Many physicians pay very little attention to their managed care participation agreements. In fact, some simply sign these agreements without ever reading them. I think this apathy stems from the fact that managed care plans generally refuse, at least for smaller practices, to “negotiate” their fee schedules. But, even if a payor won’t negotiate fees, participation agreements typically include other significant legal provisions worthy of review and, in some cases, negotiation. Here are just a few:
Definitions. State law may mandate that plans adopt specific definitions for certain key terms such as “medical necessity”, “clean claims”, covered services” and emergency services”. It is important to review and understand these and other critical terms used in the agreement and make sure they confirm to state law if applicable.
Billing for non-covered services. If you want to be able to bill patients for non-covered items and services like completing forms or preventive care, knowing how and when this is permissible may be spelled out in the agreement.
Benefit plans and programs. More and more often managed care companies are contracting out their network to various other benefits plans. In addition, through mergers and consolidation, plan affiliates and subsidiaries change quite frequently. In order to know how much you are entitled to be paid and who is responsible for paying you, it is important to know what plans, programs, and affiliates may be covered by the particular agreement.
Policies and procedures. Many participating agreement reference and incorporate a host of policies and procedures (sometimes referred to as a provider manual). Because these are usually made legally binding on participating physicians by virtue of incorporation into the agreement, physicians should be sure to obtain and review these.
Overpayments. Some participation agreements give the payor the unilateral right to recoup overpayments from future payments to a practice. This can cause significant confusion when it comes to reconciling payments as it is not always clear when a payment has recouped or to which patient the recoupment relates. Moreover, the practice does not have an advance opportunity to review and challenge the overpayment determination. When it comes to overpayments, my recommended approach is to require payors to notify the provider an an overpayment and allow the provider a period of time to review and dispute it. No recoupment should occur until any disputes are resolved.