October 18, 2011
Question:
Hi Jennifer,
I was recently terminated by a third party payor as a participating provider. The termination becomes effective next week. I don’t really want to be part of the network because the reimbursement has decreased so substantially that I’m better off without the plan, but I’m concerned there may be ramifications from the termination. Thoughts?
Thanks,
Dr. E
Answer:
Well, my answer here is of course general since I do not have all of the information, but I will comment that the contractual relationship between a payor and a practitioner is a private contract. One that the termination of should not involve third parties such as other payors or any government body. If the termination were precipitated by actionable conduct, you may potentially be referred to another agency, however, I would imagine you would have an inkling that may be the case – in which case you may want to retain counsel upon contact by any other party. If you are unaware of any reason why the payor would terminate you, my guess would be that your patient population qualifies for actual reimbursement somewhat profitable for you and harming the insurers bottom-line. With the facts as they stand, I wouldn’t lose any sleep over a potential referral to another party. Had you not specified in your overview that you are thankful for the non-par status, I would have commented above that you may want to consider appealing the termination decision, but if you prefer to participate after some time off, you may just be able to reapply for par-status.
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Ramifications of Payor Contract Termination – Relations with Other Payors
Yesterday’s question asked about ramifications of termination from a third party payor. As pointed out by coding, documentation and credentiailing expert Jackie Thelian of Medco Consultants, my answer did not touch upon a very important potential ramifications, which creates potential issues when seeking credentialing or re-credentialing from a third party payor.
Jackie points out that “if a provider is terminated from a plan, when he/she is re-credentialing with other carriers, whether that provider has been terminated by a plan is a question asked.
The physician would then have to honestly answer that he/she was indeed terminated by a plan which may prompt other insurers to take a closer look at the physician and potentially reconsider their contract with the physician.
Also in some cases the physicians contract with the various insurance carriers may include language that requires the physician to report to the other carriers when another insurer terminates the physician’s contract.”
Its important to remember that while those extremely lengthy payor contracts are difficult to read and often non-negotiable, is not an excuse for not understanding what is in your contracts and what your rights are. Signing a contract creates an obligation on your part, one that is legally enforceable. Prior to entering into a contractual arrangement, or leaving a contractual arrangement, you should consult with an attorney. In this situation, the doctor asking the question did dismiss in our conversation the idea of appealing, which was why yesterday’s answer addressed an affirmative action by that insurer to make a referral to another agency -that was the asker’s concern. However, today’s email is to further highlight other potential ramifications you should be aware of.