Can you say exposure? The Contract You Signed Is Now Your Biggest Liability

It doesn’t start with an audit.

It starts with a letter.
A routine request.
A few documents.
Nothing urgent.

Until it is.

The Story No One Thinks Will Be Theirs

A regional health plan recently believed they were operating a high-performing network:

Strong provider relationships
Value-based contracts in place
Stable medical cost trend

Then regulators started asking questions.

Not about claims.
Not about coding.
About the contracts.

Within months:

Key arrangements couldn’t meet federal requirements
Financial terms raised compliance concerns
Documentation didn’t support how payments were structured

And suddenly, everything tied to those contracts was at risk.

Revenue.
Relationships.
Reputation.

This Is Where Enforcement Has Moved

Federal oversight has shifted—quietly, but aggressively.

The Department of Justice, HHS Office of Inspector General, and Centers for Medicare & Medicaid Services are no longer just reviewing what was billed.

They are asking:

Was the contract valid in the first place?
Were the financial relationships appropriate?
Did the arrangement meet federal requirements?

Because if the answer is no—
every dollar that flowed through that contract becomes questionable.

Recent federal findings underscore the scale of the issue:

Billions in federal healthcare contracts flagged for failing basic requirements
Record False Claims Act recoveries tied to improper financial relationships
Ongoing investigations into provider arrangements, MSOs, and delegated entities

This is not a compliance trend.

It’s a structural reset of how healthcare is being enforced.

Why This Is More Dangerous Than a Coding Audit

Coding errors can be corrected.
Documentation can be improved.

But contracts?

Contracts define:

Who gets paid
How they get paid
Why they get paid

If those foundations are flawed:

Payments may not be defensible
Incentives may be misaligned
Entire networks may be exposed

And unlike a claim, you can’t “fix” a contract after the fact.

The Exposure Most Organizations Haven’t Quantified

Across health plans, health systems, and MSOs, we consistently see:

Value-based contracts that lack enforceable accountability
Financial arrangements that don’t align to regulatory safe harbors
Delegated models with unclear oversight and documentation
Provider agreements that wouldn’t withstand federal scrutiny

Yet these contracts are actively driving:

Medical spend
Referral patterns
Network design
Revenue models

This is not a small risk. 

This is enterprise-level exposure hiding in plain sight.

The Cost No One Is Measuring

When contracts are invalid or misaligned, the impact is not just regulatory:

Paying for services without enforceable value
Incentivizing utilization without accountability
Losing leverage to manage cost and quality
Creating downstream exposure across every claim

What looks like “medical trend” is often something else entirely:  

A contract problem masquerading as a cost problem.

The Organizations That Will Get Ahead

Some organizations are starting to act—before they receive that letter.

They are:

Pressure-testing contract structures against federal scrutiny
Revalidating financial relationships and incentive models
Identifying agreements that create exposure before regulators do
Quantifying the financial impact tied to contract risk

Not because they want to. 

Because they have to.

The Question No One Is Asking—But Should Be

If regulators reviewed your top 20 provider contracts tomorrow:

Would they hold up?

And if they don’t:

What happens to the payments tied to them?
What happens to your network?
What happens to your financial model?

Final Thought

Most organizations are preparing for audits of what they’ve done.

Very few are preparing for audits of what they’ve agreed to.