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Important Guidlines for Medical Practitioners when Contracting with Health Insurance Companies

1 August 2005


Context: In order to maintain a viable medical practice, medical providers must understand the various types of health plans and the way in which these plans negotiate their contracts for medical services provided to their members. Although numerous opinions have unfolded regarding how these contracts should be negotiated, there are common, important points between the various insurance companies that will be discussed. Objective: To provide important information to providers on the key elements of negotiating a contract with health insurance companies. Design: Information on contracting will be obtained through the McMinnville Physicians Organization (MPO) and Dr. Michael Jaczko, President of the MPO. The MPO is located in Carlton, Oregon, and provides its member physicians with a basic format from which to evaluate their provider contracts. Additionally, information will be acquired through a search of the current literature. Results: The American Medical Association as well as state and local professional medical organizations are good resources to use when educating oneself about the different aspects of provider contracting. A common theme among the different organizations is that medical providers must be diligent and alert when negotiating a contract for services with a health plan. Conclusion: Providers cannot be expected to know all of the different health insurance plans. However, medical providers must educate themselves on the nuances of provider contracting with health insurance companies, especially since the terminology and language of most contracts are similar. Increasing their knowledge will not only allow providers to receive appropriate reimbursement for services, but also maintain a clinical practice as deemed suitable.


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