I am trying to find benchmarking information regarding managed care contracting (e.g., an average number of active negotiations and an average number of maintenance agreements). Any information regarding contracting workload would be appreciated.
Answer 1: I doubt such a benchmark would exist. A new hospital or physician group would need to start from scratch negotiating with all the payers in the market, which would have to be at least the local Blue plan and the major national plans. It would be hard to benchmark how many negotiations or re-negotiations would be going on at one time for an established provider.
My guess is that it helps if the provider sets up some of the contracts to end at different times of the year, and some contracts are multi-year, just to make life easier.
This question was answered by: Ruth Landé, vice president, patient revenues, Memorial Sloan-Kettering Cancer Center, New York, N.Y., and a member of HFMA’s Metropolitan New York Chapter.
Answer 2: If you use outside contractors to load the details of your managed care contracts into software to find underpayments and to assist in challenging payment denials, I recommend making sure that the contractors give you input into any new health plan contract negotiations. If you have your own organization’s staff managing underpayments and denials on a daily basis, I recommend you get input from staff as well.
Also, I recommend that a given provider organization take a strong contracting position with any health plan that has a weak market position in the provider’s geographic area. In most cases, the health plan needs the provider much more than the provider needs the health plan.
This question was answered by: Robert J. Ellertsen, FHFMA, a former hospital CFO with more than 35 years of experience in healthcare finance, and a member of HFMA’s Massachusetts-Rhode Island Chapter.
Answer 3: Each organization has unique situations in their marketplaces that may require different types of staffing levels and skill levels, as well as different types of analyses (e.g., capitation, fee for service, size of population covered). Also, each organization over time should have the ability to scale contracts to get refreshed on different calendar cycles (i.e., multiple-year contracts, etc.).
This question was answered by: Matt Levsen, CPA, MBA, FHFMA, former associate CFO, University of Missouri Health Care, and a member of HFMA’s Show Me State of Missouri Chapter.
Answer 4: I am not aware of any current benchmarks related to managed care contracting. There are, however, recommended contract terms and conditions for managed care contracts from a variety of associations.
This question was answered by: Caswell Samms, III, vice president and CFO, WellStar Kennestone, Marietta, Ga.
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