You may be able to negotiate for better reimbursement. Here’s what you need to know to improve your chances of success with payers.
If you’re in a small practice, you may feel like David against Goliath when you sit down with payers-a David with no stones in his sling.
However, you may be better armed than you think. If you have a strong case to make and come to the table well-prepared, you might be able to improve your contracts. Of course, being big helps. “The larger the practice, the better your chances,” says Brennan Cantrell, commercial health insurance strategist for the American Academy of Family Physicians, “because if you’re big, the payer has more to lose if you leave. However, I’d never say never. Smaller practices may have more to offer than they realize.”
Tammie Olson, of Management Resource Group, an Ocean Springs, Miss., firm offering financial management and support services for the healthcare community, agrees that smaller practices are at a disadvantage, unless they can prove that the higher rate is affecting their business.
“And how can it not?” she asks. In some cases negotiating is your only option. “Most providers will not even attempt to credential with a payer when they have only one or two patients that have insurance with them. But say a local business changes their employee benefits and now the employees have an insurance the provider is out of network with,” Olson points out. “In order to stay afloat, that provider will have to negotiate with that insurer for competitive rates.”
If you are going to negotiate, you need to do it right. Here are a few tips for improving your chances of improving your contracts with payers:
• Do your homework. Research the payer you will deal with and find out what special concerns they might have. If, for example, if they are very concerned with keeping hospitalization rates low, then come prepared with any data you have on how your practice handles this.
• Crunch the numbers. Analyze the fee schedule of all your payers and know your break-even point. It’s crucial to know going in at what point you will have to walk away from the table.
• Show your value. Be sure the payer is aware of any quality initiatives you take part in or if you are accredited by a clinical quality organization. If you have data demonstrating that you provide good quality care at low cost, strut that data. Also if you practice in an area where there are not many other providers of your type or you see a particular demographic of patients (children or the LGBT community, for example) not treated by many other local physicians, be sure to point that out. Also, come armed with positive patient reviews.
• Counter offer. If you can’t get concessions on pay rates, you may still be able to get some other things of value. For example, ask for better terms on the window for resubmitting claims or for ways to streamline the prior authorization process.
If you come away from the table empty handed, you’ll have to decide it it’s financially feasible to stay with that payer. If not, but you don’t want to lose the patients you already have, “you can stay in the network, but stop accepting new patients with that insurance,” says Cantrell.
Be prepared and ask for what you need. You may be surprised at the results.