Why Healthcare Contract Management Needs Software
Contracts are a key part of all organizations, no matter the industry or niche. Without contracts and legal documents, operating any type of business would nearly be impossible.
The same is true when it comes to healthcare, and this is why automating healthcare contract management is so crucial.
Contracts are a key part of the hospital and healthcare industry, with most medical facilities dealing with up to thousands of contracts per day. A lot of these contracts play a vital role in the health of others’ lives, so the importance of medical contract management software cannot be understated.
Having a proper healthcare contract management software and system in place is not a luxury but actually a necessity.
The Main Types of Healthcare Contracts & Challenges
As mentioned, healthcare facilities deal with a surplus of contracts that contain sensitive information and carry the weight of patients’ lives each and every single day.
The 5 Most Common Types of Healthcare Contracts
The main types of healthcare contracts include:
Physician Employment Contract
This type of healthcare contract is used when a physician is newly employed at a hospital or medical facility.
It is basically an employee/employer contract, but for physicians.
This healthcare contract will include such details as:
- pay rate
- termination rules
Physician Recruitment Contract
This healthcare contract is similar to a physician employment contract.
With a physician recruitment contract, the medical facility details their terms for physician recruitment.
In other words, the hospital or healthcare provider lays out how they handle job referrals.
Management Services Arrangement
This type of healthcare contract is used by medical facilities to outsource management services.
Typically, this includes any non-medical staff that can be provided by a third-party management services company.
The positions usually involved with these contracts include:
This is an important contract as hospitals and other healthcare providers rely on these positions to operate.
Medical Directorship Arrangement
This contract is used when a physician starts a position at a health facility that is more administrative-related than medical-related.
The typical tasks a physician might perform in a role that requires a medical directorship arrangement includes:
- training employees
- developing policies
- helping enforce guidelines
This contract is used when a physician is promoted to a more ‘managerial’ role in a hospital or medical facility.
This type of contract is used between medical facilities when a patient is to be transferred from one location to another.
A very common healthcare contract, this document requires ultimate legal compliance, witnesses, and of course, signatures. Considering that this contract involves the wellbeing of a patient, it is very important.
Typical terms included in a transfer agreement include:
- length of care
- insurance info
- duties (for the next hospital staff)
- terms of termination
- payment info
Healthcare Contract Management: Challenges
Common healthcare contract management challenges include:
- Poor standardization (differences from contract to contract makes it difficult to accurately manage various contracts).
- Weak transparency (whether it’s facility-to-facility or completely internal, a lack of transparency and communication results in missed deadlines and loss of revenue).
- Ineffective management (not managing key dates and scheduled payments properly can compound into a large loss of revenue).
- Vendor issues (vendors are not always on time or miss certain dates, and without proper contract management this can lead to loss of revenue).
How to Manage Healthcare Contracts Effectively
Healthcare contract management best practices vary, but one thing is for certain – medical contract management software works to fix all the common challenges and allows for a better experience for everyone involved, including staff and patients.
How Healthcare Contract Management Software Helps
Automating healthcare contract management by using contract management software helps medical facilities manage healthcare contracts in a way not possible otherwise.
Medical contract management software helps healthcare providers:
- Standardize the contract process (the entire contract lifecycle is streamlined – every contract is made and executed the same way, and this is ‘enforced’ by the software).
- Automate contract workflow (the software automatically sends and alerts relevant personnel when any action is required of them – also, renewals and expirations are alerted as well).
- Ensure compliance (contract management software prevents any legal obstructions taking place within the contract creation process, and helps users easily manage their obligations).
- Allow for quick contract creation (with help from the software, creating new legally-compliant contracts can be done with only a few clicks).
This solves all of the challenges that arise from traditional healthcare contract management.
Benefits of Medical Contract Management Software
Healthcare contract management software helps medical facilities solve many of the challenges that arise from traditional contract management.
In an industry that deals with an immense amount of very complex (and sensitive) contracts, the need for automating healthcare contract management is essential.