Negotiating With Payers

January 1, 2009

I’d love to negotiate with payers, but what would be their motivation to listen to me? Can you give me any pointers in approaching payers when negotiating fee schedules?

Question: I’d love to negotiate with payers, but what would be their motivation to listen to me? Can you give me any pointers in approaching payers when negotiating fee schedules?

Answer: You should try to negotiate even if you have nothing to go on because otherwise you’ll just keep getting bad reimbursement. You also should be regularly assessing your payer relationships to decide whether to continue with them, even if you don’t negotiate. But, what have you got to offer?

It might be:

  • Geography. Who else contracts with this payer and is there a geographic boundary that makes you the only realistic provider for many of your patients?

  • Preferred status. Example: A pediatrician realized that many of his patients’ parents worked for the city school district. If he dropped out of network, the school district would hear from one of its major payers.

  • Your patients. They can lobby on your behalf with payers or employers, too.

  • Quality. Can you prove that you offer better or more cost effective service?

You also can negotiate rates for just a few, key services or focus instead on clauses about timely filing, refund limits, and the like.