4 steps to ending a payer contract

When evaluating your insurance contracts, the decision whether to drop a payer is just the first part of the process. Once you've determined it's time for the relationship to end, keep in mind these tips from an article published in Medical Economics.

  • Review the participation agreement within your contract, specifically to find out when you are allowed to terminate the contract (which may be only one date per year) and under what circumstances (e.g., Is there a 'termination without cause' provision?).

  • If the payer breached its contract, you are generally allowed to terminate the contract. The downside of relying on this clause, however, is that it may require you to offer the company the opportunity to cure the breach before you terminate, which could lead to protracted battles. The benefit is that this option is not limited to a particular date each year.

  • Determine whether you are allowed--or desire--to terminate your contract with just selected lines of business with the carrier. Also find out whether the health plan is permitted to cancel your contract with its other lines of business in response, and whether your practice can live with that  consequence.

  • Follow the correct termination procedure as provided by the health plan. "Make sure notices are sent to the right contact and address and by the proper method of delivery," Medical Economics noted. "Health plans are notorious sticklers when it suits their own purposes."

To learn more:
- read the article from Medical Economics