Decrease contract negotiation length by 40%

Benefits of Modeling

Months saved over total negotiation timeframe

2

Increase in expected reimbursement from payer

$428K

Organization in brief

Memorial Health System, a 214-bed hospital system in Marietta, Ohio, previously used manual processes for contract negotiations that took five months to complete.

A major commercial payer was opening a contract for new negotiation, but delivered the new proposal two months later than expected. The initial proposal included complex reimbursement methodology that had several carveout elements.

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The contracts negotiation director used calculation logic from Payment Integrity Compass to analyze the payer's service terms and build versions of the initial model to incrementally increase reimbursement.

Memorial Health System was able to finalize rates with the payer in just three months and secured an additional 1% rate increase above the initial proposal—amounting to $428,000 in potential annual revenue. The validation reports created greater confidence in the accuracy of results over the manual process.

"PIC was able to accommodate [the] reimbursement terms, therefore I had a high level of confidence during the negotiation...it gave me the ability to tweak our proposals to ensure we were not leaving money on the table."
-Contract Negotiations and Reimbursement Manager

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