CONTRACT NEGOTIATION: Improve your Practice’s...
Transcript of CONTRACT NEGOTIATION: Improve your Practice’s...
CONTRACT NEGOTIATION:
Improve your Practice’s Revenue
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Marcia Brauchler, MPH CPC, CPC-H, CPC-I, CPHQ
Monday, April 15, 2013
10:30 am to 12:00 pm
All Rights Reserved.
Objectives
• Get organized for successful payer
contracting negotiations.
• Describe the predictable steps in any
negotiation.
• Employ strategies to monitor your success
once the contract is in effect.
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Look
familiar?
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AGENDA
• Why bother?
• How to Get Started
• Gather data
• Prepare, prepare, prepare
• Begin with the End in Mind
• Negotiation strategies
• Monitor for continued success
• Questions?
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WHY
BOTHER?
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It’s your practice’s paycheck
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You probably have more leverage than you think
Practices do succeed – if it is given priority:
April 6th: Contract improvement requested with payor
23 different contacts over 4+ months
August 15th: +7% increase (year 1) plus +5% increase (year 2)
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NOTE:
Mandated fee schedules are not negotiable
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The market place is getting smaller – payor consolidation
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Colorado Payors circa 2000 • Aetna • Affordable • Alliance • Anthem BCBS • Antero Health Plan • Beech Street • Colorado Access • Community Care Network
(CCN) • Community Health Plan of the
Rockies (CHPR) • CorVel • Concentra • CIGNA Health Care • CompreCare • Coventry Health Care • First Choice of the Midwest • First Health • GEHA/PPO USA Network
• FOCUS • Great-West • Humana, Inc. • Kaiser • MedRisk • MetLife • Mountain Medical Affiliates
(MMA) • Mutual of Omaha • MultiPlan (Viant) • One Health Plan • PacifiCare • Private Healthcare Systems • Prudential • Rocky Mountain Health Plans • Sloans Lake • Take Care • Western Health Plan • United Healthcare
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Colorado Payors Today • Aetna • Affordable • Alliance • Anthem BCBS • Antero Health Plan • Beech Street • Colorado Access • Community Care Network
(CCN) • Community Health Plan of the
Rockies (CHPR) • CorVel • Concentra • CIGNA Health Care • CompreCare • Coventry Health Care • First Choice of the Midwest • First Health • GEHA/PPO USA Network
• FOCUS • Great-West • Humana, Inc. • Kaiser • MedRisk • MetLife • Mountain Medical Affiliates
(MMA) • Mutual of Omaha • MultiPlan (Viant) • One Health Plan • PacifiCare • Private Healthcare Systems • Prudential • Rocky Mountain Health Plans • Sloans Lake • Take Care • Western Health Plan • United Healthcare
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HOW TO GET
STARTED
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RESOURCES for gathering Payor Data
for Your State:
• HMO: your state’s Department of Insurance
• PPO: proprietary, broker or employer advocacy group
• Medicare Advantage: Medicare beneficiary website
• IPAs/PHOs: hospital websites, under “Payors we Accept”
• Workers’ Compensation Carriers: Department of
Workers’ Compensation
• Auto/Lien Payors: claims adjustor for large insurers, like
State Farm; lawyers with non-insured cases
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Example of
Payors in
Dade County,
Florida:
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http://www.floir.com/siteDocuments/H
MO1Q2012.pdf
Time commitment to renegotiate a
typical practice’s agreements
• 100 hours
over
• 6 months
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Objectives
• Get organized for successful payer
contracting negotiations.
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GATHER
DATA
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Define your Practice
Productivity by CPT/HCPCS
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ICD-9 Frequency
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Define your Practice
Define your Practice Fee Schedule
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Define your Payer Experience
Insurance accounts receivable (A/R) aging
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Define your Payer Experience
Clearinghouse reports
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Define your Payer Experience
• Contract allowable exception report
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Srvc
Date
Post
Date Code Description Charges
Expected
Payment
Actual
Payment
8/9/12 8/28/12 99214
Office/OP
Visit, Est.
Patient $197.66 $111.86 $61.50
Define your Payer Experience Denials reports
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Denial Reason Totals
Diagnosis code incorrect 0 0.00% $-
Ins Req Info From Patient/Clinic 18 5.34% $1,645.50
No Prior Auth/Referral 2 0.59% $48.00
Duplicate claim/service 0 0.00% $-
Procedure code incorrect 0 0.00% $-
Timely limit for filing has expired 0 0.00% $-
Can't ID/ Incorrect ID 1 0.30% $21.00
Procedure Incidental/Bundled to another 226 67.06% $6,087.00
No coverage 56 16.62% $2,842.50
Patient has another insurance 0 0.00% $-
Deductible 0 0.00% $-
Lifetime benefit max has been reached 0 0.00% $-
Co-insurance 0 0.00% $-
Co-payment 0 0.00% $-
Pre-Existing Condition 1 0.30% $21.00
Service not covered/ Not a benefit 33 9.79% $1,395.00
Total Denial Errors: 337 $12,060.00
Voucher Count/Denial Benchmark: 14795 2.28%
Define your Payer Experience
• Payer mix . . .
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Payor Mix (Example):
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Real-life
Payer Mix
Payor Percent of Business
Auto 1.5%
Charity 0.9%
Comm 6%
Contract 51%
MCD 7%
MCR 16%
MGD MCR 4%
SP 9%
SSA 4%
Tricare 0.2%
WC 0.2%
Total 99.8% 28
“20% Rule”
• No more than 20% of your total practice managed care revenue should come from a single payor
– Ideal, but usually not reality
• Diversification is protection
– Have an open mind when it comes to new players
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Define your Product Mix
•HMO
•PPO
•Medicare
•Workers
Comp
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Gather your own Patients’
Plan Data
• How?
– Practice Management system
– EOB review
– Front Desk “survey” 31
Get Payor Online Access
• Find the payor(s) provider sites.
• For example, Aetna, CIGNA and United Health Care:
http://navinet.navime
dix.com/Main.asp
• Why?
32 2ndLt Joshua Larson, USMC, www.defense.gov
Ancillary Provider Map of
Insurance Plan to Ancillary
Networks
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OptumHealth
Health New England
United Healthcare
Healthways
Aetna
Humana
Kaiser
Principal
Sterling
American Specialty Health
CIGNA
Fallon Community
TUFTS
UniCare
Determine how your Participation
Agreements are held
–For each physician
–Individually, Group, IPA
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Determine Contracted
Reimbursement Terms
– By product line (HMO, PPO, Medicare Advantage)
– % of RBRVS, Conversion Factors,
Discount off Billed
Here’s how . . .
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Reimbursement terms:
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• Determine if reimbursement is fixed on a given year
of RBRVS
• Consider what components of RBRVS does the
payor utilize
– Geographic adjustment, site of service differential, etc.
• A thought about “Term”
Disregard payors who say
you can’t negotiate now
• “Term” Section
• Negotiation window . . . Ugh.
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High-Level Summary:
Gather base year fee schedules
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PREPARE, PREPARE,
PREPARE
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“Payer Resource Manual”
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Client Practice Example
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Pull past utilization by Payer
History is the best predictor of the future
– Example…
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Example of Past Utilization:
CPT Procedure Count Allowed 2011 RBRVS
77334-26 Treatment Device 615 $97.20 $63.14
77300-26 Basic Dosimetry 494 $49.12 $31.85
77427 Weekly Treatment Mgmt 485 $199.18 $182.51
99213 Office Visit 390 $39.66 $49.80
77280-26 Simulation 102 $55.84 $35.71
77263 Treatment Planning 89 $247.64 $163.03
77290-26 Simulation 82 $124.08 $79.69
99205 Office Visit 72 $136.30 $163.52
77315-26 Isodose Plan 52 $124.08 $79.69
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Establish reference point using
Utilization data. . . .
Analyze utilization data in conjunction with current RBRVS
– Example of impact of Utilization data …
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Pure Average:
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CPT Procedure Allowed Proposed Change
77334-26 Treatment Device $97.20 $66.35 68%
77300-26 Basic Dosimetry $49.12 $33.36 68%
77427 Weekly Treatment Mgmt $199.18 $206.69 104%
99213 Office Visit $39.66 $51.39 130%
77280-26 Simulation $55.84 $37.59 67%
77263 Treatment Planning $247.64 $172.57 70%
77290-26 Simulation $124.08 $83.60 67%
99205 Office Visit $136.30 $169.11 124%
77315-26 Isodose Plan $124.08 $83.60 67%
85%
Weighted Average:
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CPT Procedure Count Proposed Wtd Impact
77334-26 Treatment Device 615 $66.35 16%
77300-26 Basic Dosimetry 494 $33.36 13%
77427 Weekly Treatment Mgmt 485 $206.69 19%
99213 Office Visit 390 $51.39 19%
77280-26 Simulation 102 $37.59 3%
77263 Treatment Planning 89 $172.57 2%
77290-26 Simulation 82 $83.60 2%
99205 Office Visit 72 $169.11 3%
77315-26 Isodose Plan 52 $83.60 1%
2381 78%
Establish a reference point
• Determine financial outcome
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Current 1st
Payor
Offer
2nd
Payor
Offer
3rd
Payor
Offer
FINAL
Actual Dollars (using 2010 Utilization)
E&M Codes $41,586 $50,848 $53,292 $55,738 $58,181
Procedure Codes $246,794 $204,461 $209,966 $224,571 $234,384
Total $288,380 $255,309 $263,258 $280,309 $292,565
Impact to Practice N/A ($33,071) ($25,122) ($8,071) $4,185
Objectives
• Describe the predictable steps in any
negotiation.
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BEGIN WITH
THE END IN
MIND
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Now what?
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0% Identify Payor Contact
10% Draft & Send Health Plan
Proposal
20% Follow-up with Payor
30% Receive Offer from Payor
40% Read Language & Draft
Revisions
50% Language & Rates Acceptable
60% Signature on Contract
70% Credentialing
Packet Submitted
80% Contract Returned Correctly
90% Credentialing
Approved
100% Effective Date
Police Reimbursement
for Accuracy
Contracting – 0% Completion
0% Identify Payor Contact
• Identify payor contact information.
• Identify specific person in-charge of contracting, with responsibility for an entire network.
• Once contact person is identified and recorded, you’re ready to start the negotiation process.
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Alphabetical Payer Contact List
Insurance Company
Name
Contact
Name
Title Phone &
Fax
E-mail Address
Alpha HMO
Beta PPO
Delta Workers Comp
Gamma Plan
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HANDOUT “Alpha Payer Contact List”
Contracting – 10% Completion
10% Draft & send
Health Plan Proposal
• Send in a written request.
• Define your practice and needs to Payor.
• State your reimbursement needs.
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Contracting – 20% Completion
20% Follow-up with Payor
•Acquire verbal commitment.
•If no verbal agreement, ensure payor understanding.
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Contracting – 30% Completion
30% Receive offer from Payor
• Represent Practice’s unique circumstances.
• Codes.
• Ensure circumstances are represented in calculating acceptable rates.
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Contracting – 40% Completion
40% Read Language & Draft Revisions
•Review language and fee schedule terms.
•Know the deal-breakers.
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NEGOTIATION
STRATEGIES
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Contract Negotiation
Skim the Contract
•Skim – locate relevant data
•Focus on what matters the most
•Don’t get lost in the verbiage
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Key Terms
• Rates
• Timely Filing Limit
• Termination
• Renewal
• Amendment
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Contract Negotiation
Read the Contract in Detail
•Comprehend the contract
•Refer to checklist (health plan proposal letter)
•Make no assumptions
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Contract Negotiation
Prioritize Your Needs (Changes) & Prepare for Negotiation
•Prioritize
•Prepare
•Negotiation 62
Dress Rehearsal
• Who will be present from your side, from their side?
• Where will the negotiations be held?
• Who will say what and when?
• How much time will be allocated?
• Who will produce an agenda?
• Who will summarize the actions and potential tasks?
• Who will document the meeting?
• Agree to not agree.
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Contract Negotiation
Contract Negotiation
Ask for Everything!
•Agenda
•Prepared prioritization list
•Timing
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Negotiation Strategies
• Introductions include: – name, title, function
• Distribute agenda
• Establish parameters for negotiation
• Present what you bring to the table
• Present your data
• Ask for what you want
• Be willing to listen and hear what they are saying
• Be open to explore all options
• Document interaction, task, assign dates and who is responsible
• Summarize
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“Taking initiative does not mean
being pushy, obnoxious, or aggressive.
It does mean recognizing our
responsibility to make things happen.”
Stephen R. Covey
Contract Negotiation
Endure the Negotiation Process
•Stakeholders apprised
•Commit everything to writing
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Now what?
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0% Identify Payor Contact
10% Draft & Send Health Plan
Proposal
20% Follow-up with Payor
30% Receive Offer from Payor
40% Read Language & Draft
Revisions
50% Language & Rates Acceptable
60% Signature on Contract
70% Credentialing Packet Submitted
80% Contract Returned Correctly
90% Credentialing Approved
100% Effective Date
Police Reimbursement
for Accuracy
Contracting – 50% Completion
50% Language & Rates Acceptable
•Ensure language is acceptable.
•Practice agrees acceptable.
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Contracting – 60% Completion
60% Signature on Contract
•Print agreement
•Assemble
• Get signatures
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Contracting – 70% Completion
70% Credentialing Packet Submitted
• Complete packet
• Provide requested documents
• Work with billing person/company
• Set up Online Payor log-ins
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Contracting – 80% Completion
80% Practice Returns Contract Correctly
•Scan document
•Save in easy to find location at Practice
•Return to payor with tracking number
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Contracting – 90% Completion
90% Credentialing Approved
•Be responsive.
•Be proactive.
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Contracting – 100% Completion
100% Effective Date
•Welcome letter to practice
•Get counter-executed agreement for files
•Effective date = ultimate confirmation
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Objectives
• Employ strategies to monitor your success
once the contract is in effect.
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MONITOR
FOR
CONTINUED
SUCCESS 75
Now what?
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0% Identify Payor Contact
10% Draft & Send Health Plan
Proposal
20% Follow-up with Payor
30% Receive Offer from Payor
40% Read Language & Draft
Revisions
50% Language & Rates Acceptable
60% Signature on Contract
70% Credentialing Packet Submitted
80% Contract Returned Correctly
90% Credentialing Approved
100% Effective Date
Police Reimbursement
for Accuracy
Educate Stakeholders
• Get front desk schedulers & pre-auth
coordinator information on Payors
– “Red Light/Green Light”
– Online payor log-ins
• Share effective date and new reimbursement
data with billing staff . . .
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Example for Payor Monitoring:
CPT Code MEDICARE
201X
Alpha
HMO
7/1/2011
Beta
PPO
201X
RBRVS
Delta
Workers
Comp
Gamma
Plan
201X
RBRVS
99201 $35.79 $48.32 $46.53 $62.08 $44.91
99202 $61.85 $83.50 $80.41 $90.73 $79.95
99203 $90.22 $121.80 $117.29 $133.70 $118.69
99204 $137.39 $185.47 $178.60 $191.00 $167.85
99212 $36.94 $49.87 $48.02 $57.30 $46.78
99213 $59.59 $80.44 $77.46 $85.95 $65.21
99214 $89.52 $120.85 $116.38 $128.93 $101.86
99215 $120.88 $163.19 $157.14 $186.23 $147.71
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Mark calendar
Stay proactive
Conscientious monitoring
Renegotiation Schedule
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Go get it!
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Final Words . . .
• Organization on all levels
is essential.
• Follow the steps in the
order outlined for best
results.
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Objectives
• Get organized for the contracting process
and prepare for a successful negotiation.
• List the predictable steps in any
negotiation.
• Identify strategies to monitor success once
the contract is effective.
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QUESTIONS?
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Marcia Brauchler, MPH, CPC, CPC-H, CPC-I, CPHQ
Physicians’ Ally, Inc.
101 W. County Line Rd. #230
Littleton, CO 80129
(303) 586-9390
Fax: (303) 586-9393
Cell: (303) 250-3236