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Guerrilla Warfare: More MCO Contracting Survival Tips
By Judith Otto  A "Nightmare on Elm Street" aptly sums up how many
O&P providers feel about managed care contracting. Previous
articles explored "rate shopping" and strategies for opening closed
provider panels. Here, some experts from the front lines describe
more pitfalls and how to survive them.
Any other tricky little surprises you're encountering on the
contracting front lately? Any solutions or advice?
Sheila Press, Esq., MBA, president, Health Care Compliance
Solutions, Scottsdale, Arizona, notes that contracting involves
certain legal terms like "usual and customary," which must be
carefully defined. "In my own contracts, I attach an
‘Addendum A,' identified as a ‘Scope of Work,' so it is
clear exactly what services clients are receiving and paying for,"
she explains.
If contractual obligations are not met, the situation can often
be resolved without dissolving the contract, she adds. Citing an
example, she says, "In one case where terms of payment were defined
as 45 days and payment had not been received after 120 days, I went
to the chief financial officer of the client
company—sometimes the medical director is also an appropriate
source—and advised him that the terms of the contract were
not being met, pointing out that it was not to the advantage of
either of us to end the contract. This has been a productive and
successful approach in gaining resolution."
Cathie Griffith, president of PrimeCare O&P Network,
Ellendale, Tennessee, gives this advice: "Don't sign anything
unless you know exactly what you're signing."
She also offers a word of caution when examining contracts:
"Look for language that describes the Third Party Organization's
(TPO's) procedures with regard to how it ‘re-prices.' The
‘good guys' will use the first contract as the primary
contract and price from that; i.e., if a provider has an existing
contract that reimburses at a higher rate than a subsequent
contract, the first contract takes precedence.
"On the other hand, if they have an existing contract that
reimburses lower than one that is negotiated by PrimeCare or
another entity on their behalf, they must provide a letter stating
that they prefer to be reimbursed at the later contract's rate,"
she continues. "If this language is not in the contract, then the
TPO is free to ‘rate shop' and see which contract reimburses
lower and use that price."
"Try to participate in every contract you can afford to,"
advises Keith Senn, chief operations officer, Center for Orthotic
and Prosthetic Care, Louisville, Kentucky. "Check carefully each
time patients come in—even if you've known them for years and
think you know their coverage. Verify and obtain preauthorizaton in
all cases to make sure." Checking membership cards is the
provider's responsibility, Senn says, adding, "This must not be
overlooked, or you'll definitely suffer for it."
"Even so," he admits, "this process only allows you to flag
problems—it doesn't solve them. But it at least alerts you
before you get into costly trouble by fitting an expensive
prosthesis to someone whose insurance is not likely to pay you. And
you'll be in a position to make an informed decision before it's
too late."
"Insurance companies are in the business to protect themselves,"
points out Alison Cherney, president of Cherney & Associates,
Brentwood, Tennessee. Contracts are usually very one-sided and
designed only to protect the Preferred Provider Organization (PPO),
she notes.
Of providers who complain that they aren't able to identify
patients—don't know who's holding their contract, who's
covered by their contract, and can't keep up when patients don't
come in with a sticker on their card—Cherney says, "They just
need to pay closer attention and stay on top of the administrative
part of their contract."
Be Proactive
"It's about being proactive with your payers," she insists.
Cherney is the part-time chief marketing officer for a
radiation-oncology group which holds 25 managed-care contracts in
Phoenix, Arizona, which is considered one of the most advanced
managed care areas in the US. "Two of the contracts represent 60
percent of our business. And I can tell you that we know every
detail of every contract; and we know what's going on with every
patient who walks through our door We have a dedicated group that
handles this," she continues. "When you get 95 percent of your
business from managed care contracts, you pay attention."
Cherney suspects that most of the complaints about keeping up
with managed care contracts are coming from providers in rural or
less-developed markets: "They're just going through the same
product life cycle in managed care that people in Los Angeles went
through. They probably need to talk to their counterparts in these
more advanced markets and learn what techniques have worked well
for them."
"If you're going to play on the playground," Cherney concludes,
"you've got to play with the other kids, and you've got to pay
attention to the rules of the game."
What's Next?
Inevitably, more issues loom on the managed care horizon. Some
can be anticipated: For example, the Medicare competitive bidding
demonstration programs in Florida and Texas could be expanded if
legislation allows. This promises to be a nightmare if ever there
was one.
No doubt there are other, unanticipated surprises in store as
well.
If, in the final analysis, we seem to be left with more
questions than answers, it's because nobody who can explain and
suggest solutions—i.e., MCOs—is talking. And as Cherney
points out, why should they?
The MCO contracting arena IS still a waking nightmare for most
small O&P businessmen—filled with perils, pitfalls, and
unpleasant surprises for the unwary. If you dare to venture within,
feel free to mix your metaphors and treat it as a jungle: be sure
to take a very sharp machete. Judith Otto is a freelance writer based in Holly Springs, Mississippi. 
Table Of Contents - October 2002
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