Key Payers Denied Your Application Citing Their Network Is Closed – Now What?

Published in Government Relations on April 30, 2025

By Melanie Ewald, VP of Payer Relations and Reimbursement, VGM 

This experience has increasingly become one of the most common questions we receive from our provider members as more and more payers move to narrow their provider networks. The reasons payers seek to narrow their networks are simple. Payers are highly motivated to achieve their goals while doing less work and are not required to allow providers into their networks unless there is a patient access issue. For those of you fortunate enough to be a part of a narrow network, this may not be much of an issue for you.  

For those on the outside trying to get in, this can appear to be of great concern and detriment to your business. The answer in both scenarios is highly individualized to each business and is dependent on several variables such as the payer, type of contract, reimbursement rates, the administrative burden on you as the provider to provide the service, etc. That said, the strategy for maintaining in-network status and getting into a closed network are similar. 

There is no question the process of contracting with payers can be very challenging. Unfortunately, the days when payers would offer contracts to any interested provider are gone. Providers must now demonstrate to payers a justified argument as to why the payer should add them to their network. Below are some best practices for contracting when a payer denies an application citing closed network. 

Expose gaps in the payer’s existing network and be the solution. 

Review the payer’s provider network in your categories to identify gaps in the existing network. Network gaps may include any variety of issues such as: 1) Inadequate geographic coverage such that the in-network providers are not able to provide service to a location that you are able to reach; 2) Limitations in product scope that either a) unreasonably limit patient choice or, b) simply prohibit patients from obtaining a product due to the in-network provider not carrying it; and 3) Place of service limitations causing some patients to not receive services because in-network providers will not provide services in that setting. Take some time to analyze your situation to identify any other differentiators or gaps that you can help fill that are currently an issue with the payer’s network. 

Establish and convey your value proposition to the payer. 

In addition to identifying gaps in a payer’s network, you must also show payers why you should be added to their provider network through the value you bring. Do you offer a unique product or service not obtained elsewhere? Do you provide service or reliable outcomes data that other providers do not, resulting in quantifiable outcomes for the patients you serve? Include these important differentiators when demonstrating your value proposition. Just be mindful that your value proposition shows that your network inclusion is at least neutral to the plan administratively to avoid being seen as an additional administrative burden. 

Engage help from physicians, facilities, employer groups, etc. 

Your referral source relationships (e.g., physicians, hospitals, rehabilitation, SNFs, long-term care facilities, etc.) can play a critical role in obtaining access to a payer’s closed network. As you earn their trust and become their preferred DME provider for their patients, referral sources are often willing to provide letters of support or make calls to payers on your behalf to advocate for your admittance to the network.  

Gather and provide data. 

You likely have several sources of data at your fingertips that, once quantified, will further demonstrate your value and make the case for you to be allowed into the network. Examples of these data sources can include things like quantifying the number of the payer’s members that come independently or are referred to you on a monthly basis that you have to turn away or bill out of network. When you bill out of network and are able to secure single case agreement, quantifying the number of those agreements demonstrates the need for the payer to add you to their network. Other examples include quantifying and calling out any situations where patients are not able to obtain services due to a cap in coverage. 

Today’s payer contracting environment requires providers to continuously find ways to demonstrate their value to payers. The contracting process can be a time-intensive exercise with mixed results. You must be diligent in following up on your communication with payers and respond timely to their requests for additional information.  

While the above outlines a proven approach for overturning payer contracting denials due to a closed network status, payers still have the discretion to add or deny provider network access. In addition, as mentioned above, not all contracts are created equal or worth it at the end of the day. Being selective about where you spend your valuable resources is critical to any contracting strategy.