Navigating Payer Contracts: Strategies for Oncology Practices in a Shifting Landscape

Sheri Chatterson

In this interview, Sheri Chatterson, vice president of payer relations at OneOncology, discusses effective strategies for negotiating payer contracts, aligning internal teams, and navigating evolving contract language amid increasing complexity in oncology care.

Please state your name, title, and any relevant experience you’d like to share.

Sheri Chatterson: My name is Sheri Chatterson. I serve as the vice president of payer relations for OneOncology. I've worked in health care for about 25 years. I've worked for several different payers, and I've worked for large integrated delivery systems with multiple hospitals and large physician practice organizations as well.

What are the key components of an effective payer contracting strategy in today's health care landscape?

Chatterson: It's important to have modeling to understand your own fee schedule in terms of charges compared to the proposed fee schedule of the payer. It's important to understand the methodology in terms of the payer's fee schedule. Are they offering a custom fee schedule that is specific to the payer? For example, Aetna's market fee schedule may differ from Cigna's market fee schedule.

It's also really important to understand what you want and why you are asking for it. What is the justification? Being able to articulate the story to the payer of why this is an important market is key. Why is the practice important? How do they fit into the overall oncology landscape? Who else is in the market, and how does the practice's market share satisfy the need for oncology visits? That's where I would start.

What early-stage missteps do you most often see in payer contracting, and how can organizations avoid them?

Chatterson: The highest level missteps I see are that practices don't know that they can negotiate rates, and they don't know that they can negotiate language. They sign what they're given, thinking that's the best they're going to get.

How do you recommend teams stay aligned across departments—clinical, financial, and operational—during the implementation of payer contracts?

Chatterson: I would back that up and not just emphasize the implementation stage, but also the negotiating stage. It's important for revenue cycle teams, finance teams, and, potentially, clinical teams to understand the language of an agreement. If the payer is asking for some degree of commitment—whether it's a notification of things from the credentialing department, legal and regulatory compliance, or they want access to an electronic medical record (EMR) or other clinical reporting—it’s really important to share that language and discuss it with other key stakeholders internally so that they understand what the practice is being committed to.

In the implementation stage, there are a lot of folks that need to understand that a contract is rolling out. If it's a net new payer or a net new contract, it's really important for your front-end staff, including registration and scheduling, to know that a product, line of business, or a net new payer is going live. If it's a new payer, there is often some build in the billing system so that staff can register patients correctly and avoid 10 different naming conventions for one payer for one line of business.

It's important for folks to know about narrow network products, if those exist. On the backend, it's important for folks to have access to the negotiated fee schedule so that they can ensure that the practice is paid what they're expected to be paid in the negotiated rates.

How do you see payer contracting evolving over the next 3 to 5 years, particularly in response to ongoing policy shifts and market dynamics?

Chatterson: That's a good question. I think it probably will only continue to get more complicated. If you're not really negotiating and a practice is just signing what the payer gives them, then you may not see how things are changing.

We're seeing language evolve where payers are trying to do more without asking permission. For example, an amendment can be implemented without mutual signing. We saw that several years ago. We're seeing language where payers are trying to assess a fee if the credentialing team doesn't submit an address or some type of provider change in a timely fashion, which is newer.

We're seeing payers try to input more specialty pharmacy use that would prohibit the practice's ability to buy and bill drugs. As the world gets more difficult and more complex for payers, either through competition or regulatory insights, you see that language reflected in the contracting. The pharmacy pieces and value-based care are the things that are evolving more rapidly. Payers are always looking for ways to better control costs and, of course, oncology spend is a big one in the US when you look at sub-service lines that a payer has to deal with.

Ways to control costs include things like a longer term, so that a provider cannot come back and negotiate. If the initial term is 3 or 5 years, that means that contract, in theory, is locked for that initial term. Putting more change management in the hands of the payer through a provider manual or an administrative manual that sits outside of the contract is another way payers can control the narrative of who does what and how we engage in a more complex way so that they have more control as the landscape and the industry changes.

We're also seeing a lot of innovators come into this space, more so than we've seen in the last several years. Folks are looking to carve out oncology care from an employer's group health insurance. They're offering a savings to the member and employer in exchange for this carve-out. It's more complex for the practice in terms of multiple ways to engage with referral streams, as well as running the business. However, it may also offer a better experience for the practice in that innovators often come with bundled payments or less administrative burden. I see the need to pay attention to this space growing more and more.