Five Tips for Making Physician Contracting More Efficient
MD Ranger subscribers are constructing order out of the complex processes of contract organization, negotiation, and approvals by creating a more structured, efficient, and informed system. Physician contracting and documenting FMV doesn’t have to be an expensive headache.
Here are our top five tips for streamlining your physician contracting process this year.
Make sure your physician contracts are all in one place, organized by expiration date.
When hospitals have dozens of physician contracts that renew throughout the year, keeping organized is critical for successful and timely renegotiations. If your hospital or facility doesn’t have a contract management system that allows for easy retrieval, review, and analysis of physician contracts, consider getting one. This can help to automate the renewal process quickly. Using your contract management system to analyze your data will help you understand the scope of physician services you’re currently paying for, as well as identify potential gaps or duplicative services. MD Ranger provides comprehensive and summary reports and hospital-specific benchmarks to allow you to see contracts and costs across the entire organization.
Prepare for negotiations at least three to six months in advance.
Knowing the timing of negotiations across the year is essential to keeping your physician contracting process running smoothly. If your staff proactively manages upcoming contract renewals, you will have the upper hand in negotiating more advantageous contracts. If you know the scope of payments across your organization in advance, you can prioritize contracts, set budget goals, and conduct informed negotiations.
Empower a member of your staff to manage the process day-to-day, and designate an executive responsible for strategic leadership decisions.
Given the complexities of physician contracting, designating someone on your team to handle data, contract management, and documentation of FMV is a solid investment. Without staff involvement, it is easy for contracts to slip through the cracks, creating a situation that could bring major compliance issues to your organization. While this person might not handle physician contracts full time, she should have access to internal contract data, benchmarks, or market data to support decision-making, a tool to help her view and organize contracts, as well as a process to document FMV and compliance. She should have a reporting relationship with the director or executive responsible for physician contracting at a senior level. Having an executive in charge of all physician contracts who annually reviews costs and renewals will provide greater control over this major cost category. MD Ranger provides the tools and executive reports that make periodic facility-wide reviews simple, as pictured below.
Smaller organizations may designate the CEO or CFO to lead; organizations with more resources may choose to place physician contracting under compliance or legal. Whomever your organization chooses, it is critical that the executive be aware of federal regulations and penalties for non-compliance. They should also oversee the compliance and documentation process. If an audit occurs, an executive will need to be very familiar, comfortable, and confident with the compliance process.
Create or review your physician contracting process.
If you are starting from scratch and want to create a functioning physician contract compliance process, as you assemble your team and your organization’s contracts, define how your organization will determine and document fair market value. Do you employ external consultants? Does your team produce internal FMV documentation? Whatever method your organization decides, document it and stick to a consistent method. If using market data, or a product like MD Ranger, decide when outside help is needed and define those circumstances as best you can. Depending on your resources, there are many methods for lowering FMV costs.
Use market data and tools to quickly segment contracts and document FMV.
The most efficient organizations use high-quality market data to identify market ranges for physician contract rates, saving consultants for complex or unique situations. If you segment your contracts in advance, you can plan and budget for ad hoc FMV while using market data for straightforward agreements. Systems can gain even greater value by setting standards and processes for contract rates. Some benchmark systems, such as MD Ranger, provide contract-specific reports that summarize a specific contract to the appropriate benchmarks for use in review and documentation processes. Do your research, and feel confident that your method will support good decision-making.