When it comes to negotiating fees with health plans, practices and physicians have more leverage than they realize. The problem, is that practices often don’t even try. “Groups negotiate an agreement with a payor and then, for whatever reason, just file it away. Most medical groups do not have a good, proactive methodology for negotiating for physician reimbursement,”

There is a Adversarial fee negotiating environment that has existed between physicians and health plans is changing to a more cooperative partnership between payors and providers. As an example, of a physician group whose contracts were renegotiate. When contacting the medical director of the group’s largest payor and indicated the group wanted to renegotiate its contract and fee schedule, and suggested talking about a pay-for-performance arrangement. Not only was the medical director receptive, but also arranged to meet with members of the physician group to further discuss the arrangement. “What used to be a poker game is now transparent. The realization is, we all have an economic problem with respect to medical costs. But the doctors have the clinical solutions to those economic problems. Health plans are saying, ‘Let’s see if we can’t be better business partners not only for our sake, but for the sake of the patients and the community as well.’ It’s a new era of managed care, which is really what it should have been when it kicked off twenty years ago.

There are several ways physicians can begin renegotiating fees with health plans. If a physician is hospital-based, he or she has a little more leverage. For example, the physician is performing services at a hospital and being paid the health plans’ usual, customary rates for that location. The physician asks for an increase, and the health plan says no, so the physician cancels his or her contract and begins working non-contracted with the plan, knowing that the plan’s patients are going to come to the hospital regardless of whether he’s contracted with the payor or not. But now, the physician begins billing the patient for 100 percent of their fee schedule. The health plan will pay what it believes is appropriate, and the balance is owed by the patient