For UK independent hospitals
Your PMI tariffs were set before inflation hit, now insured patients cost you margin
Multi-year contracts negotiated before recent inflation no longer reflect the real cost of consumables, energy, and staff. For a hospital with substantial insured revenue, even a modest tariff improvement can be worth a six-figure sum a year.
Two minutes. Solva follows up with specific PMI renegotiation options.
The Independent Healthcare Providers Network's 2024 commercial survey found that independent hospitals that engaged specialist commercial support for PMI negotiations achieved an average rate uplift of 18% compared to 7% for those that negotiated internally. Over 60% of independent hospitals reported that their PMI rates had not kept pace with cost inflation since 2022. (IHPN, 2024)
Frequently asked questions
Why does this problem persist?
Independent hospitals negotiate tariff rates with PMI providers on multi-year contracts. Inflation in clinical consumables, energy, and staff costs since 2022 has eroded the margin on many procedures for hospitals that have not renegotiated. PMI providers have strong incentives to delay rate reviews and rely on hospitals not having the benchmarking data or commercial expertise to mount a credible negotiation. Hospitals that are below market on key procedures are effectively subsidising insurer profits.
What is the cost of leaving it unaddressed?
A 10% improvement in PMI tariff rates on £5 million of insured revenue is worth £500,000 per year. Specialist commercial support for PMI negotiation typically costs £15,000 to £40,000 and pays back within the first contract year. (IHPN, 2024)
This is exactly what I do with UK private practices. Answer the few questions above and I'll come back personally with where to start. Paul.