Many providers simply sign a contract and then fail to revisit them for years. This “file and forget” approach has profound consequences on payer revenue. Having a process in place to regularly review all the contracts and fee schedules in an organization’s portfolio is a must.
Provider organizations can overcome these challenges and maximize their revenue by understanding the basics of payer contracts, creating a central space for contracts with fee schedules and preparing for negotiations.
- Managing contracts and fee schedules provides a systematic way of avoiding contracts to go unchanged for several years.
- Know the anniversary date of your contracts and how much notice you must give to make changes.
- Analyze the contract fee schedule and determine whether changes are needed.
- Monitor and analyze your payer mix year to year.
- Set a negotiating range that includes an optimum, minimum, and desired goal. Optimum is the starting point, the terms you consider ideal. Minimum is the point that must be met for you to sign. Desired is the point you would like to end up after negotiation.
- Developing data-driven responses to potential questions or pushbacks puts providers in an ideal place to negotiate.
SUMMARY
Analytics allows providers to understand the true value of their payer contracts. Physicians need the ability to visualize their existing contracts/fee schedules and how commercial payers stack up against each other.