Handling payer negotiations can be a difficult process as payers never want to increase provider rates without something in exchange. But there are ways to handle these negotiations that can help you get what you want without having to give up too much of what you need. Keep reading to learn more about handling various types of payer negotiations.
How to Manage Difficult Payer Negotiations
Understanding the Basics of Payer Contracts
Payer negotiations are an issue that has been a thorn in providers’ sides for years. As a provider, you know that you must value your work. So why does it take so much effort to have proper reimbursement?
The goal for everyone is to keep their financial status at the top of the pack. This is no different than the pesky companies you must interact with as a medical provider. Payer negotiations work to make this fairer for you, the provider, and to hold those companies accountable.
Start With a Plan
As a provider, your time is very valuable and not something to be taken lightly. By working with an outside company, they’ll be able to provide you with insight and cut down on the time it would take you to create a plan on your own.
Assess the Value of Each Contract
When the team at PayrAdvisors begins handling a new negotiation, taking a look at the different values is a priority.
- Specialty: What is your area of expertise and how do your services compare to others in your field? These can directly impact how much you are able to charge. Comparisons will be drawn to others in similar fields and areas as yours. It is imperative you know your market share and value proposition well and can articulate why an increase in reimbursement is warranted. At PayrAdvisors, we help clients determine what exactly their market share is and the value they bring to payers’ members and your patients.
- Ratings: How are you being ranked amongst your peers? Are your services top-notch, and if not, how can they get there? More comparisons with your peers and maintaining high rankings will be of the utmost importance. Driving quality as a key initiative helps you increase payer contract reimbursement beyond the standard rates.
- Pricing across the board: Are your fees consistent with what you are offering in relation to your competitors? Examining your CPT code usage in depth to ensure you are maximizing your profit. All too often we see clients with charge masters set below a) market competitors or even worse b) below payer allowed rates; meaning you are leaving money on the table. Re-evaluation of your chargemaster is critical in the negotiation process.
Considering Language While Contracting
What is the best strategy to handle discrepancies brought by the payer? Avoiding confrontations and opening up negotiations will ensure the best outcome for you. Providing detailed information that is found in the assessment phase can allow a firmer stand on fee schedules.
There are multiple legal factors at play when devising these contracts. It is easy to find yourself on the wrong side of the contract language without a specialist overseeing this work. Following the advice of a consultant who understands these agreements in their entirety is critical, the following areas should be scrutinized:
- Provider Sided Provisions: Ensuring that provisions are written into the contract for all situations. Without these provisions, you may find yourself in breach of contract. Many payers trap providers into multi-year agreements without explicitly stating it – sneak language like “initial term period of 365 days” or “evergreen” clauses with specific term dates push contracts years down the line, many with no increases baked into the contracts. Understanding the provider side obligations and provisions of your agreements is critical to long term success.
- Reimbursement Language: Contracts often contain paragraphs or even pages long descriptions of how you will get paid. Language may contain items like “RBRVS” or “Lesser of” that ultimately confuse clinicians on how you’ll get paid. When health plans provide proposals or counter proposals they will confuse you by changing what % of CMS or what year the fee schedule is tied to or even which fee schedule is being modified and they do this on purpose. The goal is to present to you what you feel like is an increase but in many cases it’s no change and in some instances, they’ve offered you a decrease. Understanding reimbursement language is the most critical piece when evaluating your existing and proposed managed care agreements.
- Underpayments & Overpayments:. Many contracts have provisions relating to underpayments and overpayments – many payer contracts don’t even include them. This is something that will happen to in-network providers frequently and you must pay attention to it. Ensure you work with an attorney or managed care consultant who can advise and draft language that protects your practice from improper claw backs, future claim offsets or demands for repayments.
Push for Negotiation
Again, your time is money. You need to have an advocate who understands that and is willing to push to get you every penny you deserve. Remember, you do not have to accept the first contract presented to you; you can value yourself and work to get the compensation that you deserve PayrAdvisors is a national managed care consulting advisory firm focused on working with hospitals and large provider groups to ensure they have a proper managed care strategy in place yielding the best overall reimbursement.
Hiring Professionals for Payer Negotiations
There are multiple things to consider when going into payer negotiations which includes:
- Making sure you understand the payer contract.
- Working with you to build a plan/strategy.
- Looking at the contracts and evaluating them for their profitability or loss.
- Making sure there is clear and concise wording in the contract, and explaining it when needed.
- Finding areas where negotiation can be considered, and follow through with those negotiations on your behalf.
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