Blog Post

Navigating Payer Relationships

Navigating Payer Relationships Web

Becker’s Healthcare has reported that 78% of hospitals say their relationships with payers are getting worse. ECG partner Ken Steele is surprised that number isn’t even higher.

“There are very strong differences of opinion,” Steele says of the dynamic between health plans and providers. “Payers are talking about keeping healthcare costs down. At the same time, healthcare costs are rising rapidly, because of the pandemic, shortages of labor, supplies, etc.”

“The only word that comes to mind is ‘contentious’,” adds Joe Mangrum, a principal with ECG. “More and more, payers are willing to terminate relationships pretty early on in the negotiations, even with larger provider groups.”

Ken and Joe both work in ECG’s Managed Care Services division. Ken helps hospitals and health systems improve their contract reimbursement rates. Joe is the leader of ECG’s payer practice, and he advises health plans on strategy and contracting. That may sometimes put the two consultants on opposite sides of the table, but there’s one thing they agree on: the tense relationship between payers and providers is unlikely to change anytime soon.

Ken and Joe recently appeared on the Becker’s Healthcare podcast. Hear their thoughts on the current state of the payer/provider relationship, what’s made it so combative, and how the industry can better support the transition to value-based care.

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This podcast was previously recorded on February 28, 2023, for Becker’s Hospital Review.

Edited by: Matt Maslin