“I continually think that half the problem out there is on the physician side,” says Todd Welter, whose Denver-based Welter & Associates helps physicians negotiate with payers. “I’d be the first one to blame payers for whatever I can, but some of this is the physicians’ fault.”

Payers also lose money when there are a lot of denials and processing mistakes. Every time you have to call a payer, it costs them money just as it costs you. Generally speaking, payers aren’t out to “get” physicians.

Jamo Rubin, MD, founder and president of MPV, a software and services company that facilitates smoother payments and contracting, insists it’s wrong to look at the payment process as a battle. “It’s not doctor against payer; it’s the inability of the information systems to work together in a completely open way. … These worlds [physicians’ and payers’] are closer together than they are farther apart.”

Public policy issues aside, what does all this data mean when it comes to contract renewal time for individual practices? Do you drop low-ranked payers? What if they pay well?

Certainly, physicians should consider the hassle factor in getting paid for their services. “Are you cheating yourself if you’ll get half a percent more in pay from a payer, but have a huge hassle? If you are negotiating with Humana, you might want to take a slightly lower fee because you will get paid,” suggests Delinsky.

Welter also suggests making objective measures of payment efficiency part of your negotiation process with payers. “With established practices, I try to get them to rate the pain-in-the-neck portion equally to rates. That is [how] we come up with whom to go after first. Even a decent reimbursement rate doesn’t mean anything if you spend all the money trying to collect.”

Your analysis needs to be objective, he emphasizes. “It can’t be emotional. If you can’t submit a clean claim, it’s not the payer’s fault.”

Rubin of MPV suggests data about payer performance are best used to fix the process, not to make a go/no-go decision on a contract. Wise physicians “try to understand what specific issues are causing the problems,” he says. Analyze your own payment data and look for patterns for particular payers and particular products. When you find them, ask if the problem is caused by something on your end — submitting bad claims, misunderstanding coding rules — or is it something the payer’s systems can’t handle automatically. Look for a work-around that will make payment faster and more accurate. “It’s a feedback loop, not necessarily for a better rate but for a faster process,” says Rubin. “That’s a mutual benefit.”

For example, he cites one practice that realized one payer denied or slowed down every claim with a -62 modifier. The payer couldn’t process it; it was a claims-processing problem, not a contract problem. So, working with the payer, the practice figured out how to tweak the percentage reimbursement on other line items. The -62 still got denied, but the practice got its money anyway.

“You need deeper understanding of what the payer is having problems with. That elevates the conversation big time,” says Rubin. “You are talking to them unemotionally, with data, and at a higher level. It begins to take on the tone of a contractual discussion. And that gets people’s attention. … They understand that … you are not here to start a war; you are here to solve a problem.”

Pamela Moore, PhD, CPC is senior editor, practice management, for Physicians Practice. She can be reached at pmoore@physicianspractice.com.

This article originally appeared in the June 2006 issue of Physicians Practice.