preventive care for the body and the mind. By getting patients healthier, it lowers their out-of-pocket costs as well as healthcare costs for their risk-bearing organizations, usually an employer, union, or labor fund.

"The data is amazing about the use of primary care. It helps improve so many things — including the patient's experience, their health outcomes, and how long they live. It saves money, which we all know we need to do more of in U.S. healthcare. And despite all those really fundamentally positive points, we're seeing the field actually decline. And in response, many forward-thinking organizations realized they need to do better for their employees, for their union members, and to not just replicate the old system but to think about a new way of delivering it that met the patient's needs. I believe advanced primary care is the answer we need."

Nirav Vakharia, MD, Chief Health Officer - Marathon Health

When it comes to implementing an advanced primary care solution, employers face two options:

• Independent Advanced Primary Care: Also known as direct primary care or employer-sponsored primary care, these private healthcare provider companies partner directly with client organizations to provide their employees and dependents with a value-based, comprehensive care model.
• Hospital Partnership Primary Care: The practice is either owned or strongly partnered with a hospital system, meaning physicians operate under hospital policies, guidelines, and administrative oversight.

While the hospital system partnership model may seem more common and practical, it can come with several drawbacks, including low-value referrals, higher costs, and a diminished patient experience.

Value-based versus volume-based

To truly understand the difference between the two care models, it's important to understand how they work, and, specifically, how they make money. 

Hospital-affiliated primary care tends to follow a fee-for-service, volume-based model, meaning organizations make money on the number of patients they see and the referrals they make back into their own hospital system. As a result, care is often driven by hospital policies, referral pathways, and volume-based incentives. While this model differs slightly when a hospital manages an onsite employer-sponsored health center, it does not fully eliminate the downstream cost ramifications of increased referrals into the hospital-owned specialist network, as well as limitations in the care seen onsite at the client’s clinic.

Independent APC takes a value-based approach, meaning providers are incentivized by health outcomes, not volume, practicing care in a holistic manner and treating as many conditions as possible within their care model. The model prioritizes preventive medicine, behavioral health, chronic disease management, and patient-centered services.

Employers contract directly with independent APC providers for a fixed-cost fee. This provides both security and transparency, as employers can anticipate their costs throughout the year. Patients get more time with providers to address needs and build relationships, optimizing preventive care — usually at no or low out of pocket costs.

Independent APC drives employee engagement

Advanced primary care providers focus on proactive, patient-centered care to drive higher engagement. The model uses data-driven insights to identify risk factors, such as biometrics like HbA1c and blood pressure, and tailored wellness plans to meet employee needs, making healthcare feel relevant and actionable.

Independent primary care also enhances engagement by removing barriers, such as cost, time away from work, and travel, as employees are less likely to seek care when it’s hard or inconvenient. This is especially true for hourly workers, who must decide between pay or a doctor’s visit during the work day. Employer-sponsored APC typically offers convenient access to onsite or near-site health centers as well as 24/7 virtual support. 

This means employees can get care when and where it’s convenient for them, versus being forced to drive to the closest hospital system, which can be non-existent for people in rural settings or organizations with a dispersed workforce. 

APC providers are dedicated, focused, and innovative partners

Independent advanced primary care companies are focused solely on providing value-based primary care to employer populations. Because they aren’t spread over a wide range of specialties and services that aren’t integrated, they become experts in the realities and trends of what they do: providing proactive, comprehensive primary care.

As a result, APC organizations like Marathon are able to drive innovation and evolution to solve for the ever-changing realities of the healthcare landscape, ensuring that they can be flexible, adaptive partners for employers. We are able to be experts in our care model and delivery without competing priorities.

Meanwhile, some hospitals groups are already selling or splitting off primary care centers they opened due to challenges such as maintaining staff and driving enough referrals to create a profit for themselves. Advanced primary care takes work and determination to succeed in creating value for everyone. Dedication and focus are must-haves.

APC favors value-based referrals

Hospital systems often require or strongly encourage referrals within their network, limiting patient and provider choices, and these referrals are often more costly due to hospital-based facility fees.

For instance, an MRI may cost a few hundred dollars at one facility in town and a few thousand dollars at a hospital system in the same community. Without being tethered to the hospital system, independent programs can refer to the most cost-effective option without sacrificing quality.

That’s where value-based referrals change the game. Independent APC have lower specialist referral rates than hospital system direct primary care due to increased time and capacity for follow-up with patients, but when referrals are needed, providers can refer to specialists or hospitals based on patient needs, quality, cost, and other factors.

The hospital’s role in healthcare

While the typical health system approach to primary care has its weaknesses, hospitals will always provide critical healthcare services to local populations. Their ability to effectively treat serious and complex conditions, offer specialty care, and provide emergency services in times of dire need are fundamental healthcare services for communities. In fact, advanced primary care and hospitals are each pieces of a complete healthcare puzzle with primary care serving as the comprehensive preventive and acute foundation and hospitals serving well in the specialty and emergency care arenas.

The goal of advanced primary care is to treat the whole person, leading to long-term health and well-being, ultimately reducing hospitalizations and the need for complex care. APC doesn't replace the hospital but rather truly focuses on foundational prevention and routine care designed to keep people healthy to keep them out of specialist and hospitalization, while providing independent referrals to when needed — not when providers are incentivized to do so.

Whether delivered through onsite or nearsite centers, a Marathon Health Network, or virtual primary care, Marathon Health’s independent APC solution covers about 90% of employee healthcare needs, from onsite prescription dispensing and labs to condition management, wellness coaching, value-driven referrals, and more. 

Learn more about Marathon Health’s advanced primary care model and how it has helped employers and unions improve population health and lowers costs.