[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/medwave.io\/2022\/11\/payer-contracting-what-healthcare-providers-should-understand\/#BlogPosting","mainEntityOfPage":"https:\/\/medwave.io\/2022\/11\/payer-contracting-what-healthcare-providers-should-understand\/","headline":"Payer Contracting, What Healthcare Providers Should Understand","name":"Payer Contracting, What Healthcare Providers Should Understand","description":"Let\u2019s begin with this set-up: Let\u2019s say you\u2019re hunting for a new job and receive a call from a would-be employer informing you that the job is yours. Of course, you\u2019re thrilled by the news and inquire about your starting salary. Your new employer replies that you need to wait for your first paycheck to […]","datePublished":"2022-11-07","dateModified":"2026-03-07","author":{"@type":"Person","@id":"https:\/\/medwave.io\/author\/admin-2\/#Person","name":"admin","url":"https:\/\/medwave.io\/author\/admin-2\/","identifier":2,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/c316763f6818380164c3414fc4575167bcffddaaedbc31902e4e2c7a44540392?s=96&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/c316763f6818380164c3414fc4575167bcffddaaedbc31902e4e2c7a44540392?s=96&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Medwave Billing & Credentialing","logo":{"@type":"ImageObject","@id":"https:\/\/medwave.io\/wp-content\/uploads\/2017\/12\/medwave-pittsburgh-medical-billing-400x400.png","url":"https:\/\/medwave.io\/wp-content\/uploads\/2017\/12\/medwave-pittsburgh-medical-billing-400x400.png","width":200,"height":200}},"image":{"@type":"ImageObject","@id":"https:\/\/medwave.io\/wp-content\/uploads\/2023\/02\/payor-contracting-white-female.jpg","url":"https:\/\/medwave.io\/wp-content\/uploads\/2023\/02\/payor-contracting-white-female.jpg","height":300,"width":620},"url":"https:\/\/medwave.io\/2022\/11\/payer-contracting-what-healthcare-providers-should-understand\/","about":["Articles","Credentialing","Credentialing On-Boarding","Enrollment","Healthcare Credentialing","Healthcare Outcomes","Measuring Healthcare Outcomes","Medicaid","Medical Credentialing","Medicare","Payer Contracting","Private Insurers"],"wordCount":1059,"keywords":["Credentialing","Healthcare Credentialing","Medicaid","Medicare","Private Insurers","Provider Credentialing","Provider Networks","Reimbursement Rates"],"articleBody":"Let\u2019s begin with this set-up: Let\u2019s say you\u2019re hunting for a new job and receive a call from a would-be employer informing you that the job is yours. Of course, you\u2019re thrilled by the news and inquire about your starting salary. Your new employer replies that you need to wait for your first paycheck to find out!You then ask what hours you are required to work, and your employer tells you that they will let you know if you miss your shift. \u00a0And you find that this is only the beginning of your new employer woes!Yep, this sounds a bit insane, and an employer would never intimidate an employee, especially a new one, this way. But it still begs the question, why would you put up with this type of relationship with your insurance payers? In many healthcare practices, payers account for up to 80 percent of the provider\u2019s revenue, but many providers still don\u2019t even know what\u2019s in their contracts.Keep this in mind: Knowing your contracts can enable you to collect even more revenue and better protect you practice.What are Payer Contracts, Precisely?Payer contracts describe and make clear a provider’s reimbursement contract for providing healthcare services within an assortment of plans. Payer contracts include such items as reimbursement rates, provider networks and provider credentialing, all of which have an effect on negotiating rates, benefits, and more.The main reason you may not have a copy of this contract with a payer or know what it contains is because getting a hold of a payer contract can be rather problematic. Yes, it\u2019s your contract, with your signature, but it can take a huge amount of time to acquire, even after you\u2019ve asked for it. Plus, once asked for, it can take an exhaustive follow-up on your part (phone calls, emails, faxes or direct outreach) to ultimately obtain a copy of the contract.So, What Can You Do to Speed Up This Process?Establish a game plan. First, identify the scope and your goals. For example, you might only want to collect contracts or you may want to collect contracts as well as do some negotiating. No matter the reason, make sure you\u2019ve identified it upfront. Next, summarize the best channels for communication. Some companies prefer phone calls, others might like faxes while others still desire emails. Last, set up tracking and monitoring to keep yourself and payers accountable.Prioritize and target your payers. Before you spend time making an attempt to contact payers, you should pick out your top 5-10 payers.Single out the best rep in your area. After identifying your top payers, it\u2019s time to link up with the person at that payer company related to your contract. The challenge: while some payers are pretty good at disclosing contacts, it might demand some creativity on your part to contact the correct person at other payers.Be thorough. Always keep in mind that you have a right to your provider agreement, and that these are legally binding contracts and that you require the information in your contract to assure contract fulfillment. Don\u2019t ever give up!What to Do, After You\u2019ve Received a Copy of Your Payer Contract?Okay, you\u2019ve made contact and got hold of a copy of your contract. Now, how can you go about negotiating a more favorable payer contract? Let\u2019s see what Andrew Harding, co-founder at Rivet, a healthcare billing\u00a0and payment company, has to say.Distinguish yourself. Let\u2019s say you\u2019re inquiring about a payment rate increase. You need to demonstrate to the payer what value you offer judged against your local peers. For example, are you the only practice that offers extended hours or telehealth appointments on weekends? Are you the only PCP in a 5-mile radius? A physician may dominant a market within a few-mile radius and not even know it.Pinpoint your volume of active patients. This is the number of unique patients you\u2019ve seen in the past two years. Remind the payer that if you go out of network, the payer will have to inform patients that their designated primary care physician is no longer in network, which more than likely will upset patients when informed they have to switch physicians.Take into consideration an escalator clause. This is a contract stipulation that assures a precise payment increase during a definite period. For example, providers might negotiate a three-year contract but add in routine increases of one percent per year.Implement a payer analysis. How does one payer\u2019s payment rates stand up to others? Is that payer paying below-market rates? If so, use de-identified information to build a case for higher rates. Talk with other physicians in your region to get a sense of their contracted rates, says Boyd Stewart, vice president of KLAS Enterprises, a payer-provider company.Negotiate carve-outs for high-utilization services. For example, your practice might be able to negotiate higher rates explicitly for office visits to boost revenue.Summary: What Providers Should Know About Payer ContractingThe aforementioned content highlights a critical disconnect in healthcare. While insurance payers represent up to 80% of many providers’ revenue, most healthcare providers don’t actually know what’s in their payer contracts. The article uses an analogy of accepting a job without knowing your salary or work schedule to illustrate how problematic this situation is.Getting Your ContractsA four-step process:Establish a clear game plan with defined goals and preferred communication methodsPrioritize your top 5-10 payers by revenue impactIdentify the right contact person at each payer organizationBe persistent, remembering you have a legal right to your own contractsNegotiating Better TermsOnce you have your contracts, the article offers several negotiation strategies from industry experts:Demonstrate your unique value proposition compared to local competitorsLeverage your patient volume as negotiating powerConsider escalator clauses for automatic annual increasesConduct payer analysis to identify below-market ratesNegotiate higher rates for specific high-utilization servicesThe key takeaway is that knowing and actively managing your payer contracts can significantly increase revenue and better protect your practice. At Medwave, we are a resource for providers who need professional assistance with payer contracting services.Need more help? Contact our professionals to find our more about our payer contracting services."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"2022","item":"https:\/\/medwave.io\/2022\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"11","item":"https:\/\/medwave.io\/2022\/\/11\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"Payer Contracting, What Healthcare Providers Should Understand","item":"https:\/\/medwave.io\/2022\/11\/payer-contracting-what-healthcare-providers-should-understand\/#breadcrumbitem"}]}]