In a recent Black Book survey, 96% of CFOs, financial management, and supply chain leaders stated they have no contract management system, are using all manual processes, or have a system that is outdated and inadequate. Failing to have automated contract management systems is costing provider organizations $157 billion collectively each year, Black Book reported.
Further, “The majority of US health systems are struggling with manual contract tasks and fragmented contract processes,” stated Doug Brown, managing partner of Black Book, “But value-based reimbursement is forcing executives and leaders to reconsider healthcare contract management workflows,” he said. Here are four additional reasons why provider organizations are making contract management automation mission critical:
- Enhancing negotiation strategy: If you have all the facts (e.g. performance, utilization, benchmarks, etc.) at your fingertips, you can negotiate from a position of strength.
- Automating contracting tasks: A simple task of identifying the total dollars under contract could take hours to calculate manually, while an automated contract management system could give you this information with a few clicks of your mouse.
- Minimizing contract risks: If you miss a contract renewal date or fail to act on a contract requirement it could cost your healthcare organization thousands in lost revenues. Never miss a contract renewal date again with an automated system.
- Enabling full audit tracking: To audit a manual contract management system could take weeks. Then again, an automated contract system audit could only take a few hours.
When you consider that a typical system or IDN has billions of dollars under contract to administer in any given year, it is malfeasance not to treat them as valuable assets. As such, establishing one single automated contract management system platform to effectively and efficiently manage and administer these contracts in a value-based world is now mission critical. And in the long run it will boost your healthcare organization’s bottom line.
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