Negotiating strategies for capitation

The appropriate strategy to employ in contract negotiations will vary, depending on a number of important factors. These include the relative size and power of the network, the conditions of the local market, the strength of the managed-care payer in the market, and a host of other issues. The negotiating strategy ultimately adopted will be in accordance with the organizations overall preference, style, and needs. In approaching any contract negotiation, two key points should be kept in mind. First, networks must recognize they can become more prepared and empowered for contract negotiations through the acquisition of additional information. Second, form contracts can be changed; nothing is set in stone. Despite the frequent statements of payer organizations that the form cannot be modified to meet the provider's unique desires and needs, in most cases a contract can be modified in one way or another to meet the parties' mutual needs and desires. Everything is negotiable: Any party involved in such negotiations should be positive, avoiding conflict; use a problem-solving approach; agree whenever possible--strive to become "we"; acknowledge the payer's interest and position, expressing a desire to compromise; and acknowledge the authority and ability of the assigned negotiator. Once the managed-care contract is consummated, the network should attempt to ensure that the parties get maximum value from the agreement. One step to achieving such a desired end is to identify a leader who will be responsible for overseeing contract implementation and performance and responsible for knowing the requirements of the agreement inside out and for focusing on all other requirements of the managed-care program.