Successful payer contracting is crucial to the success of any ASC. While such contracting can prove difficult amid a changing reimbursement landscape, ASC administrators can safeguard the success and fiscal health of their respective organizations by taking advantage of the opportunities currently available for increasing revenue through fruitful payer contracting.
Two ASC leaders and an ASC revenue cycle expert discussed payer contracting for ASCs at the Becker's ASC 24th Annual Meeting: The Business and Operations of ASCs in Chicago on Oct. 27.
Panelists included:
- Alfonso del Granado, administrator for Hoffman Estates, Ill.-based Ashton Center for Day Surgery and compliance officer for Oak Brook (Ill.) Medical Management
- Brenda Cordle, CEO for Surgery Center of Fort Collins (Colo.)
- Lisa Rock, president of St. Louis, Mo.-based National Medical Billing Services
Here are three key insights from the discussion.
Use data to maximize reimbursement
While reimbursement models for surgery centers have shifted away from the simpler grouper payments commonly implemented 10 years ago to more complex methodologies, there is currently more opportunity for ASCs to achieve higher payer reimbursement than in the past.
"We're seeing so many more cases come to surgery centers: more orthopedic, more spine, overall more complex procedures," Ms. Rock said. "It's a tremendous opportunity, but if you want to be effective and truly make a positive financial impact on your center, then you have to collect as much data as you can and present it to the payers in a thoughtful and compelling fashion. They'll be open to that, if you're going to show them how to simultaneously improve their bottom line."
ASCs should calibrate data given to payers to display the center's ability to migrate cases away from the hospital and save money. Measures that may prove useful in payer negotiations include complication rates, hospitalization rates, infection rates and cost per procedure data. In regards to data on costs, it's important for ASC administrators to be selective.
"We don't put all of our costs out there," Mr. Granado said. "Our goal is to say [to the payer,] 'look, this is what you're paying at hospitals, this is what you're offering us, let's meet somewhere in the middle.' We try to push that [negotiation] as far to their side as possible."
Know your contracts and don't get lost in the rate sheet
With previous experience working on the payer side of contracting, Ms. Rock said it's important for ASC leaders to be knowledgeable about their contracts and keep complete, updated copies. They should not get lost in the payers' rate sheets for surgery centers - they need to review and understand all language along with the rate sheet while negotiating. They should also abstain from trying to manage their revenue cycle with a rate sheet alone, according to Ms. Rock.
"You have to take the top three, four or five cases and look at your code combinations for the case … list out all the codes and reimbursements in your top cases, list out your costs and then compare it to Medicare to see where you line up … you need to see where you really fall, and then you'll know what to do when you go back to the payer," said Ms. Rock.
Build relationships with payers
During the discussion, Ms. Cordle said ASCs must also work diligently to build a strong relationship with the payer.
"It's really imperative that you build relationships with these payers," Ms. Cordle said. "Because they don't care really what your costs are, and they really are only looking to see what benefits the plan."
Ms. Cordle suggested making one staff member on the billing team responsible for gathering data for the payer and developing a positive relationship with the entity and any third-party self-funded groups.
"Where I've had wins [in payer contracting] is when I've been able to build a relationship with self-funded groups and the payer," Ms. Cordle said. "When I'm negotiating a contract directly or through a contractor, I ask up front for a list of all the payers that they have, and then we see who we can bring to the table and talk about their specific needs, which shows a willingness to cooperate."