Don’t Tell Us Payer Contracts Can’t Be Successfully Renegotiated. See For Yourself.

With inflation reaching record levels, many medical practices are undergoing the rate negotiation process with insurance companies to secure better compensation. If you have never done this before, do not worry. We will provide insights into dealing with commercial insurance companies for rate negotiations. The process is often complex and challenging by design. Insurers may deliberately make the process opaque in an attempt to offer lower rates and create confusion.

Everything Is Meant To Be Confusing

The entire process is, in our opinion, meant to be confusing. However, with a bit of effort you can figure out how to navigate the process and succeed.

Many insurance websites do not even have the name of the person listed that you are supposed to contact for rate negotiations. You will find yourself emailing various people before finding the right person to talk to.

It takes a lot of time to figure out who your contact with insurance companies even is. For example, you can go to Cigna’s website and find how to become in network. Once you email, then they can take up to 2 weeks to respond to every email you send. The process is frustratingly long.

How to Make a Medical Practice More Profitable

This practice, as with most, did not have a clear picture of this payer. Not only was the contract never renegotiated (6+ years), but under-billings also existed. Our focus here is the successful renegotiation.

Every dollar is critical, and your payer contracts and fee schedules must be managed properly, no matter what the size of your practice.

Annual Increase For Just One Payer Alone

The Client’s Current Rates, Receipts and Units Billed are based on Jan. – Sept. 2023. New Rates had taken effect for the client 1/1/2024. Now, we have had a full year (2024) to perform year-to-date analysis. Results will vary,

Renegotiations are not always easy; some may not garner you the 6-digit increase this client now enjoys but this is such a critical aspect of your practice, it must be done.

Five (5) Things To Provide Insurance Companies That May Help Negotiate A Higher Rate

(1) Always be kind, professional, and direct on what you’re looking for. No rambling emails, no fiery language that is derogatory.

(2) Include your name, practice name, and Tax ID in every email.

(3) Collect a list of lives that you care for under their insurance plan and present them with that number, the growth that you have had, and how many examples you could easily find of keeping their patients out of the ER. Basically, show them how you are saving them money.

(4) Show them the growth of your practice by numbers of patients.

(5) Jump through their hoops and get everything well ahead of time so you know exactly what they are looking for when it comes time for a rate increase.

Difficulties You May Run Across When You Negotiate A Rate Increase

Insurance companies sure do not make it easy to ask for a rate increase. Below are some of the issues you may come up against when trying to ask for a rate increase:

• Insurance companies often times do not list on their website how to ask for a rate increase.
• There is no clear contact information on who to contact for a rate increase on insurance websites.
• Once you find your network representative (if you have one), turnover is high.
• After signing an initial contract, you may have to wait 2 or 3 years before re-negotiating a rate increase.

Note: If you are going to sign a multi-year contract, be sure to negotiate escalators in their fee schedule. Your expenses don’t stay static.

• Many insurance companies have a “window” on when you can apply for a rate increase. Often it is only limited to a 30 days window. Miss that window…you have to wait until next year.
• They can have carve outs on what they will and will not cover. Some things will pay well, others will pay terrible.

Summary

Preparation is key to any project or endeavor, and payer contract negotiations are no different. If you don’t have your ducks in a row, including your fee schedule pricing demands and arguments, you could be shut down before you’re even out of the gate.

From a revenue cycle management standpoint, accurate data is the key to maintaining revenue integrity. By obtaining this data and having it at one’s fingertips, healthcare entities can engage more effectively with payers through the negotiation stage.

The Physician's Advocate in Payer Contracting

If you don’t have the time, resources or expertise we’ll get it done for you.

Gain the advantage of a team that regularly communicates with the nation’s biggest payers, leveraging our experience and partnerships to secure contracts that help you enhance your ROI.

Starting with your top 5 payers, our team partners with you to organize, manage, analyze and negotiate directly with payers to obtain better reimbursement rates and competitive terms, while you focus on patient care.

Contact Us Today (512) 787-1852 or Schedule Your Free Consultation / Demo here.