The Farmer, the Devil, and a Better Bargain
The Brothers Grimm, Jacob and Wilhelm, were nineteenth-century German scholars who collected and published folk tales, including “Cinderella,” “Hansel and Gretel,” and “The Peasant and the Devil.” The latter tells the tale of a wily peasant farmer who, at the end of a hard day’s work, finds the devil sitting on a treasure near his field. The devil offers the treasure in exchange for half the farmer’s harvest for the next two years. The farmer agrees and proposes a specific division. Everything below ground will belong to the farmer and everything above ground will belong to the devil. The devil agrees.
The farmer plants turnips. At harvest, the farmer keeps the crop and leaves the devil with the withered leaves. The devil is furious and insists on reversing the arrangement for the second year. The farmer agrees, plants wheat and keeps the grain, leaving the devil with the roots.
At first, it is easy to see the bargain from the devil’s point of view. He has treasure and that seems to put him in a stronger position. But the apparent distribution of negotiating resources can obscure the value each party brings to the table. So, while the devil has money and power, he is buying a harvest he relies on the farmer to produce. The farmer, on the other hand, knows what to plant and which parts of a crop have value. The devil has the money, but the farmer understands the work. Consequently, the peasant farmer ultimately controls the deal.
In payer contracting, insurers enter the discussion with the literal treasure–the premium or claim dollar–and a base agreement drafted around insurance company business interests. The insurer is also typically supported by provider relations and contracting staff, lawyers, and data analysts. The agreement incorporates provider manuals, policies, and procedures the insurer wrote and retains the authority to change.
That is a substantial advantage to be sure, but like the peasant farmer, the practice is not powerless at the bargaining table. The practice delivers the care. Its clinicians build relationships with patients and families over time, so patient satisfaction, quality results, appointment availability, distinctive clinical capabilities, and limited patient alternatives are all appropriate examples of practice leverage.
I am not suggesting insurance companies are the devil in our story, far from it. But a parallel can be drawn to the apparent power imbalance at the negotiation table, and the consequence of miscalculating the other party’s value position in the relationship.
In actual practice, making a persuasive case for provider-friendly terms begins with understanding the existing offer. I read the agreement alongside the materials it incorporates (like the provider manual). I identify what the practice must do, what it should expect to receive, and where important questions remain unanswered. Then I want the payer to explain how the arrangement is supposed to work and to answer those questions. It is not uncommon to have more than two dozen questions for an insurance company following the review of an initial contract package.
Those questions lead to specific requests the payer can evaluate. A request for different terms needs to take the payer’s business seriously. Insurance companies, like all businesses, want to protect their financial interests. Their base contracts support how they operate, so asking for a change means asking the insurer to alter some part of its business. For that reason, requesting business or language preferences gives the insurer very little to evaluate. Contract change requests should identify a specific patient care or business concern, document its impact, and describe the proposed change clearly enough to support an internal decision. That doesn’t mean the insurer will cooperate, but progress is impossible based on preference alone.
A working relationship makes the negotiation process much more effective so remember to be patient and kind. There is enormous value in a payer partner who understands the practice and stays invested in helping to resolve its problems. Someone who can carry an issue through internal departments and discussions can make a meaningful difference. Those relationships matter long after negotiations end, too. An enrollment problem, recurring payment error, or conflicting instructions may require several people inside the insurer team to resolve it. A contact willing to see the issue through can keep it from starting over with each handoff.
And this is where the farmer’s victory becomes uncomfortable for me. He understands the terms but he willingly allows the devil to misunderstand them. The bargain delivers something quite different from what one party expects. The farmer’s practical knowledge is appealing, but his willingness to exploit misunderstanding gives us the wrong moral.
In my version of the story, the farmer asks the devil to explain what he means by half the harvest and each party clarifies what he expects to receive. They consider how the proposed division would work with different crops. The farmer lays out the labor and expense of producing them, the seed needed for another season, and the consequences of a poor yield. The devil recognizes having the treasure does not answer those questions.
They each listen, answer each other’s questions, and bring the discussion back to terms that make the arrangement workable. Eventually, they agree on a share of the usable harvest that gives the devil a worthwhile return while leaving the farmer properly rewarded for the work and able to plant again. They put their commitments in writing, and each understands what the other has promised.
That is an ending I would like to carry into payer contracting. The farmer secures a better agreement through competence and persistence, and the devil receives something his treasure alone could not produce. Both have a reason to make the arrangement succeed. The party holding the money will always have an advantage to speak of, but the party that produces the harvest has something substantial to bargain with, too.
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