The Value of Negotiating Your Payer Contracts
Healthcare organizations often find it challenging to negotiate contracts with fee-for-service payers, however, a well-crafted plan can lead to successful negotiations. You may overlook negotiating payer contracts as a potential source of revenue. Yet, periodically reviewing and renegotiating payer contracts can contribute significantly to the long-term financial sustainability of a practice. It is important to consider payer contract negotiations and to approach the process with a data-driven strategy from the experts.
Explore The Value of Payer Contract Analysis!
Typically for healthcare organizations, the responsibility of payer contract review and negotiations falls on the Practice Manager, Office Manager, Chief Financial Officer, or Medical Provider who owns the practice. Majority of the time physicians, who are not as involved in the business side of the practice, may not fully comprehend the extent of their practice’s bargaining leverage. Let us explore the value of the payer contract negotiation as listed below:
- Start by Prioritizing Payers:
To optimize your efforts in contacting payers, begin by identifying your top 5-10 payers by revenue. This list will serve as a useful starting point.
- Establish A Connection with The Payer:
Once you have identified your priority payers, it’s essential to establish direct communication with a payer representative who can assist with your contract. Building a relationship with a live person is crucial to establish rapport and trust, which can ultimately lead to an allyship during payer contract negotiation. Start by reaching out to someone in the credentialing, provider enrollment, or network management department, as they can guide you to the appropriate representative.
- Obtain the Current Contract and Fee Schedule:
The best way to understand what each payer is supposed to reimburse your organization and providers is by obtaining and reviewing an original copy of the contract from the payer. Keep in mind that this process may take 45-90 days when requesting it. Recently, most of the payers require the contract request to be made via email.
- Payer Contract Analysis – “You Can’t Manage What You Can’t Measure”:
By conducting a payer reimbursement analysis, healthcare providers can better understand the financial implications of contracting with different payers and can make informed decisions about which payers to work with and how to negotiate payment rates and terms. Some of the key steps in this process include:
- Identifying the high-volume and high-value medical procedures and services rendered at your medical practice or healthcare organization.
- Reviewing the fee schedules and reimbursement rates of payer you want to negotiate with for above procedures and services.
- Analyzing the payer’s reimbursement policies, such as deductibles, copayments, and coinsurance, to understand how they affect the amount you will be reimbursed for each claim.
- Researching gaps in reimbursement between contracted amounts and payments received for specific CPT’s
- Evaluating the payer’s contract terms and conditions, including exclusions and limitations, to ensure that you are complying with their requirements and maximizing reimbursement.
- Gain Insight into Your Value Within the Network:
Evaluate your ratings on social platforms and focus on setting yourself apart from other providers in your area to provide added value to the payer network. Consider what unique services you offer that the payer would find beneficial beyond just the size of your practice, or the revenue generated. Do you provide preventative care that reduces the number of emergency room visits? Do you offer convenient office hours that patients appreciate? Strive to build additional value for your patients and therefore the payer.
- Build Relationships with Payers:
Create a plan to communicate regularly with your payers. Payers are interested in hearing about how you are improving the quality of care you provide, increasing value for their members, and reducing costs to steer more patients toward high-value practices. If you only reach out to payers when you want to payer contract negotiations or have issues, they may not be interested in speaking with you when you are seeking higher reimbursement rates. Building trust and nurturing payer relationships is crucial for establishing mutually beneficial partnerships.
- Recognize the Differences Between Payers:
Not all payers are created equal, therefore, it is important to recognize that the approach you use to secure contracts successfully with one payer may not work with another. Are you collecting payer contracts? Are you negotiating? Different payers utilize different channels, and understanding the best one for each payer is vital. As you gain more experience in dealing with payers, you will start to notice patterns and trends that will improve your efficiency.
- Contracting for Multiple Networks:
Frequently, payer contracts will cover various networks such as commercial, Medicare Advantage, and Managed Care. As a result, it is essential to familiarize yourself with how the payer operates with these products. Each payer handles these contracts in a unique way, so becoming acquainted with the language used will be advantageous in navigating them. For example, a significant payer may have a universal contract that complies with CMS regulations, while another major payer may have a contract section for commercial payers that supersedes Medicare Advantage patients.
- Establish Your Unique Selling Proposition:
When requesting a reimbursement rate increase, illustrate the value you offer relative to your competitors. For instance, if your practice offers extended business hours during weekdays or telehealth appointments on weekends, emphasize that. To obtain this data, you can search a payer’s website or online booking service, such as Zocdoc, using your zip code to determine how many physicians practice in the vicinity. As a result, you may be unaware of the market dominance you possess within a few-mile radius.
- Incorporate an Escalator Clause:
An escalator clause is a contractual provision that guarantees a specific payment increase during a defined period. For instance, practices could negotiate a three-year contract but include automatic annual increases of 1%. Thus, you will need payer contract negotiation to resolve the prevailing grievances and issues.
Get Effective Solutions for Payer Contract Negotiation Today!
TriumpHealth’s skilled consultants conduct a thorough payer contract analysis to provide you with a clear understanding of your contract terms and conditions. By doing so, you gain knowledge of your contract terms and the language used by payers. We know that taking on a payer contract negotiation on your own is a time-consuming and stressful task. TriumpHealth has the best payer contract negotiation solutions available at an affordable price. Contact TriumpHealth expert for hassle-free solutions.
You can call 888-747-3836 x0 or email firstname.lastname@example.org to speak to a representative!