University of Southern Indiana

Overview

A major responsibility for the case manager is making arrangements for services and equipment. Negotiating for fees is an acquired skill that takes thought, planning, and practice. Negotiating for fees can be intimidating in that the case manager goal is to arrange for quality care that is cost effective. In health care, the desired outcome of negotiation is to reach a mutually agreeable point that is a win-win situation for all parties involved in providing care and services to the patient.

Upon completion of this unit, the participant will be able to:

1. Describe the five steps of negotiation.
2. Describe the three critical elements of negotiation.
3. List seven practical tips for negotiation.
4. Distinguish between different types of case management negotiation

I. Negotiation

A. Negotiation - the art and science of arriving at a successful solution to a situation involving more than one person or organization. The outcome is quality cost effective care that is optimal for all parties involved in the situation.

1. It is important to remember to focus on the issue and not “attack” the other party
2. Negotiation is the attempt to find a creative solution to a problem in which both parties feel successful.

a. win-win solution is where both parties have the outcomes met.
b. compromise may be where both parties give up something to come to a solution but in doing so, neither party successfully meets the expected outcome(s)

B. Five Steps in Negotiation

1. Preparation

a. critical first step in which you do your homework

1) learn about the other party, gather facts not assumptions
2) clearly know your desired outcomes
3) learn about what is happening in your geographic area
4) gather information about state and national expectations

b. develop general goals and objectives
c. identify several win-win options. Always have more than one plan that is acceptable to you. If Plan A is not going to work, can you live with Plan B or Plan C? Think about this ahead of time to avoid making a rash decision.
d. identify in advance what you are willing to concede or give up.
e. be prepared to walk away and contact another agency that provides the service you need.

1) if the other party knows they are the only option, there is minimal opportunity for any type of negotiation

f. practice what you want to say prior to the meeting.

1) a good place to practice is in the bathroom in front of the mirror.
2) try different approaches to identify the method(s) that work best for you

g. practice the use of silence. Silence may be a very effective tool in negotiation

1) while you are silent the other party may feel the need to talk thus giving you additional information about them
2) while you are silent, listen carefully to what the other party is saying.
3) learn when you are comfortable using silence (type of scenarios, amount of time). Everyone is different so the use of silence is a very individualized approach.

2. Entry

a. if you are meeting with the other party

1) the first meeting should be on neutral ground.
2) power dress, feel empowered by how you look and feel
3) keep social activities and discussion to a minimum. If you socialize to much, you may run out of time or be perceived as not being serious about the needed service

b. if you are negotiating the service over the phone

1) place the first phone call to set up a time and length of the call with the agency representative so you both have time to discuss the service needed.
2) keep social activities and discussion to a minimum.

c. both methods

1) approach the issues in terms of what you see as a win-win for both parties
2) be willing to listen to the other side
3) ask questions; encourage the other side to talk to gain further insight into what their agenda is regarding the issue. You can then decide to proceed forward or change your strategy

3. Elaboration/Education

a. share information that you feel is pertinent to the issue.
b. honesty and truthfulness are critical
c. written documents may be introduced here if necessary to convey your position.

4. Bargaining

a. focus on the issue, do not get side-tracked by lesser or unrelated issues
b. decide when and what you want to concede. May want to concede the first minor point if you think this will assist you in reaching the major goal.

5. Closure

a. summarize the points/decisions
b. always follow up with a letter to clarify the decisions
c. document the results in the medical record.
d. debrief after the meeting. Analyze what happened, what you did well and what you could improve on.

C. Four Critical Elements of Negotiation

1. Time - the period over which the negotiation process takes place. There are several tips to remember to help bring time to your side during negotiations:

a. be patient, it is not uncommon to reach concessions and settlements in the last 20% of the interaction
b. if there are benefits to reaching resolution quickly, sell your counterpart on the benefits
c. as deadlines near, stress levels will tend to rise. If you can determine your counterpart's deadline, you may have a negotiating edge.

2. Information - in general, the more you have, the better off you will be. Never underestimate the usefulness of gathering all necessary information as soon as possible.
3. Power - the ability to influence people or situations.
Remember: power is neither good nor bad except when it is abused!
4. Excellent listening skills – this includes verbal and non-verbal cues that may give you insight into the other party’s needs or concerns.

D. Practical Tips

1. Do not negotiate with a non-decision maker. You should establish very early in the process the decision making authority of your counterpart. Even though you may like working with your counterpart, you may waste a lot of time working with a non-decision maker.
2. Let the other person go first - this may give you insight into the other party’s desired outcomes
3. Create an environment in which your guidelines or standards appear reasonable. Through the effective use of guidelines or standards, the other party may fill they need to use your standard to appear reasonable.

a. An example might be: Our standard protocol in which we have negotiated this service with other companies is to . . .

4. If you play in the major league, establish your ballpark - tell a story about a previous negotiation to let your counterpart know a little bit about what you expect. For example, "I recently had a case where I was able to get a daily rate of ____".
5. Use odd numbers when initially discussing a dollar figure. Do not use round numbers just because they are easy to come up with. Round numbers beg to be negotiated and are usually countered in round numbers. Odd numbers sound harder, firmer, and seem less negotiable.
6. Avoid showdowns. Do not confuse negotiation with manipulation. It should not be a contest to see who can outlast the other person.
a. a showdown now may lead to less than effective future negotiations
7. Know what services you are seeking - any ground you may have gained may be lost if you appear to not be as knowledgeable as you originally present yourself
8. Always document agreements in writing. Even with an excellent working relationship, time has a way of eroding memory. Formalizing even the simplest negotiation in writing will eliminate any questions.

E. Four Types of Negotiation Situations in Case Management

1. Negotiating with providers of care for the cost of services and supplies

a. There is potentially an endless list of services and supplies that may need to be negotiated such as hospital care (per diem or case rates), artificial limbs, and even ostomy supplies

2. Negotiating with providers of care for the specific services and supplies to be provided

a. This type of negotiation may also be referred to as utilization review or management
b. Negotiations might be necessary for the specific type of service performed including inpatient hospitalization versus outpatient surgery with home health care follow-up
c. Number of services to be performed such as physical therapy three time a week for four weeks versus two times a week for three weeks with reevaluation
d. Actual provider that will provide the service such as one particular home health care or durable medical company versus another.

3. Negotiating with the payer or referral source for approval of the cost or types of services and supplies.

a. At various intervals throughout a case it may be necessary to obtain payer or referral source approval for parts of the treatment plan.
b. For example, if a benefit contract does not include coverage for the purchase of equipment but does include coverage for equipment rental, it may be necessary to negotiate special approval for equipment purchase if it is a more cost effective alternative

4. Negotiating with the patient and/or family for approval of the case management plan

a. In most cases, patient and/or family buy-in to the case management plan occurs with minimal difficulty.
b. There can, however, be circumstances where the patient and/or family's desires exceed their actual needs. The case manager words with the patient and family to identify the appropriate resources.

F. Conclusion

1. Negotiation is an acquired skills that takes thought, planning, and practice.
2. Continued use of these skills leads to quality cost effective health care services.

Suggested Web Resources

What is Negotiation -By Peter B. Stark
http://www.smartbiz.com/sbs/arts/wwt1.htm


Additional Resources

Dolan, J. P. (1992). Negotiate like the Pros. New York: Perigee Books.

Ilich, J. (1996). The Complete Idiot's Guide to Winning through Negotiation. New York: Alpha Books.

Walker, R. Take it or leave it: The only guide to negotiating you will ever need. Inc. Magazine (August 2003) http://www.inc.com/magainzine/20030801/negotiation.htm

Continue to the post test.
 

Top • Previous Location