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Wrong Fee Schedules and Other Underpayments on Managed Care Contracts Can Cripple Your Practice

Almost all medical providers, big and small, suffer underpayments which they believe are in violation of an existing Managed Care Contract. They read the contract, believe it to be straightforward and dispute the underpayment with the insurance company. The insurance company insists that it is right and your interpretation of the contract is wrong.

There is also the situation where an insurance company is paying your claims with the wrong fee schedule. We have heard of many instances where an insurance company has used an outdated fee schedule. Outdated fee schedules have also been used by insurers when applying UCR rates to out-of-network bills.

An intentional or unintentional misinterpretation of your right to payment contained in a managed care contract can lead to huge losses for your practice. Some medical providers never catch the underpayment and when they do, it may have gone on for months amounting to a big loss in revenue.

Contract interpretation issues should not be ignored. The law often allows you to go back as far as six years to aggregate claims as part of an arbitration or lawsuit alleging breach of a managed care contract. Our article, "Your Managed CAre Contracts Are Gold" discusses how medical providers need to change their mindset and more actively police the revenue stream created by each contract. Depending on your payer mix, your manage care contracts could generate the majority of your revenue. At Phillips & Garcia we challenge insurance company underpayments based on a misinterpretation of a managed care contract and pursue arbitration or litigation for our clients.

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