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Automating Healthcare Contract Management Improves Business Ops

OB Hospitalist Group consolidated over 200 physician, vendor, and payer agreements into a single contract management system to streamline and improve its business operations.

Healthcare contract management and business operations

Source: Thinkstock

By Jacqueline LaPointe

- Improving care access at hospitals is key to ensuring the health of pregnant women and their babies. But the business operations behind improving care access, such as employee and vendor contract management, must be as efficient as possible to support physicians and their care teams on the clinical side.

This was the case at OB Hospitalist Group (OBHG) in South Carolina. The organization operates 130 active and onboarding hospitalist programs across 30 states to ensure pregnant women can access hospital care regardless of busy OB-GYN schedules.

Contract management is a major component of running hundreds of programs in hospitals with over 600 clinical employees. OBHG not only negotiates agreements with physicians to provide clinical services, but the organization enters contracts with vendors for professional services and payers for reimbursement.

Despite entering and maintaining a myriad of contracts with physicians, vendors, and payers and earning a 97 percent contract renewal rate, the organization engaged in manual contract management processes up until recently, Regina Flint, Contract Manager and Paralegal at OBHG, recently explained to RevCycleIntelligence.com.

“What I found when I started at OBHG was a list of contracts maintained on an Excel spreadsheet and housed on one of our internal servers, which most employees can access from their system,” she said. “However, there was not a consolidated location where someone could review specifics about the contract, such as its terms and conditions, and obviously, maintaining on an Excel spreadsheet did not have an electronic notification feature when something occurred with that contract.”

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Without a consolidated system for contracts and agreements, each OBHG team member owned his or her own spreadsheet of contracts. Team members manually performed key contract management tasks, such as auditing, regulating, and administering, with the contracts he or she tracked.

The manual process also meant that the organization could have multiple contract types with the same name, but different workflow approvals, Flint added.

She partnered with the organization’s general counsel to pitch the idea of a contract management system that would serve as a repository where all the contracts would be held. After sampling several systems, OBHG decided to implement Agiloft’s contract management system that brought physician, vendor, and payer contracts, as well as asset management, under a single platform.

Implementing one system that could hold over 200 contracts was critical to ensuring OBHG team members could access the contract provisions and items they needed to streamline business operations and provide timely support to OB-GYN physicians.

“There's different aspects of the contract that different departments will need to have,” Flint stated.

READ MORE: What Is Healthcare Revenue Cycle Management?

For example, the contract owner may regularly need term language and renewal provisions to manage and administer the agreement. But other departments should also have easy access to the contract. The legal department may need to access information regarding indemnification and warranty clauses, whereas the finance and accounting department may need to check contract prices for budget purposes.

Various team members across departments require contract information to streamline business operations and provide services to program hospitals. Spreadsheets were not an ideal method for maintaining hundreds of contracts, especially when multiple departments need access to the agreements.

Under the manual approach, team members had to send the contract management spreadsheet to other employees who needed information. Sharing in this manner significantly increased the risk of errors and missing information.

Using a consolidated system permits team members to access the actual contract or agreement, not just a spreadsheet designed by a team member with other priorities.

Flint also sought a contract management solution that notified contract and agreement owners of any changes to the contract and expiration dates.

READ MORE: Key Ways to Improve Claims Management and Reimbursement in the Healthcare Revenue Cycle

“It is very important for the contract owner to receive notifications about what's happening with their contract – just in case it fell off their radar,” she said. “Such as if there’s a termination for convenience provision, or if the agreement automatically renews unless someone does something. Or, the company’s needs may have changed and we no longer need this vendor or this service.”

With the notification system, contract owners can now make more informed business decisions because the system alerts them to upcoming changes with the agreement. The system reduces the risk of contracts renewing at the same terms as the original agreement even though the organization’s needs for those services changed.

Notifications also help contract owners to know when to terminate a contract for services no longer needed to provide care at participating hospitals. OBHG could avoid an early termination fee by not canceling the service after the contract renewed.

“The notification feature is one of the most important tools because it keeps you abreast of what's going on,” she emphasized.

Through the automated contract management system, OBHG was able to not only streamline its business operations, but support the clinical staff and programs the organization operates across the country.

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