Solutions for Negotiating Contracts With Vendors
At VIE, we understand the challenges hospitals face when negotiating with highly skilled vendors.
We help healthcare organizations maximize contract performance by:
- Identifying cost savings in vendor and GPO agreements to drive margin improvement.
- Optimizing your hospital contract terms and conditions to support negotiations.
- Equipping hospital employees with negotiation skills to secure best terms and pricing.
- Negotiating with vendors to achieve cost savings for your hospital.
We work with hospitals to deliver high performing contracts for long term cost savings.
Call VIE at 1-888-484-3332
Why Hospital Contract Negotiation Matters
A well negotiated agreement ensures effective healthcare contract management and optimizes pricing. Negotiating cost effective supply agreements is a challenge for most hospitals who often pay excessive prices for critical supplies.
Hospitals also face challenges in contract negotiations with GPOs and often do not realize they can bypass GPOs to get the best pricing for their organization.
Without a solid strategy, hospital leaders are unlikely to secure best pricing and contract terms for their hospital.
Learning how to negotiate with vendors and GPOs equips your team with vital skills to overcome their sophisticated strategies and secure best pricing for the duration of your contracts.
Being aware of how vendors increase their margins helps your hospital when it comes to negotiating.
6 Ways Vendors Increase Their Margins
- Vendors change their list price book every year.
- Pricing committees.
- Tiered pricing structures.
- Utilizing GPOs.
- Using rebates versus giving invoice pricing.
- Making minor enhancements to products.
How to Negotiate With Vendors to Save Money
- Reviewing your vendor contracts and purchased services agreements.
- Identifying hidden cost savings available in your line item invoices.
- Carrying out an indepth analysis of your contract terms and conditions to optimize contract performance.
- Role plays of real life situations to teach staff specific negotiation tactics.
- Individual and team based “practice sessions” to reinforce training principles.
- Development of key negotiation metrics to fit the unique needs of your organization.
- Education on the latest innovations available in medical technologies and supplies.
- Actionable game plans to recover money lost from poor negotiation.
5 Essential Elements of an Optimized Contract for Maximum Cost Savings
Understanding the essential elements every healthcare contract needs helps hospitals to adopt a ‘’get it right first time’’ approach and secure the best possible terms and pricing for cost management.
Include our 5 essential elements for cost effective vendor negotiations and margin improvement:
- A maximum contract term of 3 years. Locking your hospital into any term which exceeds 3 years potentially locks you out from better pricing.
- Flexibility in contract structure: Healthcare is a changing environment requiring flexibility in agreements.
- Commitment levels: Minimum levels may result in your hospital paying for services it does not use. Carry out a line item analysis and review your historical utilization.
- Payment due dates: In areas like telecommunications, hospitals can incur 18% per year in late payment fees. Consider payment terms of 45 to 60 days.
- Error corrections: Vendor agreements may include clauses for identifying and correcting billing errors within 30 to 60 days. We recommend their removal to ensure refunds are made irrespective of when errors are identified.
The value of accurate data and information is vital in hospital-supplier negotiating.(1)
Obtain a 12 month invoice sample to accurately evaluate the proposal offered by the vendor.
VIE Healthcare® identifies areas for cost savings with our unique Invoice ROI™ Purchased Services Technology.
Our team of experts dig deeper than the average AP spend and compare market pricing and market trends to identify where the opportunities lie for our clients.
Work with VIE Healthcare® to enhance your contract performance and save your hospital money.
Our hospital contracts solutions include:
- Identifying the hidden cost savings in your agreements with our automated technology Invoice ROI™.
- Finding hidden pricing errors and off-contract items that are costing your hospital money.
- Equipping your team with advanced negotiation skills to achieve best pricing and contract terms for the duration of your contract.
- Negotiating with vendors to secure cost savings on your behalf.
Key Takeaways
- Contract terms limiting the time frame for vendor refunds should be removed.
- Hospitals can bypass GPOs to get the best pricing and drive margin improvement.
- Every healthcare organization can learn techniques to negotiate best contract terms and pricing.
- Understanding the 6 ways vendors increase pricing helps you to identify cost saving opportunities.
Optimize Vendor Pricing, Negotiate Optimal Contract Terms and Save $$$ with Hospital Contracts Negotiation Expertise From VIE Healthcare®.
Get started with our Healthcare Negotiation Experts today. Call VIE at 1-888-484-3332