8/20/2018 Weird Vague and New Stuff in Provider Payer Agreements - PDF document

8/20/2018 Weird Vague and New Stuff in Provider Payer Agreements 2018 TN MGMA Penny Noyes, President, CE O & Founder Objectives for this session Identify key standard contract provisions and their impact – how to negotiate or manage them Identify some new or less obvious provisions in payer contracts/addenda and their impact & how to negotiate or manage them Overview of value based and bundled payments programs to determine whether you want to be a driver/player in these programs Quick Notes CPT is the registered trademark of the American Medical Association (AMA) Due to Non-Disclosure Agreements the presenter may not always be able to provide contract language examples 1

8/20/2018 Key Standard Contract Provisions • Rate Exhibit • Amendments • Term & Termination • Products • Timely Payment • Timely Submission Less Obvious but Important Provisions • Joint Construction of Agreement • Assignment • Loss of Term w/o Cause • Penalties for Demographics or Use of Non par Providers • Excluded Services • How/When Notice Can be Given • Mergers & Acquisitions/Change of Control Rate E xhibit Does it reflect exactly what you negotiated?  Are all of your codes accounted for with a $ amount? – Based on % or CF of specific year and locality of Mcr – Based on payer’s proprietary schedule  If not, what is the default? - % charges; “gap fill”  If Medicare Advantage is 2% Sequestration applied?  Jcodes –what based on? – ASP + %; AWP +%; Payer Proprietary – How and when updated? Often not stated in contract  If carve-outs – are they in exhibit and do they expire?  If multiyear escalation clause – is it defined and who triggers? 2

8/20/2018 Lesser Of… example and issues Issues… Lesser of… Be sure chargemaster is set Contract Rate high enough above Contract 80%* of billed Rates such that the % BC does not ever apply other than charges (BC) when no value in FS OR Verify State WC/Auto Schedules… 75% *of State  Compare to Contract Rates Schedule for WC  If poor, lessen the % discount considerably and/or Auto  If discounted amount unacceptable, remove product from agreement Sequestration – not a right of MAOs and not always obvious CENTER FOR MEDICARE DATE: May 1, 2013 TO: Medicare Advantage Organizations Reducing Payments to Contracted Providers Section 1854(a)(6)(B)(iii) of the Social Security Act prohibits CMS from interfering in the payment arrangements between MAOs and contract providers. The statute specifies that CMS “may not require any MA organization to…require a particular price structure for payment under such a contract…” Thus, whether and how sequestration might affect an MAO’s payments to its contracted providers are governed by the terms of the contract between the MAO and the provider. Amendments The big “HOWE VE R” 3

8/20/2018 Amendments Regulatory Non-Regulatory Mostly applies to Med Adv Material Negative Impact… Tricare and Medicaid plans who decides? Ask for at least 90 days notice Request Signature of Both w right to object/terminate, Parties , usually answer is assuming regs were known at “no”… so… least 90 days prior to eff date Might need to acquiesce to 90 Ability to term just the affected days notice w 30 days to product object/terminate Might have exposure to State Law re material changes amendment from effective date Unless otherwise herein … of amendment to termination check products and rates date if term notice longer than sections for means to amend amendment notice period these in different manner More Typical Amendment Provisions Except as otherwise indicted herein, No signature Payer retains the right to amend this agreement by making good faith effort to needed to change provide notice to provider at least 90 days rates, add in advance of effective date of amendment. If Provider objects, Provider products, etc. has the right to terminate this agreement with at least 30 days written notice from Failure to the date Provider received notice and object/terminate is Provider’s termination shall take effect 30 days from the date Payer receives the acceptance of the termination notice or on the amendment amendment effective date, whichever is later. If Provider does not send such notice within the designated timeframe, it will constitute acceptance of the Amendment by Provider. Joint Construction of Agreement Parties acknowledge that they had the opportunity to be represented by counsel with respect to the Agreement. Therefore, notwithstanding any otherwise applicable principles of construction or interpretation, the Agreement shall be deemed to have been drafted jointly by the Parties and in the event of any ambiguity, shall not be construed or interpreted against the drafting Party . Ask for it to be removed due to payer’s initial drafting of agreement and unilateral power of Payer to accept or reject requested changes Matters if legal action is necessary in future 4

8/20/2018 Tricare Regions Changed from 3 to 2 Contractors Classic example of “Assignment” E ffective January 1 ,2018 - HealthNet West and Humana Military E ast Prior: UHC West, Humana Military South and HealthNet North Loss of Termination w/ o Cause in Amendendment to Improve Rates 6.2 allowed either party to In exchange for Payer ‘s term without cause anytime agreement to amend the w 90 days notice (sometimes applicable Plan Fee tied to anniversary) Schedule, as additional Loss of this right has no consideration for same, specified time limit… as long Group agrees that it shall not as amendment in place terminate this Agreement or Terminate in future of an attachment thereto without agreement or product cause as set forth in Section requires “cause” 6.2 of the Agreement during No future means to get the term this Amendment is in payer’s attention to effect. renegotiate More Favorable Loss of Term W/ o Cause In exchange for Payer ‘s agreement to amend the applicable Plan Fee Schedule, as additional consideration for same, Group agrees that it shall not terminate this Agreement or any attachment thereto without cause as set forth in Section 8.2 for a period of 12 months following the effective date of this Amendment. 5

8/20/2018 Penalties for Failure to Update Demographics: Use of Non-Network Svcs: Unless prohibited by applicable Payer may, at its sole law, Payer may, at its sole discretion, upon thirty (30) discretion, upon thirty (30) days days prior written notice to prior written notice to Group Group, reduce the rates for reduce rates for Covered Covered Services by twenty Services by ten percent (10%) percent (20%) should for a three (3) month period Provider fail to refer should Provider fail to provide Members to Non -Par timely notice of change in Providers in the absence of: Provider information to Payer as 1) clinical reasons; 2) required and set forth in the advance approval of Payer Agreement, e.g., changes in 3) existence of an notice address, location, staff Emergency Service need; or and demographics. 4) documented Member’s request for referral to an out of network provider … E xclusions : May be category, like lab, DME or Rx, and may be specific to an employer or union plan RECENT RHEUMATOLOGY GROUP LETTER Contract says: Dear Provider If Member’s Benefit The Fund Has recently Program excludes received the above claim certain services or for an injectible that is not limits the Member’s covered under the choice of participating member’s medical providers, such services benefits. This injectible are not considered should be purchased Covered Services under through the member’s this Agreement for such pharmacy benefits. Member Mergers & Acquisitions In the event Group acquires If the acquired entity no or is acquired by, merges longer exists, such with or otherwise becomes provisions have a affiliated with another disconnect, and yet provider that is already under payers hold firm they will contract with Payer, this not add new entity at the Agreement and other entity’s preferred rates and terms agreement will each remain If acquiring, perhaps best in effect and will continue to to terminate acquired apply as they did prior to the entity’s agreement so that acquisition, merger or it is not “already under affiliation unless otherwise contract with payer” agreed to in writing by all parties to such agreements 6

8/20/2018 Favorable Notice Provisions Less Favorable Notice Provision Newsletters, E mail, Twitter, etc… .. Any notice regarding Term and Termination; or to Provider ‘s objection to participation in a Product shall be effective only if given in writing and sent by overnight delivery service with proof of receipt, or by certified mail return receipt requested. All other written notices may be sent by letter, electronic mail or other generally accepted media. Notice addresses are specified on the Signature Sheet to this Agreement Policies and Procedures Manual is part of Agreement 7