Theo ran his first three contract renewals the same way: show up prepared, present the numbers, negotiate the terms, leave. Clean, efficient, professional. Then a claims processing error on the payer's side threatened to delay a batch of reimbursements right before quarter close, and Theo needed a favor, a faster review, a little flexibility on timing. The payer's negotiator gave him the standard process and nothing more. They'd never had a reason to give him anything more. Theo had never given them one either.
He got the resolution eventually, on the payer's normal timeline, three weeks later than he needed it.
What efficiency quietly costs you
Negotiating efficiently feels like the professional move, and in the moment, it often is. But a negotiation conducted purely transactionally builds a contract and nothing else, and contracts don't return your calls when something goes wrong outside the terms you negotiated.
The external problem is real: healthcare has less time for the kind of relationship-building it used to have. I came up in an era of long business lunches, and I still remember a payer representative I got to know over shared plates of barbecue shrimp at a favorite New Orleans restaurant before every negotiation cycle. Those lunches are mostly gone now, replaced by tighter schedules and video calls squeezed between other meetings. But the internal problem, the one that actually costs organizations when things go wrong, is treating that shift as permission to skip relationship-building altogether instead of finding a faster way to do it. Theo didn't lack the time to build trust with his counterpart. He just never thought to spend any of the time he had on it.
I've relied on the goodwill built during negotiations more times than I can count, in moments that had nothing to do with the original contract. That goodwill doesn't show up in a rate sheet. It shows up exactly when you need it most.
Five (5) practices that build the relationship, not just the deal
Start with open communication. Be upfront about what you can and can't share, including your general goals, before the negotiation gets adversarial. I open most contract negotiations with a one-on-one conversation specifically to set that tone before either side starts positioning.
Build trust through reliability. Follow up on every commitment, even the small ones, because nothing destroys credibility faster than a promise that quietly goes unkept. Consistent follow-through is what turns a one-time deal into a relationship the other side actually wants to maintain.
Practice real empathy and active listening. Give full attention, without the distraction of a phone or a half-finished email, and actually hear what the other party's constraints and motivations are. That's often where the actual path to agreement shows up, not in the numbers either side started with.
Manage conflict directly and promptly. Address disagreements as they surface instead of letting them harden into resentment. I learned this early, growing up in a loud, part-Sicilian family where nothing went unaddressed for long, and it's served me well at the negotiating table ever since.
And negotiate for long-term value, not just the win in front of you. A mindset built around mutual benefit, where both sides feel genuinely invested in the outcome, is what makes the next negotiation easier instead of harder.
What changes when the relationship exists
Skip this, and every negotiation stays transactional, which means every future problem outside the contract's explicit terms gets handled at arm's length, the way Theo's claims delay did.
Theo rebuilt his approach after that experience. He started opening negotiations with the kind of one-on-one conversation meant to set tone rather than terms, followed up on every small commitment he made, and stayed reachable between negotiation cycles instead of only during them. The next time a processing issue threatened a deadline, his counterpart called him directly, flagged the problem before it became urgent, and the two of them resolved it in a day.
Before your next negotiation, plan one specific way to build the relationship, not just the deal, whether that's a direct conversation up front or genuine follow-up after the terms are signed.
The rate sheet gets you through this negotiation. The relationship is what gets you through the next one, and the one after that, especially the times something goes wrong that no contract clause covers.
Call to Action: If a relationship you built during a negotiation ever paid off somewhere you didn't expect, tell me about it in the comments. Those are exactly the stories worth passing on.
Send this to the negotiator on your team who treats every deal as a one-time transaction.
About the Author: Kevin W. Barron, MBA, FHFMA, FACHE is a nationally recognized healthcare contracting and payer relations executive with over 30 years of experience in healthcare finance. He is an author, speaker, and mentor to emerging leaders in healthcare finance. Follow Kevin on LinkedIn or subscribe to his weekly newsletter at https://www.KevinWatsonBarron.com
Disclaimer: This article is provided for general informational and educational purposes only. It reflects my personal views and observations based on professional experience in healthcare finance, managed care, payer relations, and revenue cycle operations. It should not be interpreted as legal, financial, regulatory, actuarial, or reimbursement advice. The content is not intended to represent the official position of my employer, any payer, provider, professional association, or other organization with which I may be affiliated. Readers should consult their own legal, financial, compliance, actuarial, or operational advisors before making decisions based on the issues discussed. Any references to payers, providers, regulations, market trends, or reimbursement practices are intended for discussion and education only and should not be construed as a statement about any specific contract, negotiation, patient matter, or confidential business arrangement.