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Set up a facility contract

Facility contracts define how a facility reimburses your therapy organization for the services you provide.

Contracts tell RehabAlpha how to calculate the facility's payments to your organization for financial reports and facility invoices.

Who needs facility contracts?

Use facility contracts if your organization provides therapy services on behalf of a facility and the facility pays your organization. If your organization provides therapy directly—for example, an in-house skilled nursing facility or a typical outpatient clinic—you do not need facility contracts.

Before you start​

You need admin access, and a facility, billing providers, payors, and reimbursement arrangements.

Add a contract​

  1. Open the facility.
  2. Click Contracts.
  3. Click New contract.
  4. Enter the contract dates.
  5. Add contract payment terms.
  6. In Step 1: Choose how the facility pays [your organization name], choose a share of resolved payor reimbursement or a contract payment model.
  7. In Step 2: Choose payors, choose all eligible payors or filter them by payor type or specific payors.
  8. If you chose a contract payment model, complete its rates and rules in Step 3: Configure the contract payment model.
  9. Save the contract.

Contract structure​

A contract is made up of three main components:

  1. The contract period
  2. Payment terms
  3. Event charges

Contract period​

The start and end dates are boundaries at 12:00 AM (00:00) in the facility's time zone. A contract starts at the beginning of its start date and ends at the beginning of its end date. In other words, the end date is the first day the contract no longer applies. I.e. the contract period represents the a half-open interval [start date, end date).

You can use Way back for a contract with no starting boundary, or Indefinite for a contract with no ending boundary. A facility can have only one contract in effect at a time, so contract periods cannot overlap. Contracts may meet at the same boundary: set the next contract's start date to the previous contract's end date.

For this example, Contract A applies through May 31, Contract B applies from June 1 through December 31, and Contract C applies from January 1 onward. Read each boundary in the facility's local time, even when you view the contract from another time zone.

Payment terms​

A contract typically has some collection of payment terms. A payment term is a set of rules that specify how the facility pays your organization for therapy services. Each payment term applies to a distinct set of one or more payors, so you can set up rules like this 👇

If the payor is Medicare Part B, the facility shall reimburse us (the therapy company) 70% of normal Medicare Part B MPFS fee schedule-based reimbursement.

If the payor is Medicare Part A, the facility shall reimburse us (the therapy company) 65% of the Medicare Part A reimbursement, but only on days the patient recieves PT, OT, or SLP treatment.

Every payment term...

  1. targets a specific, distinct set of payors and
  2. defines the financial obligation of the facility to reimburse the therapy organization

A single payment term can configure the financial obligation of the facility in two ways:

  1. As a percentage of the payor reimbursement or
  2. As a contract payment model

For example, a facility contract could include these three payment terms:

Each payment term uses a payment model:

  • The first term applies to all Medicare Part A payors. The facility pays the therapy organization using the PDPM case-mix per diem payment model.
  • The second term applies to all Medicare Part B payors. The facility pays the therapy organization 75% of what the payor owes the facility. Set up a payor reimbursement arrangement to calculate that amount.
  • The third term applies only to Aetna. The facility pays the therapy organization a set dollar amount per minute under the Duration-based payment model. Aetna's reimbursement model can be different; add a payor reimbursement arrangement if you want to estimate what Aetna pays the facility.

RehabAlpha currently supports four different payment models:

When contracts are optional​

You can manage clinical documentation without facility contracts. Add contracts when your organization wants RehabAlpha to help support billing operations, invoices, or revenue sharing.