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Contract modeling tech helps Owensboro Health steer clear of a costly deal

January 08, 2020 / Bill Siwicki

The health system’s biggest payer presented it with a contract the payer said would net Owensboro $12 million a year. The health system’s financial IT said something quite different. When negotiating with payers, health systems are challenged at estimating how much a proposed contract will cost them – or whether they’ll actually make a profit. This is especially true of smaller health systems that cannot afford large teams of analysts to crunch the numbers. Payers, on the other hand, have large teams of analysts that are very good at producing these estimates. Some payers may even take advantage of the imbalance in capabilities to write contracts that favor them while getting as much as they can out of providers. In a worst-case scenario, providers actually lose money on contracts.