H Berryman Edwards, MD, FAPA

ASK DR. DENIAL

August, 1996

Everything You've Always Wanted to Know about Managed Care Contracting but Were Afraid to Ask:

What's the best way to fight managed care?

• Don't sign the contract.

What formula should I use to adjust my normal fee for a managed care contract?

• Increased volume of referrals: Deduct 15%
• My time completing the application: Add 0.5%
• My time reviewing the contract: Add 0.5%
• Fees to attorney to review contract: Add 1.0%
• My time completing treatment reports: Add 5%
• My time for telephone reviews: Add 5%
• My time on hold waiting for telephone reviews: No change. Use this time for completing treatment reports.
• Losses for providing unapproved services for which I have agreed not to bill: Add 5%
• Losses for failure to bill according to the contract: Add 1%
• Increased liability associated with increased pathology: Add 5%
• Increased liability associated with reduced length of treatment: Add 5%
• Increased liability associated with loss of control of psychotherapy to a non-physician: Add 5%
• My insurer doesn't cover me for work performed under contracts with "hold harmless" clauses: Add 5%
• Purchase extra filing cabinets: Add 5%
• They never sent me any patients after all: Tough luck!
• Total (net): Increase your fee by 38%

What formula will the MCO use to determine my fee?

• Increased volume of referrals: Deduct 15%

How does the managed care company determine what they will pay me?

• Supply and demand.

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