I'm about 6 months out from applying to a couple insurance panels for my private practice. I'm curious if there are any tips for negotiating with them. In my head I'm envisioning they give me a rate, I tell them no I want X, they say take it or leave because they are a huge corporate entity and I have no other options. Perhaps I'm missing something because I often hear people say to negotiate. Any thoughts?
Negotiating with insurance payors
- Thread starter Psychresy
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A great point above. If they genuinely will not negotiate, then no strategy works. If they will negotiate, true willingness to walk away (because of other / better options) is your best bet. I don't take insurance in PP but if I did I would:
-Figure out the cash market and have that running in parallel. It gives you a potential out if the insurance companies are obnoxious.
-Apply for many panels but plan to start taking only a few. Cherry pick the best offers (which is likely to get you further than playing hard ball with bad offers), and see if the best offers will do better (at least ask). Expand to other panels only if needed.
-Have a plan to avoid desperation for money early on. Live cheap, have savings, take a part-time job, something. Don't make your mortgage payments dependent on the insurance company's good graces.
-Decide realistic minimum standards and turn policies down if they cannot exceed them. If you find no one meets your standards, then you probably need to readjust expectations for your area.
-If solo is not working well, consider group options. They have more power to negotiate, and can share overhead in a more efficient way (for example renting a 5-office space is probably cheaper than five separate private offices, sharing a biller and reception among five psychiatrists is probably more realistic than each psychiatrist seeking these services on their own).
But in short, have options. If you will be taking insurance no matter how bad the offer, they have a much easier time exploiting you.
-Figure out the cash market and have that running in parallel. It gives you a potential out if the insurance companies are obnoxious.
-Apply for many panels but plan to start taking only a few. Cherry pick the best offers (which is likely to get you further than playing hard ball with bad offers), and see if the best offers will do better (at least ask). Expand to other panels only if needed.
-Have a plan to avoid desperation for money early on. Live cheap, have savings, take a part-time job, something. Don't make your mortgage payments dependent on the insurance company's good graces.
-Decide realistic minimum standards and turn policies down if they cannot exceed them. If you find no one meets your standards, then you probably need to readjust expectations for your area.
-If solo is not working well, consider group options. They have more power to negotiate, and can share overhead in a more efficient way (for example renting a 5-office space is probably cheaper than five separate private offices, sharing a biller and reception among five psychiatrists is probably more realistic than each psychiatrist seeking these services on their own).
But in short, have options. If you will be taking insurance no matter how bad the offer, they have a much easier time exploiting you.
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I started as a solo practice in January 2019 and it's mushroomed to over a dozen providers. Here is what I did.
-took Medicare (pays decent here)
-was lucky enough to be paneled into BCBS without having to take medicaid
-I did take insurances like Optum and accepted their terrible rates, less than $50 per 99213 and less than $50 for a 90833.
-my first year worked my tail off and built up quickly
-once I had a lot of Optum's members under my care but was also established with a panel from other payors, then I negotiated more assertively. I think at that point, they did not want to lose the psychiatric care that was established
-helps to have an idea of what the market rate overall is based on other commercial payors, medicare, cost of living and cost of living adjustments, etc.
-approach the negotiation professionally, in a friendly way, but firm
-insurances want to know how you will help them keep medical costs down. Do you get people in quick? Do you do psychotherapy as well? What about long acting injections? Are you familiar with ECT and how to refer a good candidate? Do you send claims electronically and use ERAs and EFTs to save healthcare costs?
-follow up with insurances regularly about the negotiating thread. Many will ghost you. Keep a recurring reminder on. Follow close but don't be a pest.
-keep records and track of what exactly was agreed on, especially with Optum. Ask for it in writing. Ask for the updated contracts, amendments, and effective dates in writing. Keep track of who you discussed with, when, what was said. I preferred to keep email threads because some of these discussions literally dragged for over 3 years.
-then check your remittances and bank payments to make sure the insurance is actually following through. It's not uncommon for payors to conveniently not increase the payout in the claim system. I usually send one claim first, then see. Once the all clear is there, I send all the other claims.
-and don't forget to keep on: market, market, market. The stronger of a pipeline or referrals you have, the more payors and rates you can choose from. You can be preferential to the better payors. Then the payors who don't treat you as well have to compete for your services.
On first starting, as a solo provider it was very "take it or leave it, you're just one provider." I had to build my worth to the insurance company but the more people they have under your care, the more their stake is in it. imho, optum and cigna are the worst for negotiating with. Your local insurances like the market place ones, the ones based in your state tend to be the BEST. Also, many hospital systems offer their employees a unique insurance that may say, use BCBS as their third party administrator. It's not hard to get contracted with those. Being paneled with say, BCBS will NOT have you in their network, you need to apply for the individual hospital employee insurance contract and often the contract rates will be different and substantially higher than regular BCBS/Aetna/etc. The hospital employee insurances are really really great as they tend to have awesome rates and/or may let you negotiate more. The big national ones like Aetna, Humana, Optum, Cigna are really tough to negotiate with. Especially Optum and Cigna. Local insurances are the way to go and make good connections with hospital system HR departments and Ob/Gyn.
-took Medicare (pays decent here)
-was lucky enough to be paneled into BCBS without having to take medicaid
-I did take insurances like Optum and accepted their terrible rates, less than $50 per 99213 and less than $50 for a 90833.
-my first year worked my tail off and built up quickly
-once I had a lot of Optum's members under my care but was also established with a panel from other payors, then I negotiated more assertively. I think at that point, they did not want to lose the psychiatric care that was established
-helps to have an idea of what the market rate overall is based on other commercial payors, medicare, cost of living and cost of living adjustments, etc.
-approach the negotiation professionally, in a friendly way, but firm
-insurances want to know how you will help them keep medical costs down. Do you get people in quick? Do you do psychotherapy as well? What about long acting injections? Are you familiar with ECT and how to refer a good candidate? Do you send claims electronically and use ERAs and EFTs to save healthcare costs?
-follow up with insurances regularly about the negotiating thread. Many will ghost you. Keep a recurring reminder on. Follow close but don't be a pest.
-keep records and track of what exactly was agreed on, especially with Optum. Ask for it in writing. Ask for the updated contracts, amendments, and effective dates in writing. Keep track of who you discussed with, when, what was said. I preferred to keep email threads because some of these discussions literally dragged for over 3 years.
-then check your remittances and bank payments to make sure the insurance is actually following through. It's not uncommon for payors to conveniently not increase the payout in the claim system. I usually send one claim first, then see. Once the all clear is there, I send all the other claims.
-and don't forget to keep on: market, market, market. The stronger of a pipeline or referrals you have, the more payors and rates you can choose from. You can be preferential to the better payors. Then the payors who don't treat you as well have to compete for your services.
On first starting, as a solo provider it was very "take it or leave it, you're just one provider." I had to build my worth to the insurance company but the more people they have under your care, the more their stake is in it. imho, optum and cigna are the worst for negotiating with. Your local insurances like the market place ones, the ones based in your state tend to be the BEST. Also, many hospital systems offer their employees a unique insurance that may say, use BCBS as their third party administrator. It's not hard to get contracted with those. Being paneled with say, BCBS will NOT have you in their network, you need to apply for the individual hospital employee insurance contract and often the contract rates will be different and substantially higher than regular BCBS/Aetna/etc. The hospital employee insurances are really really great as they tend to have awesome rates and/or may let you negotiate more. The big national ones like Aetna, Humana, Optum, Cigna are really tough to negotiate with. Especially Optum and Cigna. Local insurances are the way to go and make good connections with hospital system HR departments and Ob/Gyn.
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I dropped UHC in the past, was blunt, you don't pay enough, and you reject too many codes that other companies pay for. Pay me X or more to get in line. They balked. I submitted my termination. But then they got shady saying you didn't send it to Optum, you sent to UHC, and other things. I had my email trails and or fax trails saved, and said no you are all full of scat. On my way they contacted me to say they would pay the equivalent to medicare rates in that area. Not interested. They were also the biggest source of headaches for my assistant, and they would also months later disproportionately request refunds for 'non services' or other Scat things. It was a volume drop as they were about ~18% of the local market, but such a relief to not deal with them. They of course kept me on their directory etc for months. ~10% [I have the exact number on my private practice thread] converted to be cash only and continue on.
Cigna in the past I basically said pay me more I drop. They nudged up to medicare rates, from below medicare.
I recently moved from an area that was an anomaly for higher payments to psych - but even at that - they were still way lower than the local Big Box shops. Image a colorful religious symbol company paying more than double medicare, but almost triple to the local Big Box shops. My new local area, I was flawed in my pre-move reconnaissance of rates - that same colorful religious symbol company, is barely paying better than medicare. It's a substantial punch to the gut for what this means for my practice. I now have to play the volume game. I tried to escalate a petition of 'WTF, pay me more.' They didn't care. Positively, this new area I'm in has a decent flow of patients coming in compared to previous area that was saturated.
For people who are starting out with practices: I was more receptive to insurance scat, when the rates were higher in past location, but now the new location is lower, the zeal to continue with their BS is less. If you go to an area like most of the country is, you'll need to be @randomdoc1 and read over as many of those posts as possible for guidance. Otherwise, if you have the desire/drive/skills for therapy, just open up a lean tiny office, cash only, therapy focused practice and enjoy the small panel.
I intend to stick with my original plan. Build up the panel, and once closer to full, I let the biggest headache or lowest paying insurance know, they need to increase their rates or drop. I have no intention to play the game others above have, with "justifying" or trying to "show" why higher rates are justified. Odds are the balk, I walk. Patients that move on, open up more slots for the other higher paying insurance and I accrue a few more cash pay patients. Repeat once closer to full.
Cigna in the past I basically said pay me more I drop. They nudged up to medicare rates, from below medicare.
I recently moved from an area that was an anomaly for higher payments to psych - but even at that - they were still way lower than the local Big Box shops. Image a colorful religious symbol company paying more than double medicare, but almost triple to the local Big Box shops. My new local area, I was flawed in my pre-move reconnaissance of rates - that same colorful religious symbol company, is barely paying better than medicare. It's a substantial punch to the gut for what this means for my practice. I now have to play the volume game. I tried to escalate a petition of 'WTF, pay me more.' They didn't care. Positively, this new area I'm in has a decent flow of patients coming in compared to previous area that was saturated.
For people who are starting out with practices: I was more receptive to insurance scat, when the rates were higher in past location, but now the new location is lower, the zeal to continue with their BS is less. If you go to an area like most of the country is, you'll need to be @randomdoc1 and read over as many of those posts as possible for guidance. Otherwise, if you have the desire/drive/skills for therapy, just open up a lean tiny office, cash only, therapy focused practice and enjoy the small panel.
I intend to stick with my original plan. Build up the panel, and once closer to full, I let the biggest headache or lowest paying insurance know, they need to increase their rates or drop. I have no intention to play the game others above have, with "justifying" or trying to "show" why higher rates are justified. Odds are the balk, I walk. Patients that move on, open up more slots for the other higher paying insurance and I accrue a few more cash pay patients. Repeat once closer to full.
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Furthermore I had one friend, who's also on SDN, comment about feeling minimal concerns about inflation as this person works a state hospital and VA job. Both, government connected and I believe rise with inflation and cost of living. I get this view of "meh." This segment of the healthcare sector is the exception.
I though, resonate with the Fox News talking points embodying "Let's Go Brandon" as it relates to the economy, and inflation. In the past several years I only had ONE insurance company raise its rates voluntarily, twice, and then their third change, was to reduce them more than the previous 2 increases. None of the other companies raised their rates. So for those of us in insurance based private practices we have no means to keep pace with inflation. My original lease/landlord made it very clear in the lease contract, that each year the base rate goes up 3% minimum, and the "common area expenses" are entirely passed on to the tenants as its a Triple Net lease. My newest landlord said same thing, 'in a year when lease is up, count on the rates going up to keep pace with inflation.'
Inflation crushing the purchasing power of what income we do generate. Then overhead costs going up, and insurance companies racing to the bottom for reimbursement. Triple cut. If you have the ability to build up a cash only therapy based practice, do it.
Then of course the UHC, which is a top 10 company in S&P 500... has been gobbling up laterally. They purchased ChangeHealthcare which sends those pseudo threatening letters to us saying you are billing code XYZ too much compared to their erroneous data to scare us into down coding. Lawsuits to stop the acquisition failed, and its purchase has finally gone through via the courts. ChangeHealthcare also happens to now do the paperwork ERA enrollments for ApexEDI which is the clearing house contracted by Luminello to submit claims. Oh, and ApexEDI was bought by UHC/Optum, too! It's impossible to get away from UHC.
I though, resonate with the Fox News talking points embodying "Let's Go Brandon" as it relates to the economy, and inflation. In the past several years I only had ONE insurance company raise its rates voluntarily, twice, and then their third change, was to reduce them more than the previous 2 increases. None of the other companies raised their rates. So for those of us in insurance based private practices we have no means to keep pace with inflation. My original lease/landlord made it very clear in the lease contract, that each year the base rate goes up 3% minimum, and the "common area expenses" are entirely passed on to the tenants as its a Triple Net lease. My newest landlord said same thing, 'in a year when lease is up, count on the rates going up to keep pace with inflation.'
Inflation crushing the purchasing power of what income we do generate. Then overhead costs going up, and insurance companies racing to the bottom for reimbursement. Triple cut. If you have the ability to build up a cash only therapy based practice, do it.
Then of course the UHC, which is a top 10 company in S&P 500... has been gobbling up laterally. They purchased ChangeHealthcare which sends those pseudo threatening letters to us saying you are billing code XYZ too much compared to their erroneous data to scare us into down coding. Lawsuits to stop the acquisition failed, and its purchase has finally gone through via the courts. ChangeHealthcare also happens to now do the paperwork ERA enrollments for ApexEDI which is the clearing house contracted by Luminello to submit claims. Oh, and ApexEDI was bought by UHC/Optum, too! It's impossible to get away from UHC.
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