Practice Management Alert

You know you should be reviewing your payer contracts every year, and there are likely some contracts you want to renegotiate, payers you would like to begin participating with, or contracts you would like to terminate. If figuring out where to begin leads to anxiety attacks, stop stressing. Just follow these expert tips to ensure you get the most out of every contract your practice signs.

Where to start the process depends on the payer you-re dealing with. Insurance companies have different people within the organization who can handle contract renegotiation or new contract writing.

"You should contact the insurance company/network to find out who you should renegotiate with. They will give you contact info," says Anne Garrity, medical collector for Alpine Family Physicians in Lake Zurich, Ill.

Tip: If you-re not sure whom to start with, try contacting your provider rep first. "With some carriers the provider rep does have some authority to agree to a higher fee, but they are still limited," says Jonathan Devlin, owner of Practice Services in Dalton, Ga. "If you are on good terms with your provider reps, it is helpful."

Spend time negotiating with the payer to ensure you get the best possible contract for your individual practice. Avoid boilerplate text and cookie-cutter contract models. Standard contracts don't work for all practices. The contract needs to apply specifically to your practice and include information such as your fee schedule, handling of modifiers, multiple surgery discount rates, how long the payer can go back to request refunds, what is considered timely filing, requirements for arbitration, how outstanding claims get paid, and appeal processes.

For example: If you contract with a payer who shows you what appears to be a good fee schedule for the few codes shown, but you end up with poor reimbursement because the balance of the codes do not pay well, they don't honor the definition of modifiers, and they seem to "lose" claims all of the time, you-ll only end up with hassles. Obtain a specialty-specific fee schedule from the payer whenever possible along with the other terms, because a contract is a great deal more than the fees. Most contracts include a generic fee schedule, but this may not provide information on the codes you most frequently bill.

Tip: See if you can get the new insurer to outdo your best payer. "Before talking money with them, figure out who is your highest-paying insurance company and try to get that fee schedule plus, out of the insurance company you are renegotiating with," Garrity suggests.

Remember: When looking at the contract language, you should also review the length of the contract and what happens when the contract expires. Your contract should specify when the contract is up and whether there are automatic extensions, as well as renewal options and processes.

"Make sure the contract, if valid for longer than one year, has an escalating clause included," Garrity cautions.

When you are working out a new contract or revising an old one, make sure that you review every sentence. Make sure you read each word and don't skip over "standard" wording. Watch for things that need to be added or taken out, such as fee schedule information and arbitration clauses.

"Most of the network reps are very nice, but they are out to save the insurance company money, so it pays to read over any agreement you come into with them before signing," Garrity warns. "Make sure your terms are in the agreement."

Additionally: Take the careful review one step further. "I would also recommend that if an insurer is willing to negotiate, the practice hire a consultant or attorney that specializes in this type of negotiation," Devlin says.

Refunds: While it seems that the refund period should be equal to the timely filing period, this is a hard point to negotiate, says Barbara J. Cobuzzi, MBA, CPC-OTO, CPC-H, CPC-P, CPC-I, CHCC, president of CRN Healthcare Solutions, a coding and reimbursement consulting firm in Tinton Falls, N.J., and senior coder and auditor for The Coding Network. "Many states have limits on the time a payer can go back to ask for a refund. Try to get the refund period as short as possible and try to limit the payers- ability to take offsets for the refund, allowing you time to research these requests, appeal them, and if appropriate, write them a check," she adds.

Good practice: Put a time limit on your negotiations with the payer. While you should negotiate points in your contract, if you and the carrier are at odds, going back and forth for months won't be productive for either side. Set up a timeline for completing the negotiations. Keep in mind that it is not the end of the world if negotiations fail and you don't sign a contract. You-re better off not signing than signing a bad contract.