RCM Holiday Wishlist: Managed Care Contracts that Safeguard Against Claims Denials

December 21, 2023
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As denials management becomes increasingly complex, optimizing your managed care contracts can be a strategic step in mitigating challenges. Here’s a RCM wishlist of contract provisions that can fortify your position and protect your organization from the nuances of denials:

Right to Appeal:
Clearly define your right to appeal, specifying the number of levels and response time expected from the payer.

Response Time Accountability:
Hold payers accountable by including response time commitments in the contract, ensuring timely resolution of appeals.

Third-Party Reviews:
Incorporate language allowing third-party reviews, such as Independent Review Organizations (IROs), to bring an impartial assessment to disputes.

Arbitration Provision:
If not already present, include arbitration provisions in contracts, specifying the process and conditions for dispute resolution.

Full Payment Before Audit Commencement:
Protect your organization’s cash flow by stipulating that payment must be made in full before an audit commences, preventing financial strain during the auditing process.

AR Threshold Limitations:
Set limitations on audits based on Accounts Receivable (AR) thresholds, preventing excessive tie-up of funds in prolonged audit processes.

Audit Timeframe Clarity:
Clearly define the timeframe for audits, specifying whether it’s from the date of discharge, date of first payment, or processing date.

Detailed Audit Reasoning:
Require payers to provide detailed written notices and reasoning for audits, ensuring transparency and aiding your understanding of the audit purpose.

Itemized Bill Insufficiency Acknowledgment:
Address concerns about audits based solely on itemized bills by including contract language acknowledging the insufficiency of itemized bills for comprehensive charge audits.

Exclusivity for Health Plan Audits:
Restrict audits to be conducted exclusively by the health plan and prohibit third-party companies or vendors from independently initiating audits.

Single Audit Per Claim:
Limit the number of audits per claim, preventing payers from conducting multiple audits for a single claim, ensuring fair and focused review.

Coding Guidelines Agreement:
Define and agree upon the coding guidelines to be used for coding-based denials, such as DRGs, avoiding discrepancies and disputes over coding practices.

While obtaining every item on this wish list might be ambitious, even incorporating a few key provisions into your contracts can significantly enhance your organization’s resilience against denials and streamline the appeals process. Collaborate with your managed care team to initiate discussions and negotiations that align with the specific needs and challenges of your organization. Building stronger contracts can contribute to a more robust denials management strategy, ultimately ensuring financial stability and efficiency.

Discover whether your Managed Care Contracts include provisions that can strengthen your position and safeguard your organization against the intricacies of denials. Request a complimentary assessment now.



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