How To Negotiate Higher Physician Reimbursement Rates


A lot of people focus more on the medical aspect of running a clinic or practice without considering the business part of operations. However, as a physician, you must also have the knowledge and skills necessary for running a successful trade. It’s one way to be able to get the compensation you deserve for your high-quality service to your patients.

Most of the time, your clients may be represented by large insurance companies who are also just doing business by offering low reimbursement rates. You may have accepted their proposal to get new patients through your doors. Nonetheless, you should try asking for higher fees that will allow you to profit, instead of just breaking even, especially if you’ve provided patients with excellent service.

It can be daunting to think of how to negotiate higher physician reimbursement rates. Fortunately, you can follow these tips to help you get started:

1. Know The Value You Provide

You can’t just approach your payer and ask for an increase. You have to put in the work and prepare a comprehensive report that includes relevant data on why your practice deserves a compensation increase.

The Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis is a strategic planning technique used by businesses to create a concrete blueprint for growth. This strategy entails taking a step back and looking at your practice objectively. It’s better to perform this analysis with your staff to get a comprehensive idea of the things that you’re doing right, as well as your areas of improvement.

Here are ways to determine each factor:

  • Strengths – This aspect pertains to the positive attributes of your clinic. You may have a particular field of expertise that’s rare in your locality or staff that is very accommodating and well-trained.
  • Weaknesses – These factors are on the other side of the spectrum from your strengths. You need to plan on steps to improve these internal weaknesses to stay competitive and keep up with other clinics in your area.
  • Opportunities – While the first two categories refer to internal attributes, opportunities are external factors that have a significant influence on your clinic’s success. For instance, there may be changes in government regulations that might have a positive impact on your practice.
  • Threats – Threats are the external risks that you can’t control. The best way to prepare for these things is to have contingency plans in place in case they occur.

More than highlighting your strengths on your negotiation report to payers, you should also provide numerical data that can quantify factors, like customer satisfaction, quality of service, and other aspects. You can easily do this by collecting information through patient surveys.

2. Check Your Current Contracts

If you’ve been running a practice for quite some time now, it’s highly likely that you’re still getting the same reimbursement rate from years ago. An excellent way to address this issue is to review your current contracts and identify the payers that haven’t sent an updated term of agreement.

You shouldn’t accept the same old reimbursement rate because you have to account for inflation. Make sure that you know the expiry of each contract and how much time you need to send your suggested changes.

3. Calculate For Cost-Of-Living Increase

Another way to negotiate for higher physician reimbursement rates is to highlight the money you spend on cost-of-living alone. This factor encompasses the rent and salaries of your staff, among other operational costs.

It wouldn’t make sense that the payer continues to give the same compensation amount while all your other expenses have surged. At the very least, you can negotiate an increase in cost-of-living, so you must prepare the data before meeting with your payers.

4. Ask Help From Your Lawyer

Lastly, enlist the help of a lawyer to go through all documents that are sent to you. Their services are valuable in explaining the legal jargon in your reimbursement contracts, as well as spotting potential problems that you may encounter in the future, especially with vague wordings. It’s prudent to hire an attorney to assist you in this scenario.


If you’re running a clinic or practice and are having difficulties in keeping up with operational expenses, it may be high time to negotiate for higher reimbursement rates from your payers. You can prepare for this by doing your research and creating a comprehensive report that highlights the value that you provide to patients.

You must also monitor your current contracts to see which arrangements can be modified with a higher fee. At the very least, negotiate for a cost-of-living increase to cover your clinic’s overhead expenses. Moreover, don’t forget to consult your lawyer for every legal document that you send and receive.


Please enter your comment!
Please enter your name here

12 + eight =

This site uses Akismet to reduce spam. Learn how your comment data is processed.