Although negotiating health insurance contracts may seem difficult and never-ending, it is not as difficult as you may expect. While it is crucial for practices to ensure fair reimbursements from health insurance payers and for the sustainability of the practice—it is also imperative for healthcare practices to scrutinize the process with complete delicacy yet clarity.
Insurance contract negotiation, when done the right way can yield the best possible profitability for practices. Now, how do you do this? Read below for 11 key points that practices should keep in mind while negotiating insurance contracts:
- Gather relevant data.
Information is power. Accumulate precise practice data through meticulous analysis, study, and strategic plans before going into your negotiations with potential insurance companies in order to attain fair negotiations. Make sure that all the necessary touch points have been covered that indicate the practice quality, efficiency in patient care, new encounters, drug prescriptions, specialization, patient engagement, satisfaction, and referrals before introducing it to the community. Leverage the gained data while negotiating the terms of the contract to ensure uplifted practice reputation and efficacy of service delivery.
- Analyze contracts and covered services.
Ensure clear transparency across insurance contracts by analyzing terms and conditions, renewal speeds, expiration, requests, adjustments, terms modifications, and more. These aspects are crucial for proper and timely reimbursements. How do you ensure everything is intact? Hire an in-house administrator to review the details before finalizing your negotiations to help handle these contract analyses.
Make sure that the services rendered by the practice are covered in the insurance contract. Also, look into potential differences that could occur during the service delivery and make sure that those are included in the coverage.
- Attain clarity in the value and market share.
Know what differentiates the practice from the competitors, that is, the unique offering that is sold to the patients, and what makes the practice stand out in terms of business prospects. Not just that, it is also important to communicate these values to the insurance payers to ensure a potential contractual agreement that satisfies the profitability of the practice.
For instance, quality care and patient engagement are two important aspects of healthcare practices in which competitive values impose themselves. So to ensure effective insurance coverage, practices must make sure that they effectively communicate their expertise in those aspects.
Communicating them effectively to the payers not only ensures coverage but also maintains ongoing relationships with them which could ultimately benefit the longevity of the practice.
Another aspect to communicate to the payer is the practice’s relevant market data that indicates the performance and patient satisfaction, obtained from patients’ positive reviews and KPIs. Sharing this information can only strengthen the potentiality of the contracts during negotiation.
- Effectively negotiate contract terms.
Implement the best negotiation strategies that could help boost patient satisfaction and enhance practice revenue. Introduce the value proposition with absolute clarity and allow them to understand what benefits they gain out of this contractual agreement. Communicate positive touch points, and patient success stories, and educate them on the kind of specialty/specialties that the practice focuses on.
At the end of the day, communication is the key while negotiating. Allow them to experience the conversation as an opportunity for investment rather than an expenditure. Let them know that their values are taken into account while listing out the terms.
- Be consistent.
Negotiation is an art. It takes a lot of patience and there will be times that the payer might not revert to your proposition. Be vigilant to this prior and plan the strategy accordingly. Even after proper planning, it might look as if the practice’s concerns might not be accepted straight forward.
Consistency is the only key to dealing with such situations. Be consistent in pushing your needs and values before them and they may eventually recognize your side.
- Allocate notifications.
Communicate clearly with the insurance provider to notify the practice of newer updates on fee schedules, coverage, time of filing, and other requirements which require proper attention to avoid payment denials. Make sure that the contractual agreement contains the signature of both the provider and payer.
- Manage disagreements.
In case of any dispute arousal between the two parties, there must be a proper contractual clause that denotes the way the arbitration has to be conducted. Ensure that the language of indemnity implies equal and mutual responsibilities, which may result in unreliable plans.
- Properly handle claims management.
Properly review the contract to bring in clarity on the claims management, time taken to process a clean-claim payment, the steps taken to process the claims, and such. Ensure the clear mention of factors such as claims submission period, time taken for denial claim appeal, overdue interest rate, cancellation, and time taken for the payment of coverage in the contract.
- Properly handle medical records.
Properly assess the contract clause that states the medical records of the patients to claim insurance coverage. Ensure that only a minimum number of medical records requires submission and note the complete record to save a lot of time and cost.
- Re-negotiate—if needed.
In any case of a contract dropping due to expiration or any other reason for a matter like low insurance coverage, practices must be ready to re-negotiate with the insurance payer. Re-negotiation also serves as the first negotiation, putting forth your ideologies, goals, and existing motivations to reason on the practice’s behalf. This step is necessary if the practice or physician is facing a financial strain due to the reduced revenue obtained from insurance companies.
- Scale up the team.
Negotiating is not just for the merit of receiving a contract for a period but for long-term cooperation with the insurance payers to attain favorable contract terms and plans. Negotiation is also the very first and most difficult step to achieve.
If practices find it hard to do this part, they must consider scaling up their team by partnering with potential personnel to help them identify the strengths, values, and leverage insightful data, and navigate through the contract negotiation process easily.