How to Get the Managed Care Rates You Deserve
Negotiating managed care rates is an exercise in futility for most group practices. The managed care organizations have all of the data and are usually unwilling to provide any useful subscriber enrollment data.
The American Society of Anesthesiologists (ASA) is about to change that for the group practices that want to use real data to negotiate their next contract rates. The ASA has recently released the results from their annual Commercial Fee Survey. This survey data gives a group practice the data to negotiate higher rates from commercial payers.
In these increasingly tight economic times, it is vitally important that anesthesia group practices press hard for increases in their commercial and managed care rates to offset the continued reductions in Medicare, Medicaid and Tricare program rates.
Silent PPOs and Rental Networks
Most group practices are losing as much as 5-8% of their their reimbursement through illegal discounts taken by carriers who rents provider networks and agreements. When a physician contracts to join a health network, he or she agrees to accept a discounted rate in return for the network steering patients into his or her practice through a listing in the health plan’s directory. However, this discounted rate has been high-jacked through a deceptive market practice called a “silent PPO” or “rental network.” A silent PPO/rental network is neither insurance nor a health care payment plan offered by a health plan to its clients. Silent PPO/rental networks are not regulated and create a huge obstacle to heath care transparency.
A silent PPO/rental network generally takes no financial risk. The network “shops” around to find the lowest rates a physician has agreed to with any insurer, then “rents” that discounted rate to another entity without the physician’s knowledge or permission. Fourteen states have laws to prohibit these arrangements.
Patients also may suffer financially when the discount applied to their medical treatment is based inappropriately on the lowest contracted rate of a silent PPO/rental network. The patient may have to pay more toward the unpaid balance and incur higher coinsurance.
Silent PPO/rental networks provide no benefit to physician practices or their patients. Physicians may become wary of granting discounts under their existing contracts or are forced to increase their existing contracted rates to offset losses from these unethical manipulations.
Physicians should support legislation that will: 1) regulate how a physician’s contract rate is sold, leased, or shared among health plans, 2) ensure the physician’s right of action against anyone who improperly accesses their price discount and 3) encourage the state Department of Insurance to enforce current state insurance laws to alleviate this deceptive trade practice.
Compliants against a silent PPO or rental network should be filed with the state insurance commissioner’s office.
