negotiating and renegotiating successful tactics
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Negotiating and Renegotiating Successful Tactics. February 23, 2013 Mike Valentine, MD Centra Medical Group – Stroobant’s Heart Center Cardiovascular Summit Co-Chair. Negotiating 101. Who are we? What arrangements are in place? What are our options? How can we succeed?. - PowerPoint PPT PresentationTRANSCRIPT
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Negotiating and Renegotiating
Successful TacticsFebruary 23, 2013Mike Valentine, MD
Centra Medical Group – Stroobant’s Heart CenterCardiovascular Summit Co-Chair
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Negotiating 101
• Who are we?• What arrangements are in place?• What are our options?• How can we succeed?
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Know Your Options
• Medical Directorships– Cath Lab - Outreach Director– Non-Invasive Lab - CME– Clinical Quality
• Co-Management Agreements• Call Coverage – ER / STEMI / Nights• Leadership / Management
– Dyad Models
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Know Your Options continued…
• Hospitalist Service• Recruitment Assistance• Joint Ventures• Horizontal Integration• Vertical Integration• Employment
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Negotiating 101
• NEGOTIATION is the means by which an agreement is reached.
• You must start with the END IN MIND
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Negotiating 101
Success
HumilityFlexibility
Mutual Gain (Win-Win)
Failure
ArroganceIgnorance
Selfishness
Do NOT Act Like A Cardiologist!
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Negotiating 101
• Key Advice– Know who the dealmakers are– Separate the people from the problem– Focus on interests, not positions– Use objective criteria– Invent options for mutual gain
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Negotiating 101
• Negotiation Language– Most Favorable Position/Maximum Plausible
Position– Walk Away Position– BATNA (Best Alternative To Negotiated
Agreement– Inexpensive Valuable Concession– Time Out
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Negotiating 101
• Five Steps in Negotiation1. Prepare2. Engage3. Propose4. Bargain5. Agree
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Negotiating 101
• Successful Negotiation Means Each Side Feels:– Sense of Accomplishment– Other side cared– Other side was fair– Would do it again– Will keep the bargain– Can say thank you and mean it
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Negotiating 201
• Tough Love• Keep you friends close, but keep your
enemies closer
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Negotiating 201
• Maximum Plausible Position• Bracketing• Reluctant Buyer/Seller• Higher Authority• Concessions• Impasses/Stalemates• Closing
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Negotiating 201
• Maximum Plausible Position– You go first
• Bracketing– They go first– Best if you don’t know them well– Allows equal counter on either side– May get what you want!– Never say yes to first offer
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Negotiating 201
• Reluctant Buyer / Seller– Range up front– Walk away price– Feel / Felt / Found – key phrases– State position, then BE QUIET!
Silence is Power
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Negotiating 201
• Higher Authority– Never be the decision maker– Leave ego at home – Appeal to theirs!
• Concessions / Commitments
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Negotiating 201• Impasses
– Set them aside– Split the difference
• Stalemates– Share risk– Win-Win– Change the teams, Remove the loser– Third party arbitrator– Always save face
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Negotiating 201
• Always use an expert• Double agents are invaluable• Verbal, then written• Never have a deadline
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Renegotiating 301
• Renegotiation starts the day you sign a contract
• Build and prove – Value and Trust
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Renegotiation Rules
• Record the victories• Prove your value with Leadership!• Know the “Fair Market Value”• Keep your expert close• Reimbursement models are changing –
more is at risk
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Renegotiation AssumptionsOffensively you have:• Developed a relationship
with the hospital• Committed to a common
vision• Honed your decision making
model• Created value in the system
(and can quantify it)• Maintained productivity• CREATED TRUST
Defensively you have:• (Unusual) Compensation
escalator• Non-Compete Management• Cardiologist recruiting and
employing exclusivity• Unwind provision• Medical records access• Understanding of
renegotiation parameters at the outset
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Key Business Underpinnings
• Health Systems attuned to changing reimbursement dynamics
• In past, more wRVUs = better• Today, systems want to incentivize patient
health management and efficiency– New definitions of productivity– Systems focused on flexibility
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Warning Signs
• Health system complains about “losing money” on employed physicians
• System approaches renegotiation as “take it or leave it”
• Renegotiations are conducted on physician-by-physician basis
• System discourages physicians of obtaining guidance from third parties
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Positive Indicators• System regards physicians as “adding value”• Physicians involved in CVSL management • Physicians have no post-termination non-
compete– Or, only a “soft” non-compete, permitting return
to independent practice• Renegotiation dialogue is open and
respectful
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Final Thoughts
• Financial discussions are often sensitive– Third party assistance may be helpful buffer
with employer• Compensation renegotiations are
meritably distracting– No perfect solution available, it is impossible
to predict market changes– Set a deadline and stick to it
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Questions?