Managed Care Contracts
Managed care is a health care delivery system organized to manage cost, utilization, and quality. Every healthcare provider must settle on a managed care contract between itself and the payer.
According to Findlaw.com, the contract between a clinical laboratory or other health care professional and a managed care organization (MCO) such as a provider-sponsored network, integrated delivery system, health maintenance organization, or other health care plan, is the fundamental document which frames, defines and governs their relationship. Contractual provisions can affect payment, office organization, practices and procedures, and confidential records as well as clinical decision-making.
Findlaw states, “A good managed care contract, like any other form of business agreement, is clear, consistent, comprehensive, and concise. It will conform to both the intent of the parties, setting out their respective rights and responsibilities, and the requirements of state and federal law.”
For example, Medicaid managed care provides for the delivery of Medicaid health benefits and additional services through contracted arrangements between state Medicaid agencies and managed care organizations (MCOs) that accept a set per member per month (capitation) payment for these services.
Depending on the market share of the health plan and the services offered by the healthcare provider, the negotiability of the contract will vary. Well-established managed care plans that have a large market share typical use form contracts. Newer managed care plans that have little market share and want broad provider participation are generally more willing to negotiate terms.
The Patient Protection and Affordable Care Act and the move toward accountable care has put a much greater emphasis on quality measures than in previous years.
Healthcare providers must prove in contract negotiations how well they manage quality and cost; such proof is usually provided with a comprehensive set of quality measures reported directly from the electronic health record (EHR). This can be straightforward for a single practice using the basic reporting functionality of its EHR, a more complex managed care plan might require features that an EHR vendor doesn’t offer.
FL Medicaid Gives Up On Statewide Lab Contract
CEO SUMMARY: With the withdrawal of the December 13, 2004 “Invitation to Negotiate” (ITN), Florida’s Medicaid bureaucrats seem to have thrown in the towel—at least for the moment—on the effort to give a single laboratory company an exclusive three-year contract to provide labora…
Florida Medicaid Contract Is On-Again, Off-Again
CEO SUMMARY: Start with a flawed idea: Medicaid lab testing costs in Florida can be cut by awarding an exclusive statewide contract to one laboratory company. Compound that bad idea by designing a contract awards process that guarantees the state will pay twice for a number of tests while…
CA, FL, BC Move Forward With Lab Test Contracts
CEO SUMMARY: Medicaid agencies in the bellwether states of California and Florida continue to push ahead with plans to revise laboratory test contract policies. In British Columbia, private laboratory companies face an uncertain future as the provincial health administration maneuvers to …
California Medicaid Prepares To Issue Lab Contracts
CEO SUMMARY: California Medi-Cal officials may be creating more problems than they solve with their latest scheme to have independent laboratories sign contracts with their Medicaid program—while excluding hospital laboratory outreach programs and labs operated from physicians’ clinic…
Lab Contracting Fracas In British Columbia
CEO SUMMARY: Government healthcare officials in British Columbia are taking definitive steps to recast the existing status quo between private commercial laboratory companies and public (government) hospital laboratories in the province. Although the stated goals are to reduce the cost of…
FL Medicaid Lab Bid Gets Slammed By Foes
CEO SUMMARY: Florida laboratories were caught by surprise last month when state Medicaid officials announced a 28-day process to award one lab with the state’s non-hospital Medicaid testing. To fight this RFP, a growing coalition of laboratories, lab industry trade groups, and the Flori…
Florida Issues State RFP For Sole Medicaid Lab
CEO SUMMARY: If competitive bidding for Medicare business is something universally viewed as bad by the laboratory industry, then the lab services RFP issued by Florida’s Medicaid program must be considered a serious threat to the status quo. Further, the fact that Medicaid officials in…
Michigan Lab Network Wins Major HMO Deal
CEO SUMMARY: By winning the contract for Health Alliance Plan (HAP), Joint Venture Hospital Laboratories (JVHL) captured another major exclusive managed care contract for lab testing services in Southeast Michigan. Its victory demonstrates that local hospital lab outreach programs can com…
Connecticut Hospital Labs Win HMO Test Contracts
CEO SUMMARY: Connecticut Hospital Laboratory Network, LLC was formed in 1996 with the specific goal of winning managed care lab testing contracts. During the past five years it has steadily increased the number of patients covered by such contracts. Along the way, it has learned important…
UnitedHealth Using Lab Data To Improve Health Outcomes
CEO SUMMARY: Managed Care is shifting into a new operational model that places prime emphasis on using clinical information to drive improvements in the quality of healthcare. At UnitedHealth Group, one of the nation’s largest health insurers, early efforts to analyze clinical data have…
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Volume XXXII, No. 6 – April 21, 2025
Now that a federal judge has vacated the FDA’s LDT rule, The Dark Report analyzes the judgement and notes the various steps the FDA could take in response. Also, lab testing at pharmacies is proving to be less successful than was once anticipated.
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