Keepwell Health Union

A nonprofit healthcare cooperative

Executive Summary

Keepwell Health Union is a nonprofit, clinician-led healthcare cooperative designed to provide high-quality, humane, and cost-predictable care by removing insurance from routine medical decision-making and confining it to catastrophic risk where it belongs.

Keepwell delivers primary care, mental health, urgent care, diagnostics, and care coordination directly to members through employer-based enrollment. Rare, high-cost events such as major surgery, trauma, or complex hospitalization are protected through external reinsurance (stop-loss coverage), ensuring financial stability without reverting to traditional insurance models.

The result is a healthcare system that is simpler, more transparent, more humane, and economically sustainable—without denying care or shifting risk onto patients.

The Problem

The U.S. healthcare system is not failing because of bad medicine. It is failing because of distorted incentives.

Key dysfunctions:

• Insurance intermediaries sit inside routine care decisions
• Providers spend enormous time on billing, coding, and authorization
• Employers face unpredictable cost increases with no leverage
• Patients experience delays, denials, fragmentation, and confusion
• Clinicians burn out under administrative load rather than medical complexity

Most healthcare spending is predictable and preventable. The system treats it as adversarial and opaque.

Core Idea

Separate healthcare delivery from catastrophic risk management.

• Routine and preventive care should be delivered directly by clinicians
• Rare, high-cost events should be insured at the system level
• Members should belong to the system, not shop for it
• Governance should prevent profit extraction from care decisions

Keepwell Health Union implements this separation structurally.

Organizational Structure

Legal form: Nonprofit healthcare cooperative

Governance principles:

• No shareholders
• Explicit prohibition on for-profit conversion
• Clinician representation in governance
• Member-first fiduciary responsibility
• Financial transparency

Membership model:

• Enrollment through employers (primary channel)
• Employers fund care on a per-member basis
• Members receive care, not insurance policies

Scope of Care (Initial Launch)

Included services

• Primary care
• Mental health (therapy + psychiatric care)
• Urgent care
• Labs and basic imaging (partnered)
• Care coordination and referrals

Excluded initially

• Inpatient hospitalization
• Major surgery
• Oncology, NICU, trauma care

These are handled through negotiated provider relationships and reinsurance protection.

Reinsurance (Catastrophic Coverage)

Keepwell does not sell insurance to members. Instead, it carries external reinsurance to protect the cooperative against rare, extreme costs.

Types of coverage

Specific stop-loss

• Protects against high-cost individuals
• Example: Keepwell covers first $250,000 per member per year
• Reinsurer covers costs above that threshold

Aggregate stop-loss

• Protects against population-wide cost overruns
• Example: Expected annual spend $15M, attachment at $18M
• Reinsurer covers costs above attachment point

Why this works

• Reinsurance engages only for rare events
• No claims handling for routine care
• No interference in clinical decision-making
• Predictable costs for employers and members

Insurance is confined to what it does best: tail risk.

Why This Will Work

1. Employer-based enrollment solves adverse selection

Whole workforces enroll together, creating stable, predictable risk pools. This model is already accepted and understood by regulators and employers.

2. Most healthcare utilization is routine

Primary care, mental health, and urgent care account for the majority of interactions. Removing insurance friction here produces immediate cost and access improvements.

3. Clinician incentives are restored

• No prior authorizations
• No billing games
• Reasonable patient panels
• Time to practice medicine

This directly improves outcomes and retention.

4. Reinsurance removes existential risk

Keepwell never carries unlimited downside. Catastrophic events do not threaten solvency or force care rationing.

5. Surplus becomes resilience, not extraction

Any operational surplus is reinvested into:

• lower employer costs
• clinician pay and staffing
• expanded access
• improved facilities
• financial reserves

Staffing Model (Initial Metro Launch)

Target population: 2,000–5,000 members

Clinical staff (approx. for 3,000 members):

• Primary care physicians: 3
• Mental health therapists: 6–8
• Psychiatrist: 1 (part-time acceptable)
• Nurses / medical assistants: 6–8

Operations staff:

• Clinic manager
• Care coordinator
• Front desk / scheduling
• IT / systems (fractional initially)

Total staff: ~20–25

Panel ratios are capped and monitored to prevent overload.

Facilities

Space requirements:

• 3,500–6,000 sq ft
• Exam rooms, therapy rooms, shared spaces

Location strategy:

• Vacant urban storefronts or light commercial space
• High visibility, community-integrated clinics
• ADA-compliant, modular buildout

Startup Costs (Estimated)

One-time costs

• Buildout: $750k–$1.25M
• Medical equipment: ~$300k
• IT systems (EHR, scheduling, telehealth): ~$150k
• Legal, compliance, setup: ~$150k

One-time total: ~$1.5–2.0M

Ongoing Annual Costs (Estimated)

• Staff compensation: ~$3.0M
• Rent & utilities: ~$350k
• Labs, vendors, misc: ~$500k

Operating total: ~$3.8–4.0M per year

Revenue Model (Illustrative)

Employer contribution example:

• $450 per member per month

3,000 members × $450 × 12 = ~$16.2M annualized

This supports:

• full operations
• reinsurance premiums
• reserves
• reinvestment

Role of Philanthropy

Philanthropy is used as infrastructure capital, not operating subsidy.

Funds support:

• clinic buildout
• early operational runway
• technology
• negotiation leverage

Once launched, Keepwell is self-sustaining.

What Success Looks Like

By 6 months

• 2,000 members enrolled
• Primary care access < 48 hours
• Mental health access < 7 days
• High clinician satisfaction

By 12 months

• 4,000–5,000 members
• Second clinic planned
• Reinsurance fully optimized
• Employer renewal rates > 90%

Conclusion

Keepwell Health Union is not an attempt to “disrupt healthcare.” It is an attempt to remove unnecessary harm from a system that has forgotten its purpose.

By restoring clear incentives, constraining insurance to its proper role, and designing governance that resists extraction, Keepwell offers a durable, humane alternative that can scale metro by metro.