Practice Management Alert

Carriers are making more money than ever, and now’s the time to ask for a raise.

If you have a box or filing cabinet somewhere full of payer contracts that you’d rather not think about, you’re not alone. But you may be missing the opportunity to advocate for better pay for your practice.

“Nobody’s going to give your practice a raise unless you or somebody at your practice asks for a raise,” said Marcia Brauchler, MPH, FACMPE, CPC, COC, CPC-I, CPCQ, in a AAPC HEALTHCON 2022 presentation on negotiating payer contracts.

Be Prepared to Hear ‘No’— But Keep Going

Brauchler described what she called a “pretty typical example” of the effort it took for a practice to succeed in raising their rates with insurance carriers: A practice representative requested a contract improvement with a payer on April 6, made 23 different points of contact over the next four months, and by Aug. 15, successfully negotiated a +7 percent increase for year 1 and a +5 percent increase for year 2.

“You basically have to take no for an answer, or not take no for an answer, 22 times, because in this case, it took 23 times to get to a yes to get to something assignable to acceptable for the practice,” Brauchler said.

Although a rate increase may be the best your practice can hope for, you may not be successful, but, at the very least, going through this process will help you prioritize organization and set you up for other forms of success.

“Even if you’re unable to get a rate increase, which, frankly, should be fairly reasonable — you should expect to get a rate increase. But if you’re unable to get a rate increase, there are still some intangible benefits that make renegotiating your payer contracts or tackling your payer contracts something of value for your time and your position at the practice,” Brauchler said.

She provided some examples for benefits you can aim to capture beyond rate increases alone.

You may have not known the fee schedule for a particular carrier for your practice, but these efforts could lead you to getting that information in black and white, including what your reimbursement should be per procedure code.

You could negotiate to get your contracts to be mutual written amendment only, instead of unilaterally amended by notice of material change. Another possibility is making your contracts have a 90-day without-cause term, instead of longer periods, which would allow you more flexibility in getting out of a contract.

Also look for potential to add in cost-of-living adjustments for contracts instead of agreeing to stick to an evergreen rate. Check in about the geographic pricing available for your practice — and make sure it’s correct — especially if you’re in a state or area with a metropolitan area that may be a lot wealthier than the surrounding rural rates.

Go Whole Hog

Brauchler explained that the bulk of reimbursement for a practice is often earned from maybe four carriers, but, often, one carrier represents the majority of pay. It may seem like a good idea to put most of your effort toward negotiating with that main payer, but focusing all of your effort on one carrier alone or one at a time may not be your best bet.

“It helps to have all four of these things in the queue at the same time because you’re going to have maybe 23 different contacts with each payer, and doing them all, at the same time, you can try to do a little bit every week while waiting for those 23 contacts to occur,” she explained.