Most ABA owners treat a payer contract like the weather. The rate is the rate. You signed it the year you got credentialed, and you have billed against it ever since.
Meanwhile RBT wages went up. Rent went up. Health insurance went up. The rate on that contract did not move, because nobody asked.
Commercial payers negotiate. Not always, not quickly and not generously. But the owners who ask with good numbers get increases, and the owners who never ask get nothing. Here is how I would go about it.
Find the contracts that are losing money
Start with one number: what it costs you to deliver a billed hour of 97153. All of it. RBT pay and taxes, supervision you cannot bill, drive time, cancellations, billing, rent, admin.
Take a rough $3 million company with a 10% margin and an average 97153 rate of $60. Its all-in cost is about $54 per billed hour. Now split the hours by payer. These numbers are illustrative.
| Payer | Share of hours | Rate | Margin per hour |
|---|---|---|---|
| A | 30% | $66 | $12 |
| B | 50% | $60 | $6 |
| C | 20% | $51 | -$3 |
The average looks fine. Payer C does not. On about 40,000 hours a year, C is 8,000 hours at a $3 loss. That is $24,000 a year you pay to keep that contract.
Rate is not the whole story. A payer that denies more, pays slower or demands more unpaid paperwork costs more to serve. Adjust for it.
Do this now: Build that table for your own payers. Rate by code, hours, and margin per hour.
When to ask
Pull every contract out of the drawer and read three things: the term, the renewal date and the notice clause. Many payer contracts renew automatically, year after year, at the same rate. Say nothing and you have agreed to another year.
Payers move slowly. I would start four to six months before the renewal date, in writing, to the contracting or provider relations contact. Not the claims line. If you hear nothing in 30 days, follow up. Then follow up again.
Renewal is not the only opening. You have leverage when you open a location where the payer is short on providers, when you add capacity while others have waitlists, or when you have sat on the same rate for two or three years.
One caution on Medicaid. The state sets the fee schedule, and you cannot negotiate it one provider at a time. Managed care plans sometimes have room, depending on the state and the plan. Ask anyway.
Do this now: Put every renewal date and notice deadline on one calendar.
What data to bring
The worst pitch is "my costs went up." True, and the payer does not care. Everybody's costs went up.
The payer has its own problem: members who need ABA and cannot get it. Show that you solve it.
- Access. How fast a new client starts with you, and your waitlist for their members.
- Delivery. The share of authorized hours you actually deliver.
- Stability. Staff retention, and how long clients keep the same team.
- Quality. Outcome measures, parent training participation, family satisfaction.
- Clean billing. The share of claims paid on first submission.
- Cost. Your cost per hour next to their rate, and where their rate sits against the rest of your book. No naming other payers.
Put it on one page. A contracting manager with a hundred providers will not read ten.
Do this now: Start tracking these by payer today. You cannot build a year of data the week before the meeting.
Ask for a number, and plan for a no
Ask for a specific rate on a specific code. "We are requesting $55 on 97153, effective July 1" gets an answer. "We would like to discuss rates" gets a form letter.
The math is worth the effort. A 5% increase from Payer B is $3 an hour on 20,000 hours. That is $60,000 a year, for a company earning $300,000. No new clients. No new staff.
The first answer may well be no. So bring other asks: an annual escalator written into the contract, better rates on 97155 and 97156, faster payment, lighter authorization rules. A no on rate this year can still be a yes on something.
And if a contract still loses money after you have asked? Stop taking new clients from that payer and fill those hours from better contracts. Leaving the network is the last resort, never a bluff, and only with a transition plan for the families.
Do this now: Pick your worst contract and your biggest one. Send two letters this quarter.
The rate is a decision, not a fact
Every contract in your drawer is a price somebody agreed to. Usually you, years ago, in a hurry. You are allowed to revisit it.
If you want help building the payer table or the one-page case, that is the work I do. Thirty minutes on your business, your numbers and your next move. No pitch if it is not a fit.
Sources and further reading
- Billing Codes (ABA Coding Coalition)
- Medicaid MCO vs. Fee-for-Service: Why the Same Child Gets Different ABA Coverage in the Same State (Breaking News ABA)
Common questions
Can ABA providers negotiate rates with insurance payers?
Yes. Commercial payers negotiate. Not always, not quickly and not generously. But the owners who ask with good numbers get increases, and the owners who never ask get nothing.
When should I start an ABA payer contract negotiation?
Read the term, the renewal date and the notice clause in every contract. Many payer contracts renew automatically at the same rate, so saying nothing means another year. Start four to six months before the renewal date, in writing, to the contracting or provider relations contact, and follow up if you hear nothing in 30 days.
What data should I bring to negotiate ABA reimbursement rates?
Not "my costs went up." The payer has members who need ABA and cannot get it, so show that you solve that. Bring access, delivery of authorized hours, staff stability, quality, clean billing and your cost per hour next to their rate. Put it on one page.
Can you negotiate Medicaid rates for ABA?
The state sets the Medicaid fee schedule, and you cannot negotiate it one provider at a time. Managed care plans sometimes have room, depending on the state and the plan. Ask anyway.
What should I do if the payer says no to a rate increase?
Plan for it. Bring other asks: an annual escalator written into the contract, better rates on 97155 and 97156, faster payment or lighter authorization rules. If a contract still loses money after you have asked, stop taking new clients from that payer and fill those hours from better contracts. Leaving the network is the last resort.