Watch out for these managed care clauses

When reviewing your managed care contracts, pay attention to these clauses:

Gag clauses  Prohibits you from discussing patient treatament options that the insurer does not offer. You can lose money if your physician practice offers these services.

Favored nation clause  This requires you to always offer the payer the best price (i.e. the lowest reimbursement rate) that you have with any other payer.

Indemnification/hold harmless  These clauses requires you to indemnify or cover the payer under all circumstances. In other words, the payer is transfering all of the risk to your medical practice.

Termination clause  Pay attention on how a payer can terminate you, not just on how much notice has to be given to terminate. Keep the contract fair by making sure the payer is bound by the same termination requirements that you the provider are.

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.