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Your contracting questions, answered by the people who negotiate every day.By Scott Dewey, Chief Managed Care Officer
One after another in 2025, payors have reported dramatically higher medical costs—costs that were not built into their premium models, putting their Medical Loss Ratios into unhealthy territories. Pressure on them is high to correct this trend, and you can expect to see these trends playing out in 2026 through:
1. More aggressive payor cost controls
Contract negotiations will be tougher, with rate increases harder to achieve. Expect expanded efforts to decrease medical costs via unfavorable policy updates, creative claim edits, downcoding pushes, increased documentation requests, and more aggressive utilization management denials. Payors are relying heavily on automation and AI, which means initial denials may spike across specialties.
2. Pricing discipline
Substantial premium increases in the commercial space are pushing employers as well as subscribers in individual and marketplace plans to look for ways to mitigate this cost increase, migrating patients into products with higher deductibles, copayments, and coinsurance, which means increased bad debt for providers. Exclusive-network and narrow-network products with their lower reimbursements will continue to grow.
3. Market and product withdrawals
Markets and products that are not profitable are being eliminated. Expect to see profitability override expansion, even if that means reversing product and service area rollouts that just happened last year.
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