Basic Tips for Negotiating Managed Care Contracts

Basic Tips for Negotiating Managed Care Contracts

Do your research-

  • Does the plan pay on time?
  • Does the plan provide assistance in educating the office staff?
  • What do other providers think of the plan?
  • Is there a merger in the works?
  • If an ERISA plan, is the company financially stable?
  • Can they use your name in plan advertisements?
  • Are there any pending litigations with other providers?
  • Speak directly to other providers regarding level of service and level of satisfaction.

If possible create a contracting team- this should include CFO, Director of Decision

Support/Financial Analysis, providers, legal counsel, billing manager and PR.

Contractual Provisions
Request copies of any documents incorporated by reference such as:

  • provider policy and procedure manuals
  • subscriber plan documents
  • utilization and authorization procedures guidelines
  • review these documents prior to signing any contract

Have this language included in the contract:

Any document incorporated by reference in this agreement must be provided to provider prior to the execution of the agreement. No changes may be made to any such document without the prior written consent of the provider.

Questions to be asked and answered- (get answers in writing)

  • Medical necessity- who determines medical necessity? Where are the criteria posted?
  • What is the contract term? Does it include automatic renewal provisions or annual rate negotiations?
  • What are the termination provisions?
  • Notification of the covered person should be the responsibility of the plan.
  • What are the procedures to determine patient eligibility? Web based? Telephone system? Is a transaction number given?
  • Does the plan require other data than what is submitted on a clean CMS 1500 or UB 92?
  • Is coordination of benefits the plans responsibility or the providers? How do you determine which plan is primary?  Include language that states the secondary insurance will accept the precertification/authorization compliance of the primary plan.
  • What are the provisions for dispute resolution?
  • What services can be billed to members? Non-covered services, co pays, deductibles
  • What is the time frame for submission of claims and payment of claims?
  • What fee schedule is being used?
  • Do not accept bundling of charges other than those shown under Medicare guidelines.
Share this