Three key payer contracts’ clauses to look out for, by Steve Selbst, CEO and Co-Owner of Healthcents Inc., (email@example.com or 831-455-2174):
- Favored Nation Language: While rare, favored nation language means that you will guarantee a payer that their rates are the same or less than all of your other payers’ rates. My advice is simple, never accept this language in a payer contract. It is problematic both because it would cause your company or practice to potentially lower rates on a negotiated agreement and it would also be difficult and impractical to monitor such a clause.
- Lesser of Billed Charges or Contracted rates: Almost all payer agreements have a clause that specifies that the payer will pay you the lesser of your billed charges or contracted rates. This means that your charge master rates for all codes / services must be set above the highest contracted rate for each code in each agreement. It is a good idea to price your charge master at UCR thresholds, which generally means that rates would be priced in the 225%-300% of local Medicare rates for codes / services. This should enable you to not be paid below your agreed upon contracted rates and, at the same time, remain competitive with your cash paying patients.
- Retrospective reviews: For over payments, make sure that there is a reasonable time limit, 3-6 months maximum, ideally. Otherwise, you may find your company or practices owing large sums of money years down the road due to claims’ audits that may reveal over payments.
To contact Healthcents for more information: For a free 1/2 hour payer contracts’ consultation with our President and Founder, click here: Free Consultation. You may also contact Healthcents by emailing firstname.lastname@example.org or by phone at 1-800-497-4970.