Inside the Insurance Contract

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By Erin Cammarata

How often do you review your insurance contracts? Do you know where they are?

Do you know what is outlined in them?

Can you renegotiate the reimbursement?


When I started in O&P over 25 years ago, contracts were managed differently. I distinctly remember an Aetna contract representative traveling to our office and trying, with considerable effort, to get us to become an in-network provider offering O&P services to their members and participating physicians. Ah, the good old days.

We had a nice lunch and good conversation, as I negotiated the payment terms and fees. We dissected that contract to understand the standards to which Aetna was going to hold us and the standards we were going to hold them to.

Fast forward to 2020's completely different landscape. The first thing we do now is check to see if the insurance company is accepting new providers.

Our field has become so saturated that some insurance companies have stopped accepting new providers.

If the network is open, we then put in considerable effort requesting to become a provider. If the insurance company sends a contract, the first thing most of us do is go directly to Attachment A, the fee schedule. We make a quick mental note of common procedure codes and sign the contract. Accordingly, we then call the patients who are members of the new insurance company who have been waiting in the queue for our services, and we go on with our day.

Even though the landscape has changed over the years, we still must manage these contracts, know where they live, and know how to work with them. The contracts outline your filing limits, when you can collect the patient's deductible, and how the insurer will treat an unlisted procedure code.

It might sound ridiculous, but the first thing I recommend is that you locate your insurance/facility contracts. More times than not, providers are not sure where every contract is. Once they are gathered, keep them in one place.

Next, outline each contract's essential points in a user-friendly format that can be referenced by your staff to ensure the standards are being met by both parties. There are three essential details to look for in your contracts.


Prompt payment provisions

The prompt payment provision, outlined in most contracts, defines how long it will take the carrier to process a clean claim. This is similar to the timely filing provision in the contract (the length of time from the date of delivery that the insurer will accept a claim). If the insurance company does not process your claim within the prompt payment time frame, they are obligated to pay you interest on that claim. It is not uncommon for my practice to collect interest on claims that were not paid within the terms of the contract.


Fee schedules

When asked if a fee schedule can be renegotiated, my answer is always the same: You are already at no, so there is nothing to lose. First, you need to know how that fee schedule is structured. Is it a percentage of Medicare rates? Does the fee schedule fluctuate with Medicare rates? Is it a "carved out" fee schedule (charging a different percentage rate for each code)? Is the insurance company holding you to Medicare standards but reimbursing you below Medicare? It is important to fully understand your reimbursement structure and overall performance to know how the payer influences your overall revenue and understand a starting point of renegotiations. Once this information is outlined it is also to your advantage to ensure you are getting paid correctly and update the contract based on this structure. Know your reimbursements; understand and analyze how you are being reimbursed. This information should be used to ensure the amounts accepted and collected from the payer align with the contract terms.


Notice of policy changes

Be sure to be understand how you, the provider, will be notified about contractual changes. Will the insurance company send you written updates in the mail, or will you be responsible for obtaining them from a website? How often do you look for them? If you miss an update or change, you can be blindsided with surprises in the amount or timelines for reimbursement.

We all bill our insurance payers every day. Gather and dissect those contracts and use them as a tool to manage you practice. O&P EDGE


Erin Cammarata is president and owner of CBS Medical Billing and Consulting. She can be contacted at