Your fee schedule is the foundation of your revenue. Set prices too high, and you invite audit scrutiny and negotiation pressure. Set them too low, and you leave money on the table. Getting pricing right requires data, strategy, and regular review.
The Saudi Pricing Landscape
Healthcare pricing in Saudi Arabia is influenced by several factors:
- CCHI fee schedule guidelines: CCHI publishes reference pricing for common services
- Payer-specific fee schedules: Each insurance company negotiates its own rates
- SBS pricing: The Saudi Billing Standard defines base prices for procedure codes
- Market competition: Pricing varies by region and facility type
- Contract terms: Volume discounts, bundled rates, and performance incentives
Building Your Fee Schedule
Step 1: Gather Your Data
Collect your current fee schedule data:
- All SBS codes you bill
- Current charges for each code
- Actual reimbursement by payer (not charges, actual paid amounts)
- Volume by code and by payer
- Denial rates by code
Step 2: Analyze by Payer
| Payer | Volume | Your Charge | Paid Amount | Discount % | Denial Rate |
|---|---|---|---|---|---|
| Payer A | 40% | SAR 500 | SAR 350 | 30% | 5% |
| Payer B | 25% | SAR 500 | SAR 300 | 40% | 8% |
| Payer C | 20% | SAR 500 | SAR 380 | 24% | 3% |
| Payer D | 15% | SAR 500 | SAR 250 | 50% | 12% |
This analysis reveals which payers are paying below your average and where to focus negotiation.
Step 3: Benchmark Against CCHI Reference
Compare your charges to CCHI reference pricing:
- Services charged above 120% of CCHI reference → Audit risk
- Services charged at 80-100% of CCHI reference → Competitive
- Services charged below 80% of CCHI reference → Potential revenue leakage
Step 4: Segment Your Codes
Not all codes should be priced equally:
| Code Category | Pricing Strategy |
|---|---|
| High-volume, low-value | At or near CCHI reference |
| Low-volume, high-value | Premium pricing (justified by complexity) |
| Unique/specialty services | Market-based pricing |
| Commodity services (labs, imaging) | Competitive pricing |
Negotiating with Payers
Know Your Leverage
Before entering negotiations, understand your position:
- What percentage of your volume does each payer represent?
- What is your facility's CCHI accreditation score?
- How does your quality compare to peers?
- Are you the only provider of certain services in your area?
Negotiation Targets
Focus on these elements in payer negotiations:
- Base rate increases: Tie to CCHI accreditation score
- DRG weight multiplier: Above standard if your case mix is complex
- Outlier payment terms: For high-cost cases
- Denial rate guarantees: Hold payers accountable for timely processing
- Contract termination terms: Ensure reasonable notice periods
Use Your Data
Present data during negotiations:
"Our coding accuracy rate of 96% exceeds the CCHI threshold. Our denial rate of 6% is below the market average of 11%. Based on these quality metrics, we request a 5% rate increase across all service categories."
Fee Schedule Review Frequency
| Review Type | Frequency | Focus |
|---|---|---|
| Quick review | Quarterly | Update new codes, remove inactive codes |
| Payer analysis | Semi-annual | Compare reimbursement by payer |
| Full market review | Annual | Benchmark against CCHI reference and market |
| Contract renewal | Per contract | Adjust fee schedule before negotiations |
Common Pricing Mistakes
- Charging below cost: Know your cost per service. Do not accept rates below cost for high-volume services.
- Uniform pricing across all payers: Different payers should have different rates based on volume, reliability, and relationship.
- Never reviewing fee schedules: Fees should be reviewed at least annually. Inflation, regulatory changes, and market shifts all affect appropriate pricing.
- Ignoring denials in pricing: High denial rates effectively reduce your reimbursement. Factor denial rates into your pricing.
Conclusion
Fee schedule optimization is an ongoing process, not a one-time exercise. Providers who regularly analyze their pricing, benchmark against the market, and negotiate from a data-informed position will achieve 5-15% higher net revenue than those who set prices once and leave them.
ProMedInsure offers fee schedule analysis and payer negotiation support. Contact us for a fee schedule benchmark report for your facility.