4 Ways Payer Contract Analyzer Can Save Your Healthcare Organization Money

As healthcare providers, your costs and charges are always evolving. To avoid losses, negotiating and keeping up with many payer contracts is crucial — but not always easy. The CostFlex team understands these challenges, which is why we have developed our industry leading payer contract analysis software to help providers monitor payer reimbursements and stop leaving money on the table.

CostFlex’s Payer Contract Analyzer (PCA) combines your numerous payer contracts (both commercial and government) into a single software interface. By automating and analyzing the terms of the contracts alongside your costs, it makes every step of provider-payer interaction simpler, more efficient, and more precise.

What Are the Ways Payer Contract Analyzer Can Save Your Healthcare Organization Money?

Our PCA tool is designed to generate data points that give providers an accurate projection of reimbursement according to each of its payer contracts. Let us explain how!

1. CostFlex’s PCA Calculates Your Expected Payment (also known as your allowed amount).

Once our customer-focused turnkey installation is complete, the CostFlex Payer Contract Analyzer:

  • Breaks down every single one of your previously negotiated payer contracts, including government programs (i.e., Medicare)
  • Creates an internal database that compiles and stores the detailed terms of these contracts
  • Uses the charges and costs of a service to determine the allowed reimbursement based on the relevant payer’s established contract

The calculation can be done as a projection or in real-time as services arise. This allows you to see and report the actual contractual amount for every billed patient. With the tight profit margins inherent in healthcare, precision is a major key to profitability.

2. Our Payer Contract Analysis Can Save Your Healthcare Organization Money by Identifying Underpayment…

Being underpaid by payers is one of the most common ways healthcare organizations lose money. There are so many different contracts to oversee that sometimes discrepancies slip through the cracks.

If a contract stipulates that you will receive an extra 15% for a specific service, will anyone notice if the payer only reimburses you 14%? Rather than going through every billing transaction with a fine-toothed comb, PCA will flag it automatically — allowing you to recover your reimbursement quickly at the time of the error.

and overpayment.

In the billing process, overpayments are often seen as inconsequential. The hospital is getting paid more than expected, how could that be a bad thing?

The problem is that unaccounted overpayments may, in fact, end up leading to a loss. If you are overpaid by a government program like Medicare, it’s likely that auditors will discover the disparity. If you haven’t accounted for that money, how will you pay it back (which you are legally obligated to do)?

PCA helps you avoid that scenario by calculating any overpayments at the time they occur, saving you money and a headache.

3. CostFlex’s Payer Contract Analyzer Assesses Contractual Allowances and Adjustments

Without the PCA tool, healthcare providers typically use a combination of historical precedence and conjecture to forecast their potential write-offs. If you received 35% of billed charges from a particular payer the year prior, that doesn’t necessarily mean that you will receive 35% percent this year — even if the contract remains the same.

PCA takes the guesswork out of it. Once payer contracts have been input into the database, you’re able to readily determine your write-offs for any service you provide. Because the agreed-upon contract terms are automated, you can rely on specifics instead of vague percentages. Accuracy — especially when it involves future projections — is a critical factor in mitigating losses and sustaining long-term growth.

4. Payer Contract Analysis Gives Providers a Data Set to Leverage in Contract Negotiations

A hospital’s profitability is directly tied to the payer contracts they’ve signed, and our Payer Contract Analyzer can save your healthcare organization money and gives healthcare providers a bargaining advantage when it comes time to reopen negotiations.

  • Extensive database provides statistics on costs and charges that can be used in negotiations
  • Allows you to account for costs that evolve year over year (such as staffing increases)
  • Option to carry out “what-if” scenarios to evaluate potential margins under varying payer proposals

Whether you’re looking for more favorable contracts or simply need a system to stay organized, CostFlex’s Payer Contract Analyzer can save your healthcare organization money and is the ideal tool to keep you thriving at the top of your healthcare market.

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