Deciding to Contract with a Payor: Joining "the Network"

Deciding to Contract with a Payor: Joining "the Network"

You've built the operation — clinicians credentialed, tech stack running, compliance buttoned up. Then a regional Medicaid managed care plan wants to talk about contracting. Your first instinct: great, let's do it. Then someone pulls up the 40-page contract with a 43-code prior authorization matrix and a data-sharing provision you're not sure sits cleanly with your other obligations. The fee schedule is fine. Not great — fine. And now the question isn't can we do this. It's should we, and on what terms? In this episode, Alex breaks down the payer contracting decision as what it actually is: a market entry and operational alignment commitment that happens to include a rate negotiation inside it. He walks through the six-dimension evaluation framework every health operator should run before signing anything. On the Out-of-Network Alternative Staying out of network intentionally can be a viable model — particularly in specialty markets where a practice can command premium rates on a self-pay or direct-pay basis. But it requires an honest accounting of trade-offs: 1. Payment at UCR (usual and customary rates) — not your billed charges, not in-network contracted rates 2. Limits on what patients can recover from their own plans, affecting your ability to attract and retain members 3. Collection burden shifts to the practice, along with associated staff time and friction 4. The No Surprises Act materially changed the out-of-network landscape for behavioral health providers in certain care settings — understand your exposure before assuming OON is a clean alternative Key Takeaways * Treat payer contracting as a market entry and operational alignment decision — not just a rate negotiation * In high-concentration markets, staying out of network often means locking out of the majority of the addressable population * Your value proposition — especially HEDIS gap closure and measurement-based care data — is a negotiating asset most practices leave on the table * Operational alignment costs don't show up in the fee schedule. Map them before you sign * The intersection of payer data sharing requirements and 42 CFR Part 2 is not hypothetical risk — it's real compliance exposure * For contracts involving risk-sharing, value-based payment terms, or complex data provisions, involve experienced healthcare counsel before execution Chapter Markers 00:00: Opening scenario — the 40-page contract lands in your inbox 01:30: Reframing the network decision — it's not a rate negotiation 02:40: Dimension 1 — Market access and concentration reality 04:00: Dimension 2 — Knowing and articulating your value proposition 05:10: Dimension 3 — Operational alignment and hidden administrative costs 06:20: Dimension 4 — Payer's past performance and claims adjudication reality 07:30: Dimension 5 — Physician profiling and measurement programs 09:00: Dimension 6 — Data sharing, 42 CFR Part 2, and compliance exposure 10:15: The out-of-network alternative — honest trade-offs 11:20: Practical takeaways and when to involve healthcare counsel

LEAD Model: The ACO Test Most Organizations Will Fail — Before They Apply

CMS has posted the LEAD (Long-Term Enhanced ACO Design) model application materials. Preliminary scoring is due April 27, 2026. Full applications are due May 17, 2026. LEAD replaces ACO REACH in 2027 and runs as a 10-year demonstration with enhanced payments and care coordination flexibility. Most ACO applications fail before they're submitted — not because organizations are ineligible, but because they were never really built for risk. This episode breaks down the six scoring domains, in order of importance, that CMS will use to evaluate your application. WHAT WE COVER 1. Financial Risk Readiness Define your risk corridor tolerance and downside exposure thresholds before anything else. Build a three-year proforma with utilization and trend assumptions. The CFO gut check: if trend runs 2% worse than expected, do you still survive? Secure financial guarantees and a reinsurance strategy before you submit. 2. Data and Interoperability It is not enough to collect data. CMS wants to see integrated clinical, claims, and SDOH data feeds with real-time or near real-time performance tracking. Demonstrate evidence of data-driven interventions — not just reporting. The core question CMS is asking: can you act on data, or just collect it? 3. Care Model Differentiation Define your care coordination infrastructure. Are you using RNs, community health workers, behavioral health integration? Do you have programs targeting high-cost, high-need (HCHN) populations? Are you integrating non-traditional services like doula care or CHWs? Reviewers want to see biopsychosocial care — not just medical management. Medical management alone is a red flag. 4. Network and Contracting Strategy CMS wants to see documented value-based contracts downstream — not just your arrangement with CMS. Can you push risk one step further? Do you have a specialist and post-acute alignment strategy? Note: roughly 80% of costs occur in the 90 days post-hospital discharge. Weak alignment equals leakage equals missed savings equals poor financial performance. 5. Operational Execution Plan Submit named executives and clinical leadership. Define your care workflows and escalation pathways. Provide a clear go-live and scale timeline. CMS reviewers are specifically watching for the "nice idea, no operator" red flag. They want robust operators behind every submittal. 6. Equity and Access Strategy Health disparities planning is no longer a narrative — it is a scoring mechanism. Whether or not you call it equity, operationalizing access will directly impact your financial outcomes. Integration with community-based organizations signals this. If you cannot operationalize access, you cannot succeed in this program. THE BRUTAL TRUTH Most organizations won't fail LEAD because they're ineligible. They'll fail because they realize too late they were never built for risk. LEAD isn't the program — it's a mirror. Start with your assumptions, not your application.

The Definitive Playbook for Choosing Behavioral Health Markets

Rate sheets don't tell the whole story. In this episode, Alex Yarijanian breaks down the 8-indicator playbook he uses to evaluate any tele-behavioral health market before committing capital — and names the specific states he'd enter today and why. Most operators default to the biggest states: California, Texas, Florida, New York. But population size alone is one of the weakest predictors of a winning market. The real levers live in parity law enforcement, workforce economics, MCO concentration, and infrastructure readiness. WHAT YOU'LL LEARN * Why the biggest states are rarely the best markets for tele-behavioral health * The 8 indicators that separate win-win markets from cheap-rate mirages * How to build a weighted scoring model before entering a new market * What associate-level billing eligibility does to your workforce margins * How MCO concentration affects contracting speed and rate-cut risk * Which states Alex rates as best all-around, high-risk, and growth-stage bets THE 8 MARKET INDICATORS 1. Medicaid market size: Total addressable population and realistic capture potential 2. Payment parity: State-level mental health parity laws and strength of enforcement 3. Cost of living index: The single best proxy for labor margin on clinical staff 4. Associate-level billing: Whether licensed associates can bill independently 5. HRSA HPSA demand mapping: Documented unmet need in mental health shortage areas 6. Broadband & 5G coverage: Infrastructure required for reliable telehealth delivery 7. MCO landscape: Plan count, behavioral carve-outs, any-willing-provider law exposure 8. Tax & corporate climate: State-level business environment and regulatory posture MARKET ARCHETYPES * Best all-around: Arizona, Nebraska, Delaware, Oregon * Volume, thin margins: Arkansas, North Dakota * High rate, high cost niche: Alaska * Growth stage bets: New Mexico, Montana 4 ACTION STEPS 1. Build a scroll scoring model — layer all 8 indicators into a weighted scorecard 2. Validate demand on the ground — overlay HRSA HPSA maps + FCC broadband gap data 3. Check your plan mix — count Medicaid MCOs and behavioral carve-outs 4. Run a payroll stress test — model cost of living vs. your target clinician pay band RESOURCES MENTIONED * HRSA Mental Health HPSA maps: data.hrsa.gov * FCC broadband coverage maps: broadbandmap.fcc.gov * NCSL mental health parity law tracker * Licensure compact maps: PSYPACT, ASWB Compact, Nurse Licensure Compact State Medicaid rate databases

Medicare Negotiates Like an Owner. Commercial Doesn’t.

In this episode of the VBCA Podcast, Alex Yarijanian sits down with Dr. Kumar Dharmarajan — co-founder and Chief Medical Officer of World Class Health and former Chief Scientific and Medical Officer at Clover Health — to unpack one of the most important structural differences in U.S. healthcare: incentive alignment. Why are employers often paying two to four times Medicare rates for identical procedures performed in the same hospital by the same physician? The answer isn’t clinical complexity. It’s incentive design. Dr. Kumar breaks down how Medicare Advantage plans negotiate as owners of financial risk — and why that matters. In contrast, much of the commercial self-insured market relies on administrators who negotiate without full downside exposure, creating a structural pricing gap. The conversation also explores: 1. What Medicare Advantage plans are actually looking for when contracting with digital health and AI solutions 2. Why engagement — not automation — is the real leverage point 3. The economics of supplemental benefits and underutilized Star opportunities 4. Home-based and remote care as risk containment strategies 5. The future vision of standardized specialty care marketplaces This is a structural conversation about incentives, risk ownership, and where execution truly matters in value-based care. KEY TAKEAWAYS 1. Incentive alignment drives pricing discipline. Medicare Advantage plans negotiate differently because they own the full medical loss ratio. 2. Commercial self-insured markets often lack that same alignment, contributing to higher negotiated rates. 3. AI in Medicare Advantage is less about backend efficiency and more about member activation and physician-level quality improvement. 4. Underutilized supplemental benefits represent unrealized revenue and quality movement. 5. Home-based and remote care models are fundamentally about managing high-acuity risk, not convenience. TIMESTAMPS 00:00 – Introduction 01:39 – What Medicare Advantage plans actually want from AI vendors 03:27 – Why engagement infrastructure is the real leverage point 04:28 – Virtual care, socioeconomic complexity, and risk ownership 06:18 – High-acuity members and access-driven cost escalation 07:11 – Supplemental benefits and engagement economics 08:36 – Stars, utilization, and revenue implications 09:55 – Employers paying 2–4x Medicare rates 10:27 – Why commercial pricing diverges 12:17 – Incentive structure and negotiation power 12:47 – Vision for standardized specialty care marketplaces ABOUT THE GUEST Dr. Kumar Dharmarajan is a practicing cardiologist and geriatrician and the co-founder and Chief Medical Officer of World Class Health. He previously served as Chief Scientific and Medical Officer at Clover Health and was on faculty at Yale School of Medicine, where his research helped shape national post-acute care quality measures. He has published in the New England Journal of Medicine, JAMA, and Health Affairs. Companies mentioned in this episode: 1. World Class Health 2. Clover Health

The Rural Health Transformation Fund: What States Are Funding in 2026

CMS is moving tens of billions of dollars into every state to stabilize rural healthcare heading into 2026—not through across-the-board rate increases, but through targeted investments in workforce, technology, care coordination, and alternative payment models. In this episode, Alex Yarijanian breaks down what the Rural Health Transformation Program / Rural Health Fund (RHTF) actually is, what state strategies reveal about the future of rural access, and why this matters far beyond rural hospitals—impacting payer strategy, provider contracting, network adequacy, and healthcare economics. You’ll hear key highlights from state plans including California, Texas, Florida, New York, and Illinois, plus the cross-state themes showing up everywhere: hub-and-spoke models, shared services, EMS reform, telehealth hubs, and AI-driven admin reduction (including automated fax processing). WHAT YOU’LL LEARN 1. What the Rural Health Transformation Program actually is 2. Why this funding wave is different (state plans are concrete and approved) 3. What state strategies reveal about access risk + reimbursement limits 4. How payers should interpret this as a network adequacy / access signal 5. Why providers should see this as both opportunity + accountability shift STATE HIGHLIGHTS COVERED California 1. Hub-and-spoke maternal + specialty access models 2. Example of rate + infrastructure working together (Health Plan of San Mateo specialty rate increases) Texas 1. Technology as a force multiplier 2. AI-enabled specialty access, telehealth coordination, clinically integrated networks 3. Tech becomes a parallel lever to reimbursement in high-dispute markets Florida 1. Remote patient monitoring (RPM) + community paramedicine 2. Utilization management upstream in MA-heavy environments New York 1. Patient-centered medical homes + workforce pipelines 2. Care coordination over unit cost expansion in concentrated payer markets Illinois 1. Integrated primary + behavioral health infrastructure 2. EMS treat-not-transport models 3. Alternative models as a response to inflation vs lagging rates KEY CROSS-STATE THEMES 1. Hub-and-spoke models are returning at scale 2. Shared services (centralized EHR, billing, analytics) to reduce admin burden 3. AI as infrastructure (clinical decision support + operational efficiency) 4. Specific AI use cases being funded: 5. Automated fax processing 6. AI scribes 7. AI-enabled care coordination KEY TAKEAWAY Rural health stabilization strategy is not uniform across states — but the goal is consistent: protect access where reimbursement alone hasn’t been enough. Mentioned in this episode: 1. Health plan of San Mateo 2. California 3. Texas 4. Florida 5. New York 6. Illinois 7. Oklahoma 8. Washington 9. Utah 10. Vermont