3 contract negotiation strategies to improve accounts receivable

If your practice doesn't shrewdly negotiate payer contracts, you're making a big mistake. Many physician owners and practice administrators incorrectly think that health plans won't come to the bargaining table. However, payers are gearing up to compete in the health insurance exchanges that, barring an action by the U.S. Supreme Court, will go live in 2014.

Up to 35 million new members are expected to shop for health insurance coverage via the exchanges, and the payers need strong provider networks.

"These contracts are all negotiable and with more leverage now because payers want to bid in the exchanges. This leverage won't come around again," Maria Todd, president and CEO of Denver-based Mercury Health International, said in an interview with FiercePracticeManagement.

Experts suggest using the following strategies during your next round of contract negotiations:

• Require the insurer to pay within a certain deadline.
  Many state laws require insurers to pay within a certain time, say within 30 or 45 days, but if that prompt payment deadline is not written into the contract, your practice can't enforce it, attorney Robin Fisk in Ashland, N.H., advised.
  
  
• Make sure the contract allows you to collect from members at the time of service.
  Some contracts require providers to wait for the payer's adjudication before collecting the members' cost share, but that can mean waiting weeks or months, and it's much harder to collect from patients then, said Elizabeth Woodcock, founder of consulting firm Woodcock & Associates in Atlanta. Many payers will make this change to their contracts, she said.
  
  
• Negotiate sufficient time--at least 180 days--for filing claims.
  Some payer contracts give physicians a small window to file, which can be problematic if a physician didn't turn in her charges in a timely manner or a file is lost, noted Doral Davis-Jacobsen, manager of healthcare consulting at Dixon Hughes Goodman in Asheville, N.C. Allow for sufficient time to file those claims.

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