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Successful contracting depends on optimal retail pricing.

R L Shaul1, R P Hamilton

  • 1Preferred Medical Marketing Corporation, Charlotte, NC, USA.

Healthcare Financial Management : Journal of the Healthcare Financial Management Association
|May 29, 1999
PubMed
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Healthcare organizations must analyze retail price structures to negotiate managed care contracts effectively. Understanding charge variance ensures competitive pricing against market norms for successful payer negotiations.

Area of Science:

  • Health Services Research
  • Healthcare Management
  • Health Economics

Background:

  • Retail price structures are integral to managed care contracting.
  • Payers utilize charge norms for hospital comparison and negotiation target setting.
  • Competitive pricing is essential for healthcare organizations to secure favorable contracts.

Purpose of the Study:

  • To highlight the importance of analyzing retail price structures in managed care contracting.
  • To guide healthcare organizations in determining competitive retail prices.
  • To enable effective negotiation of managed care contracts and offer appropriate discounts.

Main Methods:

  • Measuring the variance of a healthcare organization's charge structure against market norms.
  • Analyzing local and national charge data for benchmarking.

Related Experiment Videos

  • Assessing competitive positioning within the healthcare market.

    • Main Results:

    • Organizations can ensure their retail prices are competitive by measuring charge structure variance.
    • Understanding market variance aids in setting realistic negotiation targets.
    • Informed pricing strategies facilitate successful managed care contract negotiations.

    Conclusions:

    • Analyzing retail price structures is crucial for healthcare organizations.
    • Competitive pricing, informed by market analysis, is key to successful managed care contracting.
    • Understanding charge variance empowers organizations to negotiate effectively with payers.