5 Strategies to Manage Payer Contract Optimization for Improved RCM

Revenue Cycle Management holds a major value in healthcare practice. It is necessary to ensure the practice’s financial stability and success. To improve revenue cycle performance, better payer contract management is crucial which enhances healthcare organization revenue.

In this blog post, you’ll learn the 5 best strategies to manage healthcare payer contracts effectively. Utilizing this strategy in healthcare practice, payer contract management can become a key strategic advantage, allowing your practice to achieve greater profitability and stability in operation.

What is Payer Contact in Healthcare?

Initially understanding what is payer contact in healthcare is important for healthcare providers. It is a formal agreement between the healthcare professionals and the insurance companies which is a payer organization. 

This includes private health insurance and government health programs like Medicaid and Medicare. They establish the precise conditions under which services will be provided and paid for. They contain crucial information such as:

• Medical procedures and services that are included under the contract.
• Your practice will be reimbursed for each service. 
• Specific codes and billing procedures are required to receive payment. 
• The process and timing for submitting claims to secure payment. 
• The steps to take if your payment is denied or reduced.

Related: 9 Strategies You Should Follow to Improve Revenue Cycle Management

5 Strategies to Manage Payer Contact in Healthcare RCM

Here are the 5 strategies healthcare practices should implement to manage payer contact in healthcare RCM.

1. Implement Advanced Contract Management Tools

Software solutions are making a greater impact in the healthcare industry. 

By leveraging contract management tools, practices can easily centralize storage, and access, and efficiently manage all the payer contracts. 

This way, practices can streamline the entire process. It helps to completely replace the manual tracking methods like using a file storage system.

• Using contract management tools, practices can significantly reduce the risk of errors that are associated with manual data entry.
• All team members can have access to up-to-date information which improves communication, and coordination, and enables quicker decision-making.
• This tool also has automated reminders for important dates like contract renewals and expirations. This way, you will never miss negotiations and adjustments.

2. Thoroughly Review Clauses and Details

Healthcare practices need to take more time to thoroughly review all the clauses and details in the payer contract. While reviewing the payer contract, make sure to check out these things carefully:

• Fee schedules
• Reimbursement rates
• Termination conditions
• Claim filing deadlines

Thoroughly reviewing the payer contract will help you to understand the ins and outs of the payer contracts, providers can flag less favorable terms. 

Regulation changes ought to be reflected in contracts. Verifying compliance with the contract requirements helps you stay out of trouble with the law and avoid possible fines. Understand the reasons that allow for contract termination or renegotiation. This equips you to overcome any challenges that may arise.

3. Schedule Alerts for Renegotiation and Termination

Healthcare practices should identify all the critical dates related to renegotiation and termination. After that, utilize the contract management tool to schedule automated alerts. This way, providers can:

• Healthcare professionals should always be ready for renegotiation talks. You can use this as leverage to secure better terms.
• Unwanted automated renewals are avoidable. You might be forced into less favorable terms by these.

4. Track and Evaluate Performance Metrics

After implementing the strategies, it is critical to track the evaluate the performance metrics for continuous improvements. Define and track the key performance metrics and SLAs (Service Level Agreements).

• KPIs demonstrate how successfully a healthcare company achieves its objectives. 
• The claim denial rate is one illustration. 
• It calculates the proportion of claims that payers reject. A reduced rate indicates improved coding and billing.
• SLAs are official agreements that specify the expected levels of service that users and suppliers will receive. 
• The time it takes to process a claim in the healthcare industry serves as just one example. 
• It can be said that 20 days is the average turnaround time for 90% of claims.

Tracking and monitoring the performance metrics will help you to:

• Analyze the performance of the contract which helps to identify the trends. Practices can identify the areas of improvement and concerns.
• Practices can decide wisely if you have timely and reliable data. These have an impact on the continuance, amendment, or termination of contracts.
• You have the authority to verify and enforce contract compliance.

5. Conduct Comprehensive Vendor Credentialing

Vendor credentialing verifies that suppliers meet the requirements and abide by industry regulations. This guarantees that healthcare facilities only collaborate with competent and reliable vendors.

The following are some advantages of vendor oversight and credentialing:

• Robust compliance: Credentialing reduces the possibility of legal issues.
• Enhanced service quality: Vendors are always held to performance standards thanks to routine inspections. This improves patient happiness and the quality of the services provided.
• Protection of revenue: Establishing credentials helps prevent payment refusals or delays. When service providers attempt to deliver services but do not meet the requirements, this is crucial. 

Related: 8 Actionable Steps to Increase Your Practice Revenue by 10x with RCM

Vozo Revenue Management Cycle Service for your Medical Practice

At Vozo, we understand your struggle in navigating through all the revenue cycle processes such as regulations, medical coding, and reimbursements. 

That’s why we bring the best cutting-edge service to optimize your revenue cycle management from start to finish. Here’s how Vozo can help you to transform your practice’s financial performance.

• Automated tools for error-free coding and faster reimbursements
• User-friendly billing to keep patients satisfied and payments flowing
• Robust data security and compliance protocols to protect your practice
• Detailed reporting and analytics for smarter business decisions
• Solutions that grow alongside your evolving needs

With Vozo RCM service, you can reduce the headaches associated with revenue cycle management and focus on what matters the most – quality patient healthcare delivery.

“Partner with Vozo RCM Service and unlock the full potential of your healthcare practice and maximize its revenue”.