Notes on payer behavior

New contract rates on January 1: how to check the insurer is actually paying them

Clearia · November 2026 · contracts and fee schedules

January 1 is when most contract rate changes take effect, and it's when payments most often come in wrong. Increases get loaded late. Contracts tied to Medicare move when Medicare does. And nothing on the statement says a payment used the old rate. A 30-minute check in February catches it.

Here's a line from an insurance statement. An illustrative example. The knee surgery, paid $1,180, "per contract." The contract rate went to $1,240 on January 1. Balance: zero.

Nothing looks wrong. It really was paid at a contract rate. Just last year's. It's one of the first patterns our team checks for, because when it happens, it happens on every claim for that code.

Three ways a new rate goes missing

1. The increase never got loaded. You negotiated a raise, say 3% each January. The payer's system still pays last year's fee schedule. Every line is short by the same small amount, for months.
2. Your contract follows Medicare, and Medicare changed. Many contracts pay a percentage of Medicare. If yours points to the current year, your rates move every January. For 2027, Medicare's main conversion factor drops 2.31% (details in Medicare's 2027 fee schedule changes). Your right rate may go down. The payer still has to use the right year and the right percentage.
3. The new rate lands on the wrong dates. In most contracts, the date of service sets the rate, not the date of payment. When rates go down, watch December visits paid in January. They should still get the 2026 rate.

The 30-minute February check

1. List your ten highest-volume codes for each of your top three payers.
2. Write the 2027 rate next to each one, from your contract or fee schedule. If your contract pays a percentage of Medicare, multiply the 2027 Medicare amount by that percentage.
3. Pull the first January payments for those codes. Your billing team can export them from the remittances, the payment statements insurers send with each check or deposit. Compare the allowed amount to your rate.
4. If one line comes in low, check five more for the same code. A loading error repeats on every claim.

Small per line, large across a year. A 3% increase missed for twelve months, on a payer that pays you $500,000 a year, is $15,000. Illustrative arithmetic, but it's the shape of it.

How do you get the difference back?

Dispute the pattern, not each line. Show the contract rate, the amount paid and the list of affected claims. Ask the payer to reprocess them all at the right rate. The six steps are in how to appeal an underpaid claim.

Timing matters. In Florida, physicians on fully insured plans have 12 months to dispute an underpayment, and the payer can't shorten that by contract (Florida's 12-month underpayment rule). Self-funded employer plans follow your contract's window, which is often much shorter. Payer by payer, the windows are in our appeal deadlines table.

What this means for your practice

No statement will ever say "short." A rate that never got loaded looks exactly like a rate that did. The only way to see it is to compare what came in against what you signed, and January is when that comparison pays off most.

If you can't get the export, or the contracts are scattered, start with one payer and five codes. One clean comparison tells you whether there's a problem worth a bigger look. More ways to check are in how to tell if an insurer is underpaying your practice.