It’s been a big year for payer contract negotiations at Brentwood, Tenn.-based Ardent Health, CFO Alfred Lumsdaine said on the system’s Nov. 5 earnings call.
“Not every year is created equal, and 2026 had an inordinate number of key renewals, some we continue to work on,” Mr. Lumsdaine said.
Most of that work is now behind the system. Ardent is 85% contracted for 2027 and 75% contracted for 2028, he said.
“If I had to characterize our negotiations, they’ve been a little more contentious as we have been able to utilize transparency data to really ensure that we’re being paid appropriately in the markets for the work that we’re doing,” Mr. Lumsdaine said.
The approach is part of a broader rebuild of Ardent’s payer strategy. Dave Caspers, who was named president and CEO in June after serving as COO, told investors the system is taking a more disciplined, data-driven approach to contracting aimed at improving reimbursement rates, optimizing contract terms, enhancing revenue cycle yield and building more sustainable payer relationships. Mr. Lumsdaine described an “intense market-based focus” on recontracting to improve yield.
Mr. Lumsdaine said results from Ardent’s other renewals this year have been consistent with what it achieved in New Mexico. In May, Ardent’s Lovelace Health System reached a four-year agreement with Blue Cross and Blue Shield of New Mexico ahead of a June 1 deadline that could have dropped its providers from the insurer’s commercial and Medicare Advantage networks. Mr. Lumsdaine also credited a team the system restructured in 2026.
“We’re real proud of that team that was reconstituted into a revenue integrity unit this year, and the results they’ve achieved,” he said.
Tougher contracting has not eased every pressure on the payer side of the ledger. Denials remain elevated, Mr. Lumsdaine said, though final denials improved modestly compared with the third quarter of 2025.
Ardent’s payer mix is also shifting. Exchange admissions fell 7% year over year in the quarter, while self-pay admissions rose by a similar amount, and non-exchange commercial admissions remained down year over year, though they improved from the second quarter. Ardent sized the exchange impact at $35 million coming into the year, and Mr. Lumsdaine said performance has tracked closely with that estimate.
Not all of those patients are losing coverage altogether. When Ardent reviewed exchange patients it treated in both 2025 and 2026, a majority returned with other coverage, either through a commercial plan or Medicaid, Mr. Lumsdaine said. He expects much of that population to continue finding other coverage as exchange attrition carries into 2027, though Medicaid work requirements will add a new headwind next year that he said is too early to quantify.
Ardent recorded operating income of $81 million (5% operating margin) during the third quarter, up from an operating loss of $2.2 million (-0.1% margin) during the same quarter last year. The system also raised the low end of its 2026 adjusted EBITDA guidance to $500 million from $485 million.
