Practice Management Alert

Negotiate Your Way to Higher Physician Pay

Question: I am a new practice manager and will be going through my first payer contract negotiation in the next few months. My physician said the last office manager said we are stuck with the reimbursement rates we have with this payer and there is no point in negotiating. I am concerned the payer is not paying my physician enough for his services but we can’t afford to lose the contract. Can I push for fee negotiation?

South Carolina Subscriber

Answer: Yes, you can — and should — negotiate your physician’s reimbursement fee schedule. That doesn’t mean you’ll get what you ask for, but you should try to negotiate.

If you contract with a payer but end up with poor reimbursement rates, you’ll only end up with hassles.

 Key strategies: Obtain a specialty-specific fee schedule from the payer whenever possible. Most contracts will attach a generic fee schedule, but this may not provide the valuable information you need on your most frequently reported codes.

Make sure the fee schedule in your contract is comparable to the fair reimbursement amounts for your specialty codes. If a payer offers you a fee schedule with fees that fall below what you receive from other payers, use your reimbursement grid as a bargaining tool.

Don’t, however, base your decision solely on the fee schedule of your 10 most commonly reported codes the insurance company requests that you give them. Ask for a full fee schedule from the payer.

Clarify: The contract should also be clear about what items you can bill the patient at usual and customary rates — such as noncovered services, denied services, and services found not medically necessary by the payer.

In addition: Negotiate things other than just your fees. Check the payer’s policies on modifier use, multiple surgery adjustments, timely filing time period regulations, recoupment, bundling and arbitration clauses.