Medical practices often have a tough time negotiating contracts with insurance companies. However, this process is essential to ensure your reimbursement and maximize revenue for your business.
The healthcare industry is constantly changing, and payer contract discussions are bound to change and adapt. Providers can increase income by improving their negotiation skills with payers to drive the best outcomes for their practices.
The payer will likely have asked for a rate increase from state regulators, and the basis for the growth may be helpful to your negotiation plan. For example, if the payer has told the commissioner that provider prices are increasing by 3% annually, you need to get in on the increase. Check your state’s Insurance Commissioner website for these filing documents.
Frequently, payers do not take the time to look into their business with your practice. This is the time to point out how your practice can save the payer money, assuming the payer’s analysis supports your assertion.
Explain why your practice is vital to patients, employers, the community, and the payer. Discuss with the payer if you have quality performance information or have implemented patient-centered or surgical home projects.
Suppose your practice serves a significant percentage of the payer’s patients in your geographic area. In that case, this should be highlighted, especially if other practices in your specialty cannot take on your patients. Be prepared with data about your practice that will be relevant to the payer.
It will be helpful to know how your practice fits into their strategy and whether there is a possibility of the payer channeling patients to your facilities or excluding them.
For payers, “the trend” is significant. They need to predict payment and claims activity to be successful. Whether the trend is up or down, you must know how this will affect your practice about this payer. Let the payer representatives discuss their company’s strengths and challenges collegially. However, don’t let them forget that they are an intermediary; your providers supply necessary medical services to their insureds.
Remember to provide the payer with 5-to-10-year statistics on the CPI, the MEI, and provider compensation trends. This may be helpful compared to your rate increases from the payer over the same period.