Unsurprisingly, more healthcare providers and payers are negotiating SNF managed care contracts, with the medical industry focusing on population health and the need to stabilize rising prices. According to the Healthcare Financial Management Association, when these managed care contracts are efficiently negotiated, a higher revenue stream on the payer side may result from new insurance products.
Managed care contracts are agreements that set the terms and circumstances for delivering and reimbursing health services between healthcare providers and payers. Negotiating these contracts can be difficult, especially in a fast-paced and competitive market. However, you may improve your organization’s and patients’ outcomes with the right strategies. Here are some tips to help you prepare for and carry out successful managed care contract negotiations.
Tip #1: Build Trust & Rapport
Though negotiating a managed care contract (MCC) is a financial transaction, it is also an opportunity to create rapport and confidence with the payer. To accomplish this, you must always be courteous, respectful, and professional. Furthermore, it is critical to actively and emphatically listen to the payer’s concerns and interests, clarify any ambiguities or misunderstandings, ask open-ended questions, share relevant information and data that supports your position, and offer creative solutions that address both parties’ needs and goals.
Tip #2: Don’t Limit Your Focus to Rates
As MCCs govern various provider operations, healthcare facilities mustn’t limit their scope to only rates. When negotiating with a payor, extracting the most money for each service can constantly be enticing, but there are other factors to consider.
• How does the relationship impact day-to-day operations?
• How do reimbursement schedules work?
• What is the payor’s (MCO’s) reputation for responding to inquiries and processing payments?
• Is the payor’s credentialing criterion precise, putting the provider at a disadvantage?
• How diverse is the contract’s requested service offering?
In fact, healthcare providers can extract more value from the process, even if the rate is lower, by broadening the contract negotiating process to incorporate other factors. The secret here is to negotiate each aspect of the contract rather than focusing solely on rates—the MCO will do this, so the provider should also. In these circumstances, the whole intrinsic worth of the contract must be considered, as well as additional criteria relating to service and the payor’s reputation.
Tip #3: Develop A Negotiation Plan
After gathering pertinent information, you must create a negotiation plan that defines your strategies, objectives, tactics, and alternatives. A list of the contract terms and provisions that you intend to negotiate, such as incentives, rates, dispute resolution, quality measures, and termination clauses, should be included in your strategy. You should also establish a range of acceptable outcomes for each term, from your ideal scenario to your walk-away point, with evidence and rationale for each outcome based on your value proposition, market research, and payer analysis.
Furthermore, each term should include a contingency strategy in case the negotiations approach an impasse or a deadlock. Finally, you should create a negotiating timeline and team with defined roles and duties.
Tip #4: Create a Profile for Each MCC
One of the most essential elements of contract management approaches is preparation. Providers should establish an MCO profile for each negotiation process before initiating talks or renegotiations with a specific MCO. The goal of these profiles is to establish what the MCO expects from the negotiating process in order to anticipate potential disadvantages for the provider.
• Determine the products and services the payor intends to support during the negotiation phase.
• Conduct a historical investigation into how you interact with the payor, including revenue levels, inpatient vs. outpatient treatment, and the various services provided.
• Try to identify any flaws in the historical investigation and establish what needs to be improved.
• Seek feedback from your personnel on dealing with the payor and recommendations on how to improve the relationship.
• Combine all this information to create one cohesive profile for the MCO.
The end result of this approach will be a negotiating strategy that will improve the contract and, as a result, revenue levels for providers.
Tip #5: Partner with 24/7 Medical Billing Services
As healthcare providers are at a competitive disadvantage when it comes to negotiating managed care contracts due to the size and scope of their MCO competitors, they must think outside the box. A strategic alliance can provide them an advantage in the process of negotiation.
24/7 Medical Billing Services comes into the picture here.
24/7 Medical Billing Services provides providers the tools they need to negotiate beneficial contracts. We discover the greatest contract opportunities that match the individual needs of every provider with whom we collaborate, regardless of size. Our extensive network and MCO ties will secure you the best contracts and a steady flow of patients.
Furthermore, we may execute all necessary duties to obtain the best possible offer, such as:
• Creating payor profiles in preparation for negotiations
• Identifying the major leverage points of the provider
• Creating the best possible compromise options (if necessary)
Working with 24/7 Medical Billing Services relieves you of the burden of negotiating SNF managed care contracts with payors. Reach out to us right away if you want to make the most of your contracts while receiving the greatest reimbursement rates possible.
About 24/7 Medical Billing Services:
24/7 Medical Billing Services is the nation’s leading medical billing service provider catering services to more than 43 specialties across the entire 50 states. You can rely on us for end-to-end revenue cycle management. We guarantee up to 10-20% increase in the revenue with cost reduction of your practice for up to 50%.
Call us today at 888-502-0537 to know more on how we can help boost profitability for your practice.
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