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Negotiation Tips for Physicians


A value-driven healthcare system ensures that the doctors are adequately compensated for their services. The relative financial risks to physicians must be minimized if the payment model being utilized is to succeed. Most physicians either don’t know that the amounts reimbursed by your insurance plans can be negotiated or simply do not wish to engage in the negotiation battle and lengthy meetings that are implied. Negotiating is easier if the right approach is followed and will give the practice both short-term and long-term benefits.

Physicians and the Art of Negotiation

Negotiating a contract with a health plan is a complex, time-consuming, and frustrating task. Family physicians find themselves getting the short end of the stick. The contract being offered by default has been prepared by an army of financial, legal and administrative experts who will want to pay the lowest rates they can. Negotiating can be tricky and requires delving into piles of research. Physicians might not be natural negotiators; however the advantage here is that almost all physicians are experts at detailed analyses and research.
· Be patient and tenacious
· Be willing to walk away from unsatisfactory offers
· Accept the fact that there will be a lot of back-and-forth
· Build your business case
· Communicate it clearly

The Basic Process of Negotiating Health Care Plans

The first aspect that a physician needs to determine is what factors will improve their leverage during the negotiation. Having a clear idea of what you bring to the table can make the difference between having to settle for a low rate and getting the rate that you deserve.
Gesme and Wiseman offers the following general advice to increase reimbursement from private payers:
Self-Assessment and Preparation- SWOT and KPIs
The key to successful negotiation strategy is readiness. Do a thorough SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of the practice. Look at all the factors objectively and critically. Check all your past data, measure the major key performance indicators (KPI’s) related to costs, quality and time. General practices normally have five areas that the KPIs are based on:
1) Financial performance
2) Patients
3) Employees
4) Medical data and patient services
5) Expenses
Comparative data is also required so check your position in quality assessment programs such as Physician Quality Reporting Initiative.

Monitor Your Present Contracts

Contracts are automatically renewed unless one party proposes a modification. Analyze your contract and decide exactly which changes you need. You should also know what percentage of your business is represented by the payer.

Good Negotiation Tactics-A Summary

● Present your requests for changes
● Ensure that the data you present is relevant, well-organized and clear.
● Listen to the other side and understand their goals
● Offer proof for any cost-minimizing measures you have implemented