For dietitians, accepting insurance provides a way to drive new clients and build a successful practice. However, growing a profitable insurance-based practice, depends on receiving fair reimbursement for your nutrition services. These rates are established in the provider-payer contract, and are often signed by dietitians without fully knowing the terms or rates. It is crucial to get the most out of insurance contracts— and to do that, you’ve got to negotiate.
In this article, we’re covering what you need to know to understand insurance contract negotiations as a nutrition professional from signing your first contract to renegotiating terms down the road. Learn how you can expertly make a case justifying a higher reimbursement rate, while maintaining a friendly relationship with insurance carriers and representatives.
For New Insurance Providers: What’s a Contract Rate?
A contracted rate refers to the amount that an insurance payer agrees you should be reimbursed for your nutrition counseling services. This is also known as a negotiated rate, an allowed amount, or an agreed upon amount.
When you join an insurance panel for the first time, you’ll go through a process that is called credentialing. Credentialing is a process that your clients’ insurance companies use to verify your education and professional experience to ensure you meet the requirements(?) for acting as a registered dietitian. It is during this process that your contracted rate is determined.
If you’re a new provider, learn how to properly become credentialed with Healthie, an all-in-one practice management platform that provides understanding to insurance, credentialing, and billing designed for dietitians. These are all vital steps in becoming a successful and educated wellness professional. Download Healthie’s step-by-step guide to walk you through the credentialing and contracting process, so you are prepared in communicating with insurance companies.
Why Negotiate Your Contract Rate with Insurance Payers
In an insurance-based practice, negotiation is a common technique that is utilized by many clinicians throughout their career, especially in the beginning of their business.
To get your money’s worth for your services, you’ll want to ensure your rates are properly looked over and possibly negotiated before signing anything. Even negotiating $1 additional per 15 minutes can translate into thousands of dollars in additional income at the end of the year. Contract rates can be negotiated down the line, and typically dietitians will ask to renegotiate rates every 1-2 years, similar to asking for a “price of living” raise from an employer.
Although the process of contract negotiation can be daunting, you’re not alone. It can take a considerable amount of time to make conclusions with the insurance providers. Settle these terms before booking and having sessions with clients so you are reimbursed and paid on time.
Contracted rates vary between payers. Some of the factors that the payers consider when determining what they’re going to offer you as a contracted rate are:
- Number of years in practice
- Geographic location
- Level of Education
- Area(s) of expertise/specialties– including additional certificates
Negotiating Your Contract Rate: What to Bring to the Table
The first step in negotiating your contract rates is to assemble a list of important information about you, and your business. You want to showcase the value of your services, among your clients and within the industry. Even more, you want to differentiate yourself from other providers. As a dietitian, you provide valuable and often specialized care to the patients within that insurance panel. The key to contract negotiations, is to highlight why you are a valuable asset to that insurance provider.
Run through the checklist below and compile as much, and as many, resources that demonstrate your value, including:
- Specializations – this can be with kids, elders, young adults, etc. Serving people with autism? Diabetes specialization?
- Training – Do you have extra certification that proves your(?)
- Multiple languages
- Patient satisfaction
- Any affiliations with hospitals, clinics or other professional organizations?
When to Ask the Insurance Payer if Your Contract Rate is Negotiable
During the credentialing process with an insurance company, the insurance provider will send a contract to sign. Contracts do not always explicitly show the reimbursement rate, this is the amount that you’re agreeing to receive. This information will be listed on the fee schedule, and you will have to directly ask for it. In some cases, the fee schedule will not list nutritionally-relevant codes, or the common ICD-10 codes that you will bill for. If this is the case, then you can ask specifically what the reimbursement for your top billing codes are.
97802 – medical nutrition therapy; initial assessment and intervention, individual, face-to-face with the patient; each 15 minutes
97803 – medical nutrition therapy; re-assessment and intervention, individual, face-to-face with the patient; each 15 minutes
97804 – medical nutrition therapy; group (2 or more individuals); each 30 minutes
View a more comprehensive list of CPT codes, and learn more about fee schedules here.
It can get confusing, yet it is crucial that you’re on top of your fee schedule and know all of the billing codes so you’re properly compensated on time for your services. Based on your fee schedule, you can determine if your contract rate is negotiable. However, there is no limit for the number of times you request an increase in pay, or better reimbursement rates. Don’t ask unless you are sure that you are entitled to better rates. So ask your insurance payers when you find it to be realistic and appropriate.
Yes, your main objective is to run a successful nutrition practice while maintaining a strong client base. You want to expand your services to reach more clients, but in doing so you might have to up your game, so when the first request comes by, you will be able to really catch the insurance payers eye.
How Often to Check Back and Ask to Re-evaluate Your Contract Rate
Sometimes, you need to reevaluate your business to ensure that what you’re doing is getting you closer to where you want to be in terms of your contracted rates. With that in mind, the same way that employees expect to be given a raise from their employer when their performance improves, they’re exceeding expectations, or keeping up with inflation. Clinicians should expect the same from insurance payers. There are some payers that have a “take it or leave it” attitude regarding rates, but usually there is some room for negotiation. This again depends on the factors that YOU bring to the table when it comes to specialization, certifications, and other factors that make you stand out against your competitors.
You may want to put together a statement, or letter, outlining your request to apply for increased reimbursement rates based on your expertise and value. It’s best to keep a friendly, professional tone throughout this process, including your letter.
- How long you’ve been contracted with that panel
- The number of patients you see on a regular basis from that panel as well (hint: the higher, the better)
- Updates to your specialization, credentials, skills, and training
- Discuss any plans for continued education and new services provided
- Are there a limited number of other insurance-based dietitians in your area? If so, you’re providing a valuable service to the community and expanding the insurance company’s reach in nutritional care
- Data on patient care, satisfaction and improvements — you may want to survey your clients along the way to collect valuable data about their satisfaction with your care. Depending on your patient population, you can also keep data demonstrating client success and improved health markers (ie. lowering a1C rates in Diabetic patients, decreasing cholesterol or BP levels, weight loss, etc). It’s hard for insurance companies to argue with valuable data that you’re able to provide
There is also benefit to highlighting the ways you are a valued member of your insurance providers’ networks, and any way that you help to save them time and money.
- Verify benefits online whenever possible
- Bill electronically and use an EHR platform (the insurance company benefits from this, and does not invest in your EHR platform)
- Get EOBs electronically
- Get paid via EFT
Lastly, describe any increases to your business expenses that further justifies your need for higher reimbursement rates:
- Increases in cost of living
- Reimbursement rates from other insurance providers that you are credentialed with that are more competitive
- Medicare reimbursement rates (are they at least matching 100% of medicare rates?)
- Increases in your rent, office expenses, staffing
- Increases in your liability insurance premiums
There are generally no rules established regarding when and how often to request reimbursement increases. You can check the terms and the expiration of each of your existing contracts. Many insurance contracts are “evergreen,” meaning they’ll automatically renew unless one party explicitly requests a change to the agreement. Knowing when your contract expires can give you an idea of when you should begin the negotiating process, keeping in mind that it will take many months. Review the contract to determine how much notice is needed to make rate adjustments before the expiration date. Negotiating your rate isn’t hard per-se, but it will take many months to reach an agreement.
For best practices, it may be better worth your time when you’ve made some notable developments in your professional development. If you have no new certifications, credentials or training to speak-to, it may be better to strategically wait until that time comes. You essentially have to “state your case,” when requesting a rate increase, so do this at a time when you are confident you can justify your request.
Remember, you cannot simply approach an insurance payer and ask for an increase. Instead, your practice needs to come to the negotiating table with numbers and supportive arguments for why that increase is applicable for your practice. Without evidence suggesting a raise can be negotiated with the provider, there is less of a chance that you will reach an agreement that makes both parties happy.
Ask for an X% raise, effective immediately, in these codes:
- List the ICD-10 codes that you typically bill for currently with the insurance provider with the current and proposed new rates.
Reminder on rates: you can not share your contract rates with another provider.
Start with requesting a 5% increase. For a 5% increase, multiply your contracted rate for each CPT code by “1.05”.
MGMA (Medical Group Management Association) recommends requesting a 2 to 3 % increase in rates annually instead of a 10% increase at once, for instance.
Who to speak to regarding your contract rate:
The last step in this process is to reach out to your panel and apply. Call the provider relations department for the payer. This will be the same point of contact that you used to apply to join the panel in the first place. If you’re not sure, these numbers are usually easy to find by simply searching the name of the payer with “provider relations.” If you can’t find it that way, start by calling the number on the back of your client’s ID card.
Always ask for full names and for reference numbers from anyone that you speak with. They will guide you in the process of submitting your request. You can expect that many payers will only accept these requests by fax or mail. If that’s the case, make sure to ask the representative how long it should take before they will process your request. Set a reminder for yourself to follow up within that time frame.
You may be asked to follow-up with an interview. This is an opportunity to establish a professional and positive tone for your request. Demonstrate the time and money that you’ve put into your professional development, and how that translates into your request for an increase in your contract rates.
Final steps to take in contract negotiating:
You may receive a no, or an extremely low offer. Be kind, but persistent and follow-up with a counter-offer. Even a small increase in rates will add up to significant amounts annually.
The signing of a contract does not always mean that this message was conveyed to claims.
Make sure you know the effective date of your rate change so that you can address this if needed.
If your insurance representative was instrumental and supportive during the process, it pays to explicitly send a thank you. Even if the process was a tough one, with a back-and-forth in negotiations, you can still thank them for their time. Below are a few examples of what you can say in your thank you email:
- Be specific about the way that he/she helped you (minus the raise amount), saying they were “tough but fair.”
- Ask if you can copy his/her bosses.
- Don’t forget to explicitly state that you will not be sharing your rates with those outside your clinic.
Nevertheless, dietitians have tough decisions to make when opening up their private practice. With many options, it can be intimidating to pick an approach that works best for your practice. After determining whether or not your wellness practice takes insurance, it is crucial to learn how to from their to get the best long-term benefits for your nutrition services. Understanding how to effectively negotiate insurance contract rates with payers is only the first step in becoming a more informed practitioner in the wellness industry.
Whether you’re signing your first contract or renegotiating your contract down the road, you want to ensure you’re in the best possible situation so you have a better chance in negotiating reimbursement rates with your payers.
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