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Prepare for Contract Negotiations: Anesthesia Independent Contractor Agreement

To lock down a favorable anesthesia independent contractor agreement, you need to come to the table prepared. Here’s what you should do beforehand:

Want all the details on how to prepare for your contract negotiations?

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1. Look into Your Existing Anesthesia Independent Contractor Agreements

The first step to prepare for contract negotiations is to look at your current contracts so you know where you stand. If you’re signing a new contract because you are in a new location, make sure you take into account how that location impacts healthcare costs and your cost of living. At the bare minimum, your contract should include the following elements:

Service

  • Services provided: The scope of all administrative services clearly outlined.
  • Main contact: This is also often called the “Director of Anesthesia Services” and designates the individual who will be accountable to the facility or payor for the contract.
  • Providers: Explanation of which providers will be completing specific services. Will it be an anesthesiologist, a CRNA, or a combination of the two?
  • Working with other providers: If the contract states that a CRNA must work with another provider or have supervision, those requirements must be outlined.
  • Exclusivity: If applicable for the facility, the contract should address whether your practice has exclusivity in administering anesthesia services or if there will be other providers.
  • Coverage: Your contract should address what type of coverage will be provided. Some options include regular coverage, alternate coverage, weekends, on-call, etc.
  • Term: The period the contract will be valid for. This can vary based on the specific setting, but most contracts last for one year with an option to renew.
  • Termination: The termination clause will vary depending on the contract term, but it is common to have a 90-day termination notice for both parties.
  • Breach: The details of this can vary widely – but both parties should be given a reasonable opportunity to cure any type of contract breach.
  • Loss of privileges: It’s common for provider privileges to be terminated when the contract ends. Your contract should also address situations when a provider loses privileges during the term and if/how the facility can request that they be replaced with another provider.
  • Independent contractor status: Anesthesia providers should always act as independent contractors (unless the agreement states otherwise).
  • Referrals: The contract should specifically state that it is not the intent of the agreement to push patient referrals.

Administrative

  • Financial arrangement: Make sure to specifically address how billing will be handled – whether by the facility or by an outside billing provider. This section may also address any additional payments such as a subsidy for government payors to ensure coverage.
  • Records: Explains how records will be handled, including system requirements and the process for releasing records to third parties.
  • Choice of state/jurisdiction: There should be a clear distinction as to which laws govern the contract and the appropriate jurisdiction where disputes can be brought.
  • Legal fees: Clear outline of who is responsible for paying for legal fees in the event of a dispute. Most agreements state that each party pays their own or that the winning party will have their legal fees paid by the losing party.
  • Terms: The period the contract will be valid for. This can vary based on the specific setting, but most contracts last for one year with an option to renew.

We recommend using your own billing provider. Anesthesia billing is extremely complicated. Most systems aren’t able to optimize anesthesia billing to effectively maximize revenue.

Responsibility

  • Insurance: Addresses who is responsible for handling professional liability insurance.
  • HIPAA/compliance: Make sure that your contract confirms both parties must comply with HIPAA requirements as well as state and federal regulations.
  • Equipment and medications: This provision indicates who is responsible for ensuring equipment is running properly and who must get it fixed if necessary. It may also include information for who is responsible for obtaining medications necessary to provide anesthesia services.
  • Confidentiality: There should be a provision that covers all parties.
  • Indemnification: Should include language that covers both parties.

Make sure all of your contracts address these elements and determine where you want to make changes or negotiate differently.

2. Complete Market Research

Once you have reviewed your current or proposed contract, do some market research to see where you stand compared to your peers. This includes understanding the average take-home and fee schedule for other anesthesia professionals in your area. Make sure your fee schedule at the very least matches local averages. Even better, negotiate to secure above industry averages. Leveraging this data gives you a benchmark to compare your metrics and requests for effective negotiations.

3. Dive into Your Metrics and Data

It’s much easier to negotiate if you have data that highlights how great you are. Make sure to gather information on metrics that factor in total costs and revenue for facilities or how you are providing low-cost, high-quality care for payors. The metrics you gather will be different depending on who you are negotiating with, so make sure you have data that can address their top concerns. We recommend gathering data on:

  • Payor mix
  • Staff efficiency
  • Quality metrics
  • Patient satisfaction survey results
  • Participation in clinical and administrative committees

Insight into your metrics and data provides the leverage you need for effective negotiations.

4. Prepare For Your Anesthesia Independent Contractor Agreement Meeting with a Partner

Going into contract negotiations alone is daunting. Having a partner to support you can be the difference between you signing a favorable contract or a mediocre one.

Your partner can:

  • Provide you with data and metrics to verify your key talking points
  • Help you prepare for the negotiating process
  • Represent your practice at the negotiating table

Being prepared with the right information expands negotiations from a zero-sum game to a mutually beneficial exploration of possibilities.

Get all the details on how to negotiate favorable anesthesia contracts in our eBook.

 

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