Negotiate Your Way to Higher Reimbursements

Cindy C. Parman, CPC, CPC-H, RCC
Principal, CSI Coding Strategies, Inc

With preparation, you can negotiate favorable reimbursement from man aged care and other contracted payers. To do so, you will need to develop a contracting strategy be fore each negotiation.

1. It is a negotiation; leave the adversarial relationship at the door. Negotiation is defined as a giveand- take process between parties, each with its aims and needs, seeking to discover a common ground and reach an agreement. The negotiation process should be fair to all parties.

2. Prepare for negotiation. Make a list of contracting issues and include the items you must have, the items you would like to have if possible, and the items you are willing to give up. For the contracting experience to be successful, both parties must leave satisfied with the finalized contract.

3. Be a partner. Demonstrate to the payer how your practice can help it meet its needs with the patient population. Provide information on value-added services offered by your organization, such as clinical trials, disease management, and palliative care. Emphasize relationships with other providers in the same network who ensure their patients get all necessary services in a cost-effective manner. In addition, if you have cutting- edge technology or a desirable location, emphasize those benefits.

4. Compile organized data.Quantify the number of medical necessity denials or bundling rejections from this payer, and what each type of denial has cost your practice or facility. Develop statistics on the number of repeat patients, results of patient satisfaction surveys, aggregate payment amounts, and any other statistical information that supports your case for increased reimbursement. Remember the golden rule of data: He who has the data, rules.

5. Emphasize quality. Analyze and compile utilizations and outcomes data to use for leverage during contract negotiations (eg, cost per patient by diagnosis code). Most managed care payers try to reimburse all their network providers at the same rate schedule, which may be a percentage of the Medicare Physician Fee Schedule or based on America’s Health Insurance Plans data. If you can present data showing that your practice or facility is a lower cost provider with the same or better clinical outcomes than other providers of the same medical specialty on its preferred provider panel, the managed care plan may consider a rate increase.

6. Seek clarity. The negotiation process is the time to ensure that all terms are defined adequately, including the use of bundling software, preauthorization requirements, refunds, penalties, and other contracting issues. Eliminate any ambiguous language or confusing clauses during the negotiation process.

7. Little things. Look for apparently minor contractual issues that may cost your practice money over time; for example, a clause that requires the practice to pay for copying records when the insurance company requests a medical record review.

8. Maintain balance. Try not to negotiate contracts that place all or most of your patients with 1 or 2 managed care plans. You will need to protect your practice against a major dispute or failure of one plan costing the practice most of its revenue.

9. Have an “out.” One of the best contracting tools is a termination clause. For example, negotiate a 90- day contract termination option, so that if the practice starts losing a significant amount of money on this segment of the patient population, the contract can be terminated in a reasonable time frame.

10. Be oncology-specific. Although negotiations should never focus exclusively on payments, make certain to review specific issues related to oncology services, such as the payer’s formulary, off-label drug use requirements, payments for drug waste, medical necessity, and the appeals process.

11. It is a relationship. After nego - tiations, be the best contract partner possible. Monitor publications from the managed care plan, communicate with your provider relations representative, and stay abreast of any changes.



Cindy Parman is Principal, CSI Coding Strategies, Inc, which provides auditing, education, and reference tools for outpatient coding and other consulting services for specialty coding and compliance.

Related Articles

Subscribe to
Oncology Practice Management

Stay up to date with oncology news & updates by subscribing to recieve the free OPM print publications or weekly e‑Newsletter.

I'd like to recieve: