Do you really need all those sets of eyes on that contract? Who’s just being nosy?

Contracts are a critical component in the business of healthcare.

As healthcare systems continue to become more complex, they face intense cost pressures.

Contracts are legally binding agreements between two entities that outline the agreed-upon services, reimbursement arrangements, and legal considerations within the healthcare organization. It is natural for a healthcare organization to manage and administer large volumes of varying contract types for different contract locations that affect the various aspects of their business. Because contracts affect multiple facets of a healthcare organization, there is a tendency to have “too many cooks in the kitchen” when it comes to the contracting process.

Different key individuals may be responsible for varying contract types. One misconception that delays contract processing is the idea that every stakeholder must look at the contract at every stage of the contracting process. But potential stakeholders can include a vast array of people such as business process development teams, providers and clinicians, compliance and legal departments, human resources, finance, vendors, community partners, and many more.

According to Aberdeen Research, the average time it takes to finalize a contract is 20–30 days after the initial sourcing cycle is complete. Traditionally, any individual within the healthcare organization can route contracts through the review and signature process. Routing is normally done through the passing of paper documents or email, based on the healthcare organization’s processes. When you route contracts manually, there are limitations to knowing where the contract is in the process, whose desk it is lying on, or whose inbox it is buried in. When you have more eyes on the contract than necessary, you are likely to increase the number of days it takes to create, negotiate, and finalize the contract because it increases the number of desks and inboxes it needs to pass through.

Ideally, each step of the contracting process should involve only the people responsible for taking action on the contract to usher it to the next step. Anyone who is viewing the contract “just to have visibility” or because they are listed as a stakeholder for the overall process might just be a bottleneck. To help decrease the time it takes to finalize a contract, contract administrators should be able to provide visibility into the contracting process through reports and dashboards without granting access to people who could manipulate the contract terms or delay the process. Reducing the number of individuals making updates to the contract and allowing only those who have decision-making authority to take action is critical to streamlining the contracting process. Providing administrative support throughout the lifecycle is vital to ensuring that reviews, approvals, and signatures take place in a timely and appropriate manner.

RELATED WHITE PAPER: The Process Revolution – Advancements in Healthcare Contracting

To reduce the number of cooks in the contracting kitchen, it is critical to identify a single person or department who is responsible for overseeing the actions within each contracting phase. By doing so, the organization can streamline the process, helping to reduce the number of people touching the contract, which also reduces the total cost and time involved in contract administration. Another way to help control who views the contract is to automate the contracting process.

Automating contract workflows allows you to assign the key individuals to view and negotiate contracts at the appropriate times. When you automate the workflow process, you can ensure that the right individuals receive notifications so they can view the contract and complete the required steps to move the contract forward in the process. When you eliminate the extra pairs of eyes and restrict the number of nosy neighbors peeping at your contracts, it allows your healthcare organization to avoid costs, mitigate risk, and decrease time spent on contract administration, increasing the capacity to focus on other areas of the business. Visit TractManager to learn about how our Contract Lifecycle Management solution can automate and streamline your entire healthcare organization’s contracting process.

Author:

Hanna Lee

Senior Learning & Development Specialist

Hanna Lee joined TractManager in 2018 as a Senior Learning & Development Specialist.

 

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TractManager’s Contract Analytics tool helped a Northeast U.S. academic teaching hospital analyze 6,000+ contracts in six weeks instead of two years, saving $600K in staff salaries.

TractManager’s Contract Analytics tool helped a Northeast U.S. academic teaching hospital analyze 6,000+ contracts in six weeks instead of two years, saving $600K in staff salaries.

Manually reviewing the overwhelming volume of data contained in your contract assets to ensure compliance is a daunting and incredibly time-consuming task, which most organizations do not have the time or resources to undertake ...

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