Wednesday, July 2, 2014

Healthcare Contract Management and the Impact of Hospital Mergers

Mergers in Healthcare are becoming very common.  Healthcare consolidation has been on the rise lately with little sign of slowing down. The industry's merger and acquisition activity increased by almost 20 percent in the third quarter of 2013 compared with the same quarter a year ago, with 267 deals announced in the past three months, according to Irving Levin Associates. (Source: Becker’s Hospital Review)

While a merger can make great financial sense, it often results in a loss of institutional memory that walks away with the reduction in staff.  A merger may also result in some promotions of existing contract managers and promote them.  Again, an organization can experience loss of knowledge and expertise.

One way to mitigate pain and loss in the transition is the effective use of a strong healthcare contract management system.   Our experience tells us that having the following components will make the transition rewarding and retention of the hospital contract management knowledge successful:

  • Well defined healthcare contract management contract types.  Each type should clearly specify the unique data to be captured, what is required, optional and default values.
  • Strong journal of all transactions and the history of any change, comment and notification regarding an agreement.
  • Defined alert system as well as a work flow and signing approval  for each contract type.
  • Ability to transfer “in mass” responsibility of a group of contracts from one person to another.  (Note:  one should perform a check on all alerts to identify any email addresses that are no longer valid due to reduction/change in staff or change to email addresses)
  • Reporting system to review, report and identify any potential concerns.
  • If you have a hosted contract management system (sometimes called SaaS or Cloud), you will eliminate one of the many challenges that the IT team often faces.

You will still experience pain with almost any merger or acquisition.  However, having the above in place for your contract management system will minimize the loss and ease the transition.

Learn more about Contract Guardian by calling 513.977.4544 or request a demo

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