Periodic bulletins and newsletters can also change the terms of executed agreements.
Participating agreements between healthcare providers and payers include requirements to comply with the payer’s managed care policies, as outlined in the healthcare provider manual. It sounds simple, but underlying the managed care agreement are key provisions intended to skew the relationship in favor of the payers. Providers must understand the significance and fiscal impact of these four pillars of managed care agreements:
- Failure to follow the terms scrupulously will result in denials.
- The terms are created by the payers.
- The terms can change whenever the payer wants.
- The provider remains bound by the terms.
Note that even after the contract is signed, payers can continue to alter the terms of the provider manual. With just two provisions, the contract binds a healthcare provider to this ever-changing authority:
First, the term is defined. So look in the “definitions” section of the provider services agreement for a term that hints of a provider manual or administrative guide. Often, the term is defined as a “policy,” “procedure,” “protocol,” and “administrative procedure.”
Second, the provider agrees to be bound. The provider services agreement will innocuously state that the provider agrees to “cooperate” or “comply” with these policies and protocols or administrative procedures.
Elsewhere in the contract — perhaps in the definitions section — language will be found indicating that the policies and protocols may change “periodically,” or “from time to time.” What this language really means is that provider manuals can change as often at the payer wishes.
The contract will further state that a provider’s claim for services may be denied if the provider does not “comply” with the protocols and procedures. Look for them in your own contracts, with hints of optional applicability: “Failure to follow payer’s Protocols may result in denial of payment.”
Not so. In reality payers rigorously enforce these seemingly vague terms that are now part of the signed agreement. The provider must adhere to the administrative guidelines and failure to do so will result in a denial.
Notice of these changes will happen by way of an email or mailing. And to the extent that a provider does not dispute the provider manual’s terms (say, within 30 days), it becomes part of the contract.
Unfortunately, the provider manual is drafted and deployed by payers, and neither the healthcare professional nor the medical facility has a say to the language within the provider manual. So as a provider, you need to do three things:
First, stay current with provider manuals, newsletters and even fliers issued by health plans. Make sure you and your staff receive all email and written notices. From the provider’s website, download and save the applicable regional provider manuals and review them promptly. If you have a concern about the new terms, follow the notice provisions of your contract to dispute the new terms. Advise your provider representative, as well, and even in advance. But don’t wait to file a written protest.
Second, you can ensure at the outset that your critical terms are in the signed agreement. Reimbursement rates, appeal rights, opportunities to cure defects in claims and managed care criteria that are harmless or irrelevant to the care rendered should take precedence, and a provider should have an opportunity to correct the error. For example, if no clinical records were received by the health plan, then the provider should have — in the signed agreement — the option to send in medical records for a retrospective clinical review.
Thirdly, make sure the signed provider services agreement explicitly states that any conflict between the provider services agreement and provider manual are resolved in favor of the signed agreement.
It’s a relationship that bears more than passing resemblance to Sampson and Goliath. Still providers can protect themselves by remaining aware of the significance and impact of such “extensions to the contract,” and proactively address them ahead of time, when they are negotiating and executing the initial contract. In each and every instance, the contracts must be reviewed with meticulous attention to detail, especially as they relate to provider manuals and administrative guides. Proactively addressing and protecting your interests at the outset, when the written contract is being negotiated, can prevent costly denials moving forward.
Gustavo Matheus is a member of Anderson & Quinn, LLC, in Rockville, Maryland, representing hospitals, medical practices, nursing homes, and outpatient centers with exceptional legal and denials management services. www.andersonquinn.com.
