Which contracts does this apply to?
This guide concerns commercial agreements for independent professional medical practices. Medicare and Medicaid payment schedules, hospital facility contracts and value-based arrangements require different analysis. Identify the plan product and network rather than treating every agreement with a payer brand as interchangeable.
NPAG screens commercial contracts more than five years old for renegotiation eligibility. Age is a reason to review, not a substitute for the agreement’s renewal, notice and amendment provisions. A payer is not required to agree to a higher fee schedule simply because a contract is old.
1. Establish what your contract actually pays
Collect the executed agreement, rate exhibits and later amendments. Confirm the effective date and whether the schedule uses fixed dollar amounts or a percentage of a specified Medicare year. An unsigned proposal is not the current contract.
Use deidentified payment summaries to check whether claims are being allowed at the contracted rate. Separate low fee schedules from denials, modifier adjustments and patient collections; a negotiation request will not necessarily resolve a payment-processing error.
- Agreement, amendments, fee schedule and incorporated payment policies.
- Commercial payer and product, provider identifiers and service setting.
- Highest-volume codes, annual units and current allowed amounts.
- Renewal dates, notice deadlines and the payer’s contract contact.
2. Compare like-for-like rates
A useful comparison matches code, modifier, locality, date, payer product and professional or facility setting. Medicare can be a reference, but it is not a commercial offer. Hospital prices and national averages should not be presented as an independent office’s attainable rate.
NPAG’s online tools currently show national commercial references for supported codes. They do not establish verified local payer rates. A practice-specific request needs its own source verification; missing benchmark codes should remain explicitly unbenchmarked.
3. Choose a focused, defensible request
Prioritize services that matter to your actual payer and code mix. A large percentage gap on a rarely used code may be less important than a smaller gap on a frequent visit. State what you want changed, why the comparison is relevant and which effective date you are requesting.
Keep practice-access or service-quality statements factual and documented. Do not invent network shortages, threaten termination without evaluating the consequences, or share another practice’s confidential agreement. Seek qualified legal advice for termination rights or collective negotiation arrangements.
4. Submit and track the payer response
Follow the agreement’s required communication method and notice periods. Retain the request, supporting exhibits and written responses. The payer may ask for clarification, counteroffer or decline; neither submitting a request nor buying an analysis assures a result.
Review a proposed amendment as a whole. A higher headline percentage can be offset by a changed Medicare base year, product scope, payment policy or other provision. Confirm the actual codes and terms before signing.
5. Verify the amended schedule and actual payments
Keep the signed amendment, implementation date and revised code-level schedule. Then compare appropriately deidentified allowed amounts after the effective date. Separate a payer-agreed rate change from realized collections, and investigate implementation errors through the appropriate process.
If the evidence is weak, the schedule is already competitive or the timing is unsuitable, the right next step may be to verify rates or wait—not to launch a broad negotiation. A contract review should make those limits visible.
Sources and further reading
- CMS Physician Fee Schedule documentation
Government fee-schedule reference and lookup context.
- CMS Transparency in Coverage guidance (PDF)
Public negotiated-rate disclosure guidance; not proof of an attainable practice rate.
- AMA payor contracting checklist (PDF)
Additional contract-review questions. Access may be restricted by the publisher.
Public sources support the general explanations, not any NPAG outcome claim. Practice examples are illustrative unless supported by approved records. This guide is not legal advice.