When looking at a Medicare Advantage (MA) contract, the first instinct of many skilled nursing providers will be to check the rates.
But if they stop there, they could miss out on significant amounts of revenue.
“We do know when people get a contract, they want to just look at the rates,” Steve Wermuth, a partner at the health care consulting firm Strategic Health Care, said at LeadingAge’s annual conference and expo in Philadelphia on Wednesday. “But there are other things in that contract.”
These include provisions related to audits, prior authorization, and prompt payment, to name just a few, and providers need to examine all of them in order to maximize their end of MA contracts.
Providers need to act fast
The growth of MA has skyrocketed over the past 10 years, and the length of time it takes to break into managed care networks means that providers can’t wait on moving into the field, Health Management Associates principal Dana McHugh said. Even if they don’t want to participate in MA today, necessarily, providers need to start taking steps now if they think they’ll move in that direction in a few years.
“If you are a small provider and you want to be a player in your market, know that it will take you a minimum of six to 12 months to get a contract, get credentialed and then get into that network,” McHugh said. “Then once you’re on the directory, you have to go and educate your hospitals, and you have to remind them [that you’re in the network], and that may take six months.”
But providers should not feel so pressured by the growth of managed care that they leap into a bad contract, Wermuth warned. He particularly cautioned against entering an “evergreen” contract, since once that’s signed, a provider won’t be able to change any of the terms.
“Don’t get into a contract and say, ‘Well, the terms aren’t all that good, but next year we can go into re-negotiations and the terms will pop up a little bit,'” he said. “Our experience tells us that rarely happens at all.”
‘Words mean something’
Quality is king when trying to pitch managed care networks on why they should accept a SNF into their preferred cohort, and providers have to demonstrate that with data. Medicare Advantage plans have their own star ratings from the Centers for Medicare & Medicaid Services (CMS), and smaller providers can get their foot in the door by showing how they can directly benefit the managed care plan’s bottom line.
But once the contract is in front of them, providers need to focus on what’s going to happen to their revenue. Most contracts will offer various tiers of payments, and it’s crucial to look at what’s included in each level, according to McHugh — who worked in managed care and Medicare Advantage for more than two decades. Sometimes what’s offered by one plan for one numerical level will be more or less inclusive than what other payers offer for the same level, so providers need to check what’s built into the rates and reimbursement for each, she said.
They also need to carefully examine the language of the contract, beyond just the rates, because as Wermuth noted, “words mean something.” Prior authorization parameters, how quickly the plan pays, or the number of audits that a plan can conduct — skilled nursing providers must examine them all, he said.
McHugh also had a very practical tip.
“Make sure you check for ‘lesser of’ language, and make sure it’s removed,” she said. “Let’s say you have a Level I of $250. Sometimes buried in the fine print, a health plan will pay you Level I or lesser of billed charges. So you just want to take out the “lesser of billed charges.” A lot of people don’t even know to do it.”
Other tips for success
The work doesn’t stop once providers get through the negotiation process and sign on the dotted line, however.
“Educate your administrative team so they understand the provisions of the contract,” Wermuth said. “But also educate your clinical staff to make sure they understand the provisions of this contract — and how it affects how services are delivered.”
Many Medicare Advantage payers now have provider manuals and portals on their website, and Wermuth recommended that providers download the documents and familiarize themselves with the portal and the billing procedures.
“To have a claim denied because you didn’t go through their process is something that gets people tied up,” he said. “And that’s on you. Make sure you download that manual and make sure your staff gets educated on that.”
And because that might happen, McHugh stressed that providers should never immediately write off denied claims. To avoid having to appeal because of such a mistake, however, facilities have to understand how payers want codes recorded on the claim form, and this might require billing staff communicating with the health plans.
Payers also have resources available for their providers, and operators need to take advantage: Provider network representatives serve in a kind of customer service role for SNFs, and they can help with education, billing and other issues.
“That person also works hand-in-glove with the case manager,” McHugh said. “The case manager and the provider representative … they really care about what they do. They need you to take their patients. Those are the two people that you really need to figure out who they are.”
Written by Maggie Flynn