Small practices often have a hard time negotiating contracts with insurance companies.
The reason is that insurance payer are more likely to accept small practice contracts if the healthcare professionals involved in the practice are willing to negotiate on their own.
The smaller the medical practice setup, the more likely it will be willing to accept a long term agreement and the less likely it will be inclined to have its prices increased every time a new provider comes along.
Smaller practices also understand that when they do not receive any reimbursement from an insurance company, they must pass on those costs through higher fees or lower service levels in order for patients who need care during business hours to fill their schedules.
After physician credentialing, payer contracts are a crucial part of revenue generation.
A payer contract is an agreement between a health care provider and a customer that outlines the services provided, payment terms, and other contractual details.
Healthcare providers can increase income by improving payer contract management by examining terms and evaluating payer performance.
More of the payers are willing to negotiate reimbursement rates with small and mid-size physician groups.
The reason for this is that they have been ignoring these healthcare organizations for far too long.
While no one can guarantee that a payer will always be willing to negotiate, the following strategies can help maximize revenue for healthcare providers:
Knowing your worth is the most effective strategy while negotiating payer contracts,
As it demonstrates to others that you are a worthwhile individual.
Someone who understands their own worth has a better chance of obtaining the things they desire in life.
Knowing your value and being able to quantify all areas of your practice can go a long way toward helping you receive higher reimbursement rates.
Private practices that offer their facts, numbers, and data during contract negotiations may receive contract terms that are up to 10% greater than those that rely solely on word of mouth.
The good news is that you can calculate your worth from almost anywhere.
The healthcare landscape is always changing, and payer contract discussions are bound to change and adapt as well.
The present epidemic has made things unpredictable, and the novel coronavirus’s impacts are expected to have far-reaching repercussions on payer-provider interactions long after the pandemic is over.
How to negotiate payer contracts that increase revenue for your practice.
- First thing first, you must be extremely vigilant and practice due diligence when negotiating with payers.
- Payer contract management is essential for not only receiving but also maximizing reimbursement.
- A provider or practice manager should know the rates for the services they provide.
- The number of days a provider has after a service or visit to file a claim should not be too short, as this makes it difficult for the practice manager to stay on top of time constraints.
- The amount of time it takes for a payer to reimburse a provider for covered services. The scope and list of covered services are determined by the payer reimbursement rates. Claim denial dispute procedures.
- Contractual term Renegotiation and termination terms of notice.
- Knowing the codes for all covered treatments, for example, helps that claims are complete and providers get reimbursed for all eligible services they deliver, even if they are not usually invoiced.
- Digging into all the provisions of a payer’s contract also helps provider organizations prevent and fight claim denials because they understand all the requirements for reimbursement on both their side and the payer’s side.
- Understanding common clauses and what they mean will improve payer contract management and help provider organizations protect their revenue.
- Some contracts may state that the payer can change the policies whenever they choose, so be careful about reimbursement policies.
- Payers can restructure networks to include different types of providers, such as specialists. Practices or facilities that do not have certain jobs may be removed from the network.
- Before negotiating with payers, administrators and providers should explore what payers would expect from the negotiation and how they might react to provider demands. Therefore, your team should decide on how to approach contract negotiations.
- When it comes to managing the complexity of payer contracts, small practices may feel overwhelmed, but breaking down the issue can assist in simplifying these critical interactions
- It could be worth it now to include provisions that particularly handle hypothetical pandemics, such as faster payments or waivers of prior authorizations in the event of a worldwide pandemic.
- As a result of increased unemployment and the loss of health benefits related to employment, there is a significant migration from commercial insurance firms to government insurance.
- The majority of folks will wind up on state Medicaid or check into the Affordable Care Act’s possibilities. Unfortunately, some people may be forced to go without insurance.
- Insurance payer contract negotiation strategies can still vary from payer to payer, provider to provider, and the ongoing COVID-19 pandemic will likely make negotiations more difficult and fraught.
How long do contract negotiations take?
Negotiating contract language typically takes 4 to 6 weeks. Depending on the nature and risk of the given contract, this stage may take longer or shorter.