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Are you curious how rates and changes in the market are affecting managed care contracting in 2016?  If you find yourself new to managed care contracting, or you just want to make sure you are up your game, read this article.  James Jones, Contract Manager with abeo, was among three industry experts that recently sat down to discuss ASC managed care contracts with The Ambulatory M&A Advisor.  The article, Managed Care Contracts and ASCs in 2016 written by Richard Romero, is loaded with good advice.  Here is a quick rundown.

  1. Use the CMS Medicare year on year published rates as a benchmark.  Look for trends or patterns in the movement of the the CMS Medicare rates.
  2. Look at the variants and opportunities in your contracts.  The contract details matter.  What makes your providers and surgery center stand out?  Consider the services provided, provider specialty, geography, customer service and competition in the area.  Understand what the agreement is offering you.
  3. Negotiation is almost always an option and it’s the only way you will see higher reimbursement rates.
  4. Develop negotiation strategies for every contract and consider all the factors that come into play with price differentiation.
  5. Look beyond the standard fee schedule and breakdown your business by surgical codes.  Study the reimbursement rates for each code category.
  6. Check the CMS website regularly to stay abreast of recent changes that could result in minor contract revisions.
  7. Proprietary grouper methodology means the payor groups CPT codes together as they choose.  Higher acuity codes translate to the higher grouper.
  8. The CMS methodology eliminates the grouper approach.  In this methodology an ASC fee schedule is combined with categories of grouped procedures.
  9. Most managed care contract renewals are two to three year contracts.
  10. An evergreen agreement means the terms are enforced as long as the parties choose.
  11. In any contract, know the arrangements for term without cause.  Sometimes providers determine a plan is not working well for them and if within that window they have the option to term without cause which can be very beneficial.  It is more simple than say a breach of contract where a violation of the contract by the non offending party has to be cited.

Reference the full article to read in more detail what these three industry experts had to say on contract reviews, negotiation strategies and payor methodologies.  abeo has a dedicated team to assist our clients with managed care contracting.  Our messenger model approach upholds our integrity to operate in a compliant manner for our clients.  If you would like to understand more about how we can assist your ambulatory surgery center, drop us a line here.


abeo Management Corporation (abeo) serves as a leading source of revenue cycle management and practice management with a specialization in anesthesia. The company leverages its people, processes, and software to serve independent practices, surgery centers, hospitals and healthcare systems with a scope of services that include billing, coding, transcription, practice management, and business consulting.

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