, say experts in physician-payer contracts.
Many doctors sign long-term agreements and then forget about them, says Marcia Brauchler, president and founder of Physicians’ Ally, Littleton, Colorado, a health care consulting company. “The average doctor is trying to run a practice on 2010 rates because they haven’t touched their insurance contracts for 10 years,” she says.
Payers also make a lot of money by adopting dozens of unilateral policy and procedure changes every year that they know physicians are too busy to read. They are counting on the fact that few doctors will understand what the policy changes are and that even fewer will contest them, says Greg Brodek, JD, chair of the health law practice group and head of the managed care litigation practice at Duane Morris, who represents doctors in disputes with payers.
These experts say doctors can push back on one-sided payer contracts and negotiate changes. Mr. Brodek says some practices have more leverage than others to influence payers – if they are larger, in a specialty that the payer needs in its network, or located in a remote area where the payer has limited options.
Here are seven key areas to pay attention to:
1. Long-term contracts. Most doctors sign multiyear “evergreen” contracts that renew automatically every year. This allows insurers to continue to pay doctors the same rate for years.
To avoid this, doctors should negotiate new rates when their agreements renew or, if they prefer, ask that a cost-of-living adjustment be included in the multiyear contract that applies to subsequent years, says Ms. Brauchler.
2. Fee schedules. Payers will “whitewash” what they’re paying you by saying it’s 100% of the payer fee schedule. When it comes to Medicare, they may be paying you a lot less, says Ms. Brauchler.
“My biggest takeaway is to compare the CPT codes of the payer’s fee schedule against what Medicare allows. For example, for CPT code 99213, a 15-minute established office visit, if Medicare pays you $100 and Aetna pays you $75.00, you’re getting 75% of Medicare,” says Ms. Brauchler. To avoid this, doctors should ask that the contract state that reimbursement be made according to Medicare’s medical policies rather than the payer’s.
3. Audits. Commercial payers will claim they have a contractual right to conduct pre- and post-payment audits of physicians’ claims that can result in reduced payments. The contract only states that if doctors correctly submit claims, they will get paid, not that they will have to go through extra steps, which is a breach of their agreement, says Mr. Brodek.
In his experience, 90% of payers back down when asked to provide the contractual basis to conduct these audits. “Or, they take the position that it’s not in the contract but that they have a policy.”
4. Contract amendments versus policies and procedures. This is a huge area that needs to be clarified in contracts and monitored by providers throughout their relationships with payers. Contracts have three elements: the parties, the services provided, and the payment. Changing any one of those terms requires an amendment and advance written notice that has to be delivered to the other party in a certain way, such as by overnight delivery, says Mr. Brodek.
In addition, both parties have to sign that they agree to an amendment. “But, that’s too cumbersome and complicated for payers who have decided to adopt policies instead. These are unilateral changes made with no advance notice given, since the payer typically posts the change on its website,” says Mr. Brodek.
5. Recoupment efforts. Payers will review claims after they’re paid and contact the doctor saying they found a mistake, such as inappropriate coding. They will claim that the doctor now owes them a large sum of money based on a percentage of claims reviewed. “They typically send the doctor a letter that ends with, ‘If you do not pay this amount within 30 days, we will offset the amount due against future payments that we would otherwise make to you,’” says Mr. Brodek.
He recommends that contracts include the doctors’ right to contest an audit so the “payer doesn’t have the unilateral right to disregard the initial coding that the doctor appropriately assigned to the claim and recoup the money anyway,” says Mr. Brodek.
6. Medical network rentals and products. Most contracts say that payers can rent out their medical networks to other health plans, such as HMOs, and that the clinicians agree to comply with all of their policies and procedures. The agreement may also cover the products of other plans.
“The problem is that physicians are not given information about the other plans, including their terms and conditions for getting paid,” says Mr. Brodek. If a problem with payment arises, they have no written agreement with that plan, which makes it harder to enforce.
“That’s why we recommend that doctors negotiate agreements that only cover the main payer. Most of the time, the payer is amenable to putting that language in the contract,” he says.
7. Payer products. In the past several years, a typical contract has included appendices that list the payer’s products, such as Medicare, workers compensation, auto insurance liability, or health care exchange products. Many clinicians don’t realize they can pick the plans they want to participate in by accepting or opting out, says Mr. Brodek.
“We advise clients to limit the contract to what you want covered and to make informed decisions, because some products have low fees set by the states, such as workers compensation and health care exchanges,” says Mr. Brodek.
A version of this article first appeared on Medscape.com.