If medical practices want patients and therefore a cash flow revenue stream, then you are more than likely going to have to participate in managed care plans. However, when dealing with managed care, always remember these key points:
- Never sign a managed care contract without carefully review the terms of the contract and its reimbursement rates.
- Always negotiate contract issues you do not like. You never know if you can change the contract unless you try first!
- Constantly monitor financial performance.
- Annually grade your managed care relationships and create an overall hassle factor or grade factor (again, using the sample worksheet above).
- Don’t be scared. If you need to terminate a managed care contract, do so.
- If a decision is made to terminate, make sure both patients and colleagues are notified.
Before any contract is terminated, always make sure that you create a strategy on how any potential revenue lost as a result of the termination will be replaced.