Navigating Payor Contracting and Offshore Vendor Use

We have spotted a new trend in urgent care payor contracting, which could significantly impact urgent care payments. Payors are beginning to add a clause to their agreements prohibiting providers from using “any services” performed by vendors located outside the U.S. or vendors who use subcontractors outside the U.S., unless the offshore vendor is approved in writing in advance by the payor and is available for audit by the payor.

This means that use of software, billing and any other service from vendors that locate any portion of their operation outside the United States or utilize subcontractors who are located outside the U.S., will make your urgent care center ineligible for payment under the payor agreement and by extension, subject to take-back of payments received while using a vendor with offshore connections. According to the language in the agreements we have reviewed, the exclusion covers all vendors and subcontractors with operations located outside the the United States and its territories. Under these agreements, providers are subject to audit of any offshore providers they are using with advance permission and responsible for the related expenses of those audits.

To avoid the workflow disruption and financial impact that will come from payor identification of your vendors as having offshore connections, ask your vendors if they conduct all of their business in the U.S. and use only U.S. subcontractors. It would be best to have this information before you sign an initial or renewal agreement, but you need to know as soon as possible so you can plan to change vendors and remain compliant with your payor contracts.  Although changing vendors is a difficult step, you will find that use of exclusively U.S.-based vendors will have the added advantages of increasing quality, improving security and enhancing performance, all of which will improve the long-term success of your urgent care center.