Credentialing and Contracting With Insurance Company and Payors: Tips and Tricks

As a private practice owner, you are running a small business, and one of the most important things you need to do to keep the lights on is ensure that you get paid - and paid fairly - for what you do. This is why credentialing and contracting with insurance company and payors is one of the first things you need to do when starting a private practice. Unfortunately, this process can be both frustrating and confusing, and many physicians feel as though they have no control over what rates that they get. Navigating the process requires persistence and knowing how to pitch yourself and your practice. Below, we’ll cover tried and true tips from our physician community members on how to successfully negotiate credentialing and contracts with insurance companies and other payors.

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10 tips and tricks to help physicians in private practice through the insurance credentialing and contracting processes

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What is insurance contracting with payors?

In order to get paid by insurance companies or other payors for the work you do on their customers (your patients), you need to have a contract with them that dictates how they will pay you for services rendered.

The contract includes a few key pieces of information:

When the contract between yourself and the payor starts
The length of the contract, and when the renewal process will take place
How and where to submit claims, including the timeframe in which you must file them (filing limits)
Fee schedule, which delineates the contracted rates per CPT code that the insurance company has agreed to pay for your services

Different specialties and practice environments will likely receive different terms and rates; for example, a specialist may have different terms than a primary care physician, and a private practice may receive different terms than a hospital system despite being the same specialty.

You’ll want to keep careful records of all communications and the agreed upon rates, both electronically and physically, and you and your practice management team will want to stay on top of all deadlines for renewals. Additionally, your billing team should have access to all of these things to ensure that they are following appropriate procedures, can cross reference your contracts to make sure that your payments are being made in the right amounts, and that they file in a timely manner.

How is insurance contracting different from credentialing?

While credentialing and contracting are often mentioned in the same sentence and are certainly intertwined, they are different processes. Credentialing with an insurance company involves filling out an application to be included in a payor’s network. It is the first step to working with a payor, and should be thought of as more of an enrollment process where you are registering with the insurance company and proving that you have the training, licenses, and other needed documentation for them to want to work with you.

Credentialing with the insurance company simply allows you to get on to their panel to be in network; that is just the first step and does not ensure payment. The real negotiations happen when the insurance company sends them a contract that outlines the terms of their agreement, which is what we refer to as contracting.

The difference between insurance contracting and credentialing for doctors

Why negotiate your insurance contracts

We’ll start with the obvious. The financial success of your practice depends on you getting paid - and paid fairly - for what you do.

While most physicians fundamentally get this, they may be so eager to get their practices off the ground or be intimidated by the tactics of an insurance company or payor that they take the initial offer.

Remember, the rate that you initially accept will set the baseline for all future negotiations and increases. Starting from a low rate means that even if you get increases in the future, you will still be underpaid relative to what you could have been for every single code going forward. Translate that out to the thousands of claims you submit over the course of your practice, and the financial consequences of accepting even a few dollars less become very substantial.

These consequences extend to the overall viability of your practice, as well as your own satisfaction with your compensation and ultimately, your career and life. You are much more likely to burn out or feel taken advantage of if you aren’t paid a fair rate. You’ll also have to work a lot harder just to make the same money as a colleague or practice that negotiated better rates, which will jeopardize your relationships and your own personal health.

TLDR: Contracts can (and should) be negotiated, although your leverage to negotiate will vary based on the situation. More on that below, but it’s up to you to not just accept whatever is offered to you because you’re so happy that you were offered a contract, and keep pushing for better terms.

Tips and tricks for insurance contracting and credentialing

For the purposes of this article, we’ll assume that you’ve already decided upon the payors that you’d like to contract with based on who the predominant payors in the area are and who have track records and general terms that you are amenable to. We’ll cover in a separate article what to look for when deciding who you want to contract with.

Don’t take no for an answer if there’s a panel you really want to be on and the insurance company says that it is full. One of the ways that insurance companies gain leverage in negotiations with private practices is by limiting access to their panels. If you’ve initially been told no, appeal the decision by asking to talk to superiors or even by reaching out to executives at the insurance companies. Tell them about what you have to offer and how you have been denied a spot on their panel. Be the squeaky wheel, stay persistent (yet professional), and eventually somebody may connect you with the right person to approve your enrollment.
You can negotiate many parts of your contract, not just rates. You can negotiate payment windows, escalation clauses with automatic increases annually, terms of payment to minimize fees, and more.
Aim high. Along the lines of never throwing out the first number that we talk about in our negotiation tips and strategies all physicians should know, don’t reveal all your cards at once. Ask for a rate that is much higher than Medicare/CMS rates. You may be surprised that the number they come back with is higher than the number that you were willing to take. Even if you’re offered a decent rate from the getgo, never accept the first offer. Chances are that number has some room to move. If you don’t ask, you don’t get, so go ahead and try to ask for more.
Always emphasize what sets your practice and skills apart from others on their panel - not just to get onto the panel, but also during contracting. This is what will get you better rates and carveouts, as you want them to want you. An insurance company is a business, and ultimately, they need their customers to be satisfied with the physicians and services they have access to. Your selling point could be that you’re the only reconstructive surgeon in a 40 mile radius, that you offer a specialized service or skillset that only a small percentage of those in your specialty offer, that you do certain cases under insurance that others do cash pay, or even that you speak a language that other physicians in the area do not. You have the ability to offer more personalized services than a hospital, without the facility fees, and in a way that patients will be happier with. Though many of us are uncomfortable with tooting our own horn or marketing ourselves, this is the time to do so.
Read every page of the contract, and look at every code. You never know what will get snuck in there that you’ll have to deal with going forward. As much of a pain as it is to go through a document with potentially over 100 pages, print it out, sit down with a highlighter, and evaluate and compare every term. Make notes about what you want to negotiate, and see how every reimbursement compares with Medicare/CMS rates. Private payors should be paying more than CMS, not less. Make sure that the terms are fair, and understand when and how they can make changes.
Have data when you negotiate with companies. The only way to know if you’re being paid fairly is to understand what others are being reimbursed as well, including hospital systems. In general, hospitals get paid much better for each code because of their leverage in negotiations. We’ve had multiple physicians on our communities actually negotiate better rates for reimbursement because the insurance company wanted leverage against the hospitals in negotiations by saying they could send their patients to a private practice instead. Especially if you're in a rural area and one of the few practices in town, this could work to your advantage.
In addition to staying professional and cordial, develop a relationship with the person that you’re negotiating the contract with. While it’s obvious that you should stay professional in contract negotiations, like most things in life, having a personable relationship will render you more likely to get what you want. Stay in contact with them even after the contracting process has ended, because coming into the next negotiation cycle will be a lot easier if you’re friendly. Think twice before spouting off an angry email, and stay calm and collected in all interactions, as one horrible interaction can lose you all the traction you worked so hard to build.
Don’t take a lower rate, even if it means walking away, because it will set the bar for what other payors will offer you. As it’s possible for payors to know what you are getting paid by others that you’re enrolled with, this will hurt you in negotiations. Essentially, you are signalling to every company what the lowest number you’re willing to take is before you walk away every time you accept a contract. Even if it means you may not reach an agreement with that payor, it’s better to have better rates with fewer payors than horrible rates with every payor, so know your worth, and stick up for it.
Be persistent, and prepare yourself for the long game. Even if you have to walk away from the table at some point to prove your point, come back to the table once you’ve secured other contracts and try again. Eventually most people will get contracts if they continue to check in. If something changes about your practice or its popularity, or if you acquire a new skillset, go back to the company and use that to try and get the higher rate that you wanted. It can take months or even years to get the right contract, and chances are there will always be new aspects that you are negotiating as insurance companies try to get away with more.
Enforce the contracts. This is a deep enough topic to warrant another article, but the TLDR is that getting better rates means nothing if you don’t actually enforce them. Make sure that your billing team reconciles the payments with your contracts and follows up with the payor if they aren’t following your negotiated terms.

Conclusion

There are many ways to increase your private practice revenue, but the fundamental one is making sure that your contracts with payors are solid. When you start a private practice, focus on securing strong contracts that will set you up for financial success, as well as personal and professional satisfaction. You’ll need to be persistent in getting the right terms, but remember that this is a long game that can be won by advocating fiercely for yourself, marketing your skills and what you offer your patients, and being diligent in both your research and your reading of the contracts. Lastly, once you’ve spent so much time negotiating these contracts, don’t forget to enforce the contracts.

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