The Complete Guide to Healthcare CLM Software
Dec 21st, 2022
The cost of healthcare has been rising at an alarming rate, increasing pressure on hospitals, physicians, and other providers to reduce costs and improve efficiency. One area the healthcare system can achieve significant savings is through better healthcare CLM software.
This guide will explore why healthcare contract management is critical for the healthcare industry and some best practices for implementing a successful contract management program.
- Healthcare contract management manages contracts between providers and vendors, suppliers, payers, and other third-party organizations. It monitors and enforces contractual obligations throughout the life of the agreement.
- Healthcare contract management is critical for organizations in the healthcare industry as it helps ensure compliance with regulatory requirements, reduces costs, and improves efficiency.
- As technology continued to improve and new regulations such as HIPAA and Stark law passed into effect, contract management in healthcare underwent significant changes.
- There are several best practices organizations should follow for better healthcare contract management, including the creation of clear policies and procedures for negotiating and executing contracts.
- When evaluating healthcare contract management systems, look for a system that facilitates electronic signature capture and generates automated notifications when a party violates deadlines or contractual terms.
What is Healthcare Contract Management?
Before focusing on healthcare, let’s explain contract management (or contract lifecycle management.) Contract lifecycle management (CLM) is a comprehensive approach for managing the entire lifecycle of a contract, from initial negotiation through its eventual expiration or renewal. CLM includes processes and procedures for negotiating, approving, executing, monitoring, and terminating agreements.
Healthcare contract management manages contracts between providers and vendors, suppliers, payers, and other third-party organizations. Healthcare contract management not only involves negotiating terms before signing a contract but also monitoring and enforcing the contractual obligations throughout the life of the agreement.
Healthcare contract management requires excellent attention to detail and knowledge of healthcare regulations and applicable laws (e.g., HIPAA). Healthcare contract managers must also ensure that all contracts are legally binding and enforceable. Furthermore, they must be aware of changes in laws and regulations, which may impact the healthcare industry.
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Why is Healthcare Contract Management Critical?
Healthcare contract management helps ensure compliance with regulatory requirements, reduces costs, and improves efficiency. The right contract management system makes it easy to track contractual obligations and identify areas to save money.
Healthcare contract management also helps improve patient outcomes by providing a framework for providers to follow when determining services, fees, contracts, and other aspects of the healthcare industry.
Contract lifecycle management also enables organizations to address potential issues before they arise. For example, suppose a healthcare provider has an agreement with a supplier to receive specific medical supplies at a reduced rate. Contract management allows the organization to track changes in the agreement terms easily and ensure the supplier meets their contractual obligations.
Finally, contract management is vital in developing new healthcare services and products. Healthcare contract managers can help to identify gaps in current services, negotiate favorable rates for existing products and services, and provide guidance on developing new strategies and solutions. This ensures that healthcare providers can adequately assess and deliver innovative healthcare services and products.
We can’t overstate the importance of healthcare contract management. All healthcare organizations need it to keep their operations running smoothly and cost-effectively.
A Brief History
Historically, in the healthcare industry, tracking contracts and keeping all agreements’ physical documents was mostly a manual process. As technology advanced, healthcare organizations began to recognize the importance of better managing their contracting processes. They started using electronic filing systems and standardized templates to ensure contract accuracy and consistency.
In the mid-1990s, software programs designed for healthcare contract management started becoming available, allowing organizations to store and track contracts more efficiently. As technology continued to improve and new regulations, such as HIPAA and Stark law, passed into effect, contract management in healthcare underwent significant changes.
Today, contract management in healthcare is a highly sophisticated process involving many stakeholders, from administrators to IT professionals. Healthcare organizations can now manage their contracts more effectively and efficiently.
Healthcare CLM Software Best Practices
With healthcare CLM Software, there are several best practices that organizations should follow. These include:
- Creating clear policies and procedures for negotiating and executing contracts
- Developing and utilizing templates for standard contracts
- Establishing a process for tracking deadlines and contractual obligations
- Using software to automate the contract management process
- Regularly reviewing contracts for accuracy, compliance, and potential opportunities
- Maintaining accurate records of all contracts to identify changes or discrepancies quickly
What to Look for in Healthcare CLM Software
As previously mentioned, a best practice in healthcare contract management is to automate the contract management process with software.
So, how do you know what’s the best software? Look for a healthcare contract management system that:
- Facilitates electronic signature capture
- Offers the ability to store documents securely and search quickly
- Generates automated notifications when a party violates deadlines or contractual terms
- Automates workflow processes for contract approval and routing
- Integrates with other enterprise systems to provide visibility into contractual data
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Healthcare contract management is an essential part of the modern healthcare organization. With the right processes and technology, organizations can maximize efficiency, reduce costs, and ensure compliance with regulatory requirements. This guide provided a comprehensive overview of healthcare contract management, including its history, best practices, and critical features to look for in a contract management system.
By following the principles outlined here and leveraging the right technology, organizations in the healthcare industry can optimize their contract processes and maximize value.
Streamline Your Healthcare CLM software with ContractLogix
Contract Logix is a leader in healthcare contract management, offering a comprehensive suite of tools and features to help organizations manage contracts throughout their entire lifecycle. Contract Logix offers:
- Automated workflow capabilities for faster contract approvals
- Robust document storage and search capabilities
- Electronic signature capture for easy authorization
- Regulatory compliance tools to ensure contracts are compliant
- Integration with other enterprise systems for more comprehensive visibility into contractual data
With Contract Logix, organizations in the healthcare industry can streamline their contract processes and optimize value from every agreement.
Schedule a demo today to see how we can facilitate your healthcare CLM software.
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