By Bill Rusteberg
Warren is exactly right. All a plan sponsor needs when directly contracting with a medical provider is a one-page agreement. That’s what our clients have been doing for over two decades.
It’s not rocket science. “We agree to pay you X and you agree to accept it. You or I can terminate this Agreement any time with a 30 day notice.” It’s that simple.
Years ago I invited myself to a meeting with a large physician owned hospital. “What’s this about?” asked the hospital administrator. “I want to discuss a direct agreeement on behalf of my client, ABC Company” I replied.
At the appointed hour I was ushered to the hospital’s board room. As I waited C-suite types filed in and sat opposite. “Let’s start” said the hospital administrator. “We have 30 minutes. What’s on your mind and how can we help you Bill?”
I was well prepared. My style is to always go straight to the point and I had to do that under five minutes. Military briefings are exactly that, brief. After I made my pitch and the benefit to be gained by both parties, the hospital administrator said “Yes, we are interested. Please put together a proposal and we will consider it.”
“I have the Agreement right here” I said as I pushed it across the table.
As she studied it in silence her CFO sitting next to her did too. “Look at the J Codes, looks good” the CFO whispered.
The room grew silent, all eyes on the hospital administrator. The silence was killing me. I “bid” too low I thought. Will she tear it up, push it back across the table, reject the offer as unreasonable? I was prepared for that.
I learned long ago the first person to talk usually loses. So I kept quiet. After what seemed like an eternity she said with a poker face “Your timing is excellent. Our board meets once a month. We are meeting Monday. I will present this to our board and we will get back to you Bill.”
The meeting lasted 15 minutes and out the door I went, cautiously optimistic I made it to third base.
I called back a few days later to follow up, hoping to gauge interest. “Sorry Bill, but Ms. Jones is not available right now. Do you want to leave a message?” her secretary asked. “I’m calling to see if there is any additional information she needs” I offered.
Then she let the cat out of the bag. “Ok, she’s really excited about this Agreement, we all are! This will be the first Agreement we have done directly with any employer!”
The following week we had our one-page hospital agreement. It’s still in effect today.
