Reimbursement rates are by far the biggest source of provider complaints about working with insurance plans. Yet most providers I’ve spoken with have never asked for a raise, assuming they would be unsuccessful.

So you might be surprised to learn that providers are often able to negotiate raises. Recently, I was able to negotiate two raises for my contracts, and I have been happy to be able to help many therapists to get raises for themselves. I have also found that there seems to be no way to predict who will get raises. So why not try it? You’ve got nothing to lose.

Steps for Requesting a Raise

• Write a letter to the health plan requesting a reimbursement rate increase. I have two sample raise request letter templates – one for solo practitioners and one for groups – available for purchase in my online store – click here.
• In your letter, include
• if you are bilingual or multi-lingual (this is one of the strongest cards you may have to get a raise)
• how long you have been with the network, and your years of experience as a therapist
• if you are a high-volume provider or already serve a large number of their members
• your unique specialties or skills or experience, even if it is old (pre-private practice) experience. This may include:
• children and adolescents
• ADHD and Autism, especially using ABA techniques
• PTSD / trauma, especially using EMDR
• substance abuse or other addictions
• eating disorders
• veteran’s issues/military families
• chronic pain
• crisis/emergency care
• ability to provide post-discharge care for psychiatric inpatients
• severe mental illnesses / personality disorders
• Ask yourself, “what additional education or training or experience do I now have that I didn’t when I applied to the plan, that might make me worth more?” You may be able to negotiate a higher rate if you have special advanced trainings or certifications, such as Certified Employee Assistance Professional (CEAP) or Substance Abuse Professional (SAP), or EMDR. They also love to see advanced training in Cognitive Behavioral Therapy or Brief Therapy.
• Think about how you are able to provide access and availability that many others don’t. Are you licensed in other states? Do you offer weekend hours, evening hours? Do you work in an underserved area? Do you have two offices so you can serve more of the plan members over a wider geographical area?
• What else can you offer beyond therapy? Can you provide employer training or lectures or Critical Incident Stress debriefings?
• You may have an advantage if an employer specifically requests your inclusion, or if you are part of a multidisciplinary and/or group practice that can offer a continuum of services.

Bottom line: Let them know why you are worth paying a bit more to keep.

A few final tips:

• Name the fees you are requesting for each service you provide (use CPT codes). I usually suggest you ask for $20 more than you are getting now for each type of service, but don’t be afraid to ask more, if you feel bold.
• Don’t whine about how your office expenses have gone up, the cost of your daughter’s college or your son’s braces. If you want to quickly mention that you are seeking a rate increase in part due to the higher cost of living, fine, but don’t dwell on it – it’s better to focus on your value to the network.
• Avoid making resignation threats or blackmailing them. You may, however, hint you are unsure if you can continue at the current rate.

Now that you have your letter, what next?

• Call the insurance plan’s Provider Relations or Provider Contracting Department and ask where to send your letter. You want to have your letter written before this phone call, as they may say they are willing to discuss your request by phone, and you want to be ready with your talking points. You will likely be asked to put your request in writing. Ask whether you can fax or e-mail it, and to whom you should address it.
• Follow up if you don’t hear back from them, to be sure they received it.
• If you are unsuccessful, try again in six months.

Why can’t your professional organization lobby on your behalf for better rates?

Many providers wish their professional organizations would lobby managed care plans for raises on their behalf. However, most professional organizations will tell you that legally they are not allowed to become involved. But according to my research and the lawyers I have consulted, self-employed therapists have individual contracts with the plans, and cannot collectively bargain – with or without their professional associations. Only individuals who are employees who hold non-managerial positions can organize as a union does to collectively negotiate. As independent contractors, therapists cannot boycott, strike, threaten as a group to resign if rates are not increased, or fight together for a minimum reimbursement. This behavior would be considered “price fixing” or “restraint of trade,” and violates the Sherman Antitrust Act.

To land you in hot water, the plan would need only to establish that there has been some sort of “contract, combination, or conspiracy” between providers in an effort to collectively bargain and control rates. Such an agreement does not need to be in writing: According to many lawyers I’ve consulted and what I have read from trusted online sources, even an informal discussion between therapists at a social function or via social media expressing dissatisfaction about a plan’s reimbursement rates, followed by a mass action such as resignation from that plan to protest rates could support a successful antitrust prosecution. This could result in fines up to $350,000 or three years’ imprisonment, or both.