When was your last career contract review? Last year, three years ago?
Independent physicians and practice managers often sign contracts and quickly file them away. By the time you realize a contract hurts your practice, it’s usually too late.
Why This Matters Now
Healthcare contracts change. Reimbursement models shift, regulations evolve, and payer policies update.
What appeared to be a fair agreement in 2019 may be costing your practice in 2025. Independent medical practices can find lower reimbursement rates for standard procedures in previous contracts compared to the current market.
Outdated credentialing or billing clauses slow your workflow and frustrate staff and patients. Evolving regulations increase the risk of penalties and unforeseen compliance costs.
If you’re not reviewing contracts, you risk your bottom line.
The Red Flags You Can’t Ignore
When you review contracts, watch for these hidden traps that can cause serious harm:
- Vague or outdated reimbursement language – Are rates tied to current Medicare benchmarks, or at an older fee schedule?
- Automatic renewals without renegotiation – Many contracts roll over year after year, locking in unfavorable terms.
- Stacked termination clauses – Some agreements allow carriers a 30-day termination notice while providers have a 90–120-day termination notice, creating a significant imbalance in the partnership.
- Shifting administrative responsibilities – Who handles prior authorizations, claim denials, or appeals? Ambiguity here means finger-pointing later.
- Out-of-date regulatory references – A contract still references laws or codes that have since changed, creating severe potential compliance headaches.
Best Practices for Staying Ahead
You can protect your organization from any or all of these issues with a few proactive steps:
- Create a review calendar to conduct annual or semi-annual contract reviews, allowing you to identify potential issues before they become unexpected problems.
- Engage experts, such as healthcare attorneys and consultants, to identify issues quickly that busy practice managers or physicians might miss.
- Compare reimbursement rates against benchmarks to identify any that are no longer competitive with what others in your region or specialty receive.
- Track every amendment. Maintain a single, organized record to prevent confusion, resolve disputes, and quickly locate contract updates.
- Renegotiate contracts before auto-renewals trap you in unfavorable terms. Flag key dates to start talks early.
Real-World Examples
A cardiology group’s last carrier contract review was five years ago. One day, the new practice manager sees the contract in a file and notices that the basis of carrier reimbursements is the 2016 Medicare rates.
The result is a practice loss of hundreds of thousands of dollars in revenue since 2016, a loss that could be prevented by a simple contract review and renegotiation. Another example is the surge in demand for telehealth during the COVID-19 pandemic.
Most contracts then ignored telehealth. Vague terms caused disputes between practices and carriers. Patients were confused. Managers were frustrated.
A contract review exposes these problems. You can then initiate discussions with carriers to establish rates and streamline operations, thereby avoiding unnecessary friction.
Whether running a solo practice or managing a large group, ignoring contracts until a problem arises is a costly mistake. Review and update agreements regularly to avoid expensive complications.
Patient Care IPA (PCH) can assist with our team of carrier contract negotiators, who meet with you and your team to identify contract issues and initiate the renegotiation process. Our team will streamline healthcare contracts and identify potential red flags to enhance compliance and ensure seamless operations.
The PCH team works to secure your practice on terms that protect your revenue and operations, as you’re part of our larger PCH team.
Partner with PCH to manage contract risks and strengthen your practice. Let us handle contracts while you focus on patient care. Contact us today.
Phone: (866) 985-2010, Monday-Friday 9 a.m. – 5 p.m. CT
Email: info@patientcarehealth.com
Website: https://patientcarehealth.com/contact-us/
Learn how PCH reviews healthcare contracts for the benefit of independent practices and insurance carriers alike!
