HMO contracting strategies: protecting the provider's interests

Managers of provider organizations who understand HMOs' motivations and negotiating strategies will be better prepared to negotiate contracts that serve the interests of their organizations. Information that may strengthen a provider's negotiating position with an HMO, such as the HMO's historic and projected general administrative costs, inflation factors, and utilization rates, can be obtained from the proposed premium rates HMOs must file with their state departments of insurance or from HMO annual statements. Providers also should make sure that their contracts give them the right to regularly review the HMO's database of information relating to the provider's costs and revenues. Without this information, the roots of problems may be obscured, leaving providers with no opportunities to turn around a negative situation.