// GETTING IT RIGHT
LAW MIND: IT’S NOT ALL ABOUT THAT RATE
APPROACH NEGOTIATIONS with PAYERS How to
PHYSICIANS MUST IMPLEMENT A LONG-TERM, STRATEGIC APPROACH TO NEGOTIATING CONTRACTS WITH PAYERS. Gone are the days of trying to get a
few dollars more per CPT code or a few numbers higher as a percentage of Medicare. Today, it’s about more than the rate. Successful physician groups are building strategic alignment with payers to provide quality care for reasonable prices.
Ann M. Bittinger, JD, represents physicians and physician groups in transactions with other entities and with compliance with federal health care laws and in structuring their independent practices. Questions? Email ann@bittingerlaw.com
24 | GI.ORG/ACGMAGAZINE
Analyze Your Group As in any successful negotiation, first you need to know what you bring to the table. I’m surprised how many clients can’t tell me how much their top three payers pay them for a colonoscopy, or how much those payers are supposed to pay them per their contract. Often those two numbers are not the same. First, get your house in order. Understand what the contracts say versus what the payers are paying you. If you’ve been underpaid for a while, that lemon can be turned into lemonade by using that fact as justification that the insurer should pay you more going forward. How long does it take payers to pay claims? Which payers dispute claims or haggle about medical necessity, pre-authorizations and the like? A good practice chief executive officer will interview billing staff to learn the nuances of each payer before going to the negotiating table with the payer. This is important because often payers will not give an across-theboard increase but will carve out a few CPT codes and grant an increase on those, while leaving others the same or lowering them. Also, what’s your payer mix? What is your private pay versus Medicare percentages of patients? Within the private payers, what payers represent what percentages? Within government payers, what percent are Medicare versus a Medicare managed care plan? When you analyze this information, you will see trends. Once you lay the contracted charges and payments analysis on top of the payer mix percentages, you will identify which payer will give you the most bang for your buck, so to speak, to target for negotiations. This process can take anywhere from one to six months. In addition, analyze procedures versus E&M coding for office visits versus diagnostics (and another subset of services you may provide). Would you be willing to sacrifice a lower rate for imaging, for example, to get a higher rate on procedures? Would the net outcome be an increase?
