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How to Respond When Payers Say ‘No’ in Contract Negotiations

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How to Respond When Payers Say ‘No’ in Contract Negotiations

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Contract negotiations

Handling payer contract negotiations is never simple, and one area that many practices find particularly stressful is how to respond when a payer immediately says “no” to the terms you’re interested in pursuing. Although it can be off-putting to deal with an insurer who doesn’t want to work within your required terms, there are ways you can respond to keep moving the needle in your favor.

Check out a few strategies that can help you respond when a payer says no during contract negotiations.

Reframe the Conversation

While some negotiators may immediately walk away after hearing “no,” that’s the wrong response. You should reset your perspective to acknowledge that hearing “no” is not a failure, but is instead just part of the process. In fact, hearing “no” means the negotiation process is just starting — it’s a jumping-off point for you to ask for what you want and need.

Think about “no” being a benchmark that you need to hit along the way to getting a “yes.” When the payer says no, they’re trying to start the momentum, and what your practice must do is avoid halting that momentum before you can reach your goals.

Take Time for Contemplation

When a payer says no, they are giving you the opportunity to slow things down and contemplate the task at hand more carefully. You can think about how to get to the root of the issue while finding ways to work together with the payer so you can create an advocate who will get on your side.

You can think about which questions to ask that will help you better understand potential avenues that will get you to the agreement you’re seeking, and establish a stronger rapport so you’ll be able to use language the payer knows and understands.

Consider Workarounds

Rather than responding to a “no” by asking what you can do to change their mind or arguing your point again, think about workarounds you might be able to pursue.

For instance, if you ask a payer to update the amendment language in your contract and they say no, you might instead ask them to adjust another area, such as the “termination without cause” clause. That way, they don’t have to change the amendment language you don’t like, but you’ve given yourself a way to get out of the contract without cause if necessary.

Offer Choices and Options

Even though it can be challenging to bring up uncomfortable topics, it can help your case tremendously if you touch on the more difficult issues by using negotiation tactics that can help ease the conversation.

For instance, when you’re negotiating it can help to immediately tell the payer that you know you’re asking for a big change, preparing them for you to ask for a significant adjustment. This helps give them room to say no so you can start negotiating down from there.

It’s also helpful to offer choices and options. For instance, if you’re asking for a large rate increase, you might frame it with three possible options:

  • “You could give us this increase over three years if you can’t give it to us in year one…”
  • “We could keep the rates where they are, but take some carve-outs for these 10 specific codes…”
  • “You could give us a blend of different rates from Medicare…”

Even though the end result might be the same no matter which option the payer chooses, you’ve given them creative license and allowed them to feel that they’re in control while sticking to your bottom line.

Ready for your next round of payer contract negotiations? Let expert Doral Jacobsen MBA, FACMPE, help during her latest online training, Negotiate Higher Rates from Payer Managed Care Contracts. Sign up today!


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