Management of Purchased Services Contracts is the Largest Cost Savings Opportunity for Hospitals Today.
Here’s our 6-part process to achieve unparalleled cost savings in purchased services spend:
- Forensic Line-Item Historical Analysis: Analyzing 12 months’ invoices and getting the line-item details.
- Detailed Contract Dissection: Understanding the complexities of the contracts.
- Categorization & Benchmarking: Benchmarking based on line item details.
- Cost Savings Opportunity Identification: Developing a complete cost savings opportunity analysis.
- Contract Re-Negotiation: Creating a well-crafted pricing strategy that will be successfully negotiated.
- Manage Contract Performance:Put a disciplined process in place to manage each contract’s performance with line item spend focus.
Here are 2 mistakes we often see organizations making:
- Getting into benchmarking without first performing the line-item analysis and understanding the contracts.
Those steps are crucial for accurate benchmarking. - Not managing the contract after it’s put in place.
By managing between the contract signing and the end of the contract, you get a deeper level of cost savings and keep your cost structure optimized.
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Introducing VIE Healthcare
We Deliver Spend Analytics
Spend Analytics combines deep line-item forensic analysis of historical spending with benchmarking, categorization, and contracting to optimize your purchased services spend fully
The VIE Healthcare Advantage -
The Only Comprehensive Cost Savings Solution™
What would a perfect purchased services cost savings be capable of?
Hospitals and healthcare providers regularly rely on the contract management process. A contract management solution can help with the contract review process and conduct line item analyses to assist with approvals, denials, acquisitions, and other significant transactions. This empowers you to leverage risk management and spend analysis to determine where you’re paying too much and where you need to invest more resources.
Often, when you’re trying to improve the operational efficiency of healthcare organizations, it’s important to use healthcare contract management services or contract management software. The United States healthcare contract management software market is diverse and offers numerous solutions. As such, you need to choose the appropriate contract management software for your needs. Your contract management software should extend beyond simple e-signatures, clause edits, and templates. Any healthcare contract management system or partnership should be able to help with several use cases. It could:
- Analyze every line-item detail of your historical spend
- So you could understand every opportunity for cost savings. Health systems need to find ways to reduce spending to reinvest capital in operational efficiency processes, account for underpayments, and seek reimbursement for overpayments.
- So you could know exactly what you are spending and what you need to contract for. When healthcare providers implement contract management systems, these can act as a healthcare contract repository. You can review payer contracts, analyze the entire contract process, and learn about workflow improvements that can boost your bottom line.
- Deliver an experienced, thorough analysis of your existing contracts to identify areas of cost savings further. When healthcare providers can identify cost-savings opportunities, they can better adhere to healthcare industry best practices and navigate different contract types. In addition, Healthcare contract management software empowers clinics, payers, and service providers by acting as a contract guardian that satisfies regulatory requirements.
- It could be able to perform this analysis quickly. So you can start achieving cost savings in days and weeks and not months and years. Other contract management system tools don’t empower healthcare providers with quick alerts to implement immediate changes. With the right contract management system, you can more closely adhere to developing healthcare regulations, improve patient care standards, and avoid overspending during any contract process.
To reduce your hospital’s purchased services spend, you must adopt new and innovative practices for cost reduction, which include:
Reconciliation of your line item service invoices.
Identification of cost reduction opportunities through price and cost benchmarking.
Extensive contract reviews for a complete understanding of financial and operational costs.
Data driven analytics and spend analysis from your invoice details.
- VIE Healthcare’s patented technology gives you the complete picture of your purchased services spend so you can optimize cost savings.
VIE Healthcare has developed a patented technology that rapidly analyzes the full line-item details of every invoice from the past 12 months, giving you unparalleled insight into your actual historical spending.
Our technology allows us to go far beyond simple benchmarking or spot-checking. For example, we can determine where there have been over-charges, precisely what and how much of your spend is out of contract, and detailed areas where you can improve the costs beyond just at a macro-services level.
This complete detailed spend analysis would take weeks or months to do manually, but our software allows us to do it in days, at a very high level of accuracy.
- VIE Healthcare has proven deep, specialized expertise in the complexities of purchased service agreements, giving hospitals unrivaled insight into areas of potential cost savings.
Purchased services agreements can be highly complex. VIE Healthcare has specialized in analyzing spend related to purchased services for over 21 years, and our highly experienced analysts know precisely where to look for cost savings. We can help decipher the details of your current agreements, including minimums, maximums, bulk discounts, inclusions, exclusions, and more, and then map those to the details of your contracts, including amendments. Our expertise uncovers every area for potential savings.
- VIE Healthcare delivers cost savings in weeks, not months or years.
Our software helps us analyze your past data quickly to determine where the potential cost savings are fast.
In many cases, we identify historical over-charges that we can get refunded from vendors.
It doesn’t matter what system or process you use; if you don’t have automated visibility and access to your purchased services invoice line item details, you miss cost savings and overspending. Healthcare payers often can’t afford to overspend on contracts but can’t devote resources to manually reviewing existing contracts and payer information. As such, healthcare companies often struggle to choose the proper agreements and collect relevant data. With the growing need for efficient contract management system solutions, healthcare companies have to invest in leading platforms to find savings opportunities, increase their bottom line, and reinvest in patient care that exceeds federal regulations.
Your Hospital and Health Systems are Overpaying, at Minimum, Tens of Thousands of Dollars Due to Invoice Inaccuracy.
Since services are utilized then invoiced—your hospital depends on the purchased services vendor to invoice accurately. Yet, we see that greater than 30% of all purchased services invoices are priced incorrectly from the agreed upon contract terms, are not on contract, or have excessive extra fees added.
When invoices differ from contract terms, it impacts healthcare payers. Asking a healthcare company to parse old physician employment contracts, physician agreements, and EHR data is no small request, either.
Without ongoing contract management efforts, data reviews require someone from your hospital to manually review pages of invoices and hundreds of line items for accuracy and also utilization improvement opportunities.
As a result, many of the purchased services invoices do not get thoroughly reviewed with errors, and hospitals overpay each month.
In addition, as healthcare payers continue to overspend on managed services, contract inconsistencies, and fines, there’s a clear growing need for more robust ongoing contract management efforts. Coupled with new technology like machine learning and artificial intelligence, it’s easier than ever to maintain regulatory compliance, reduce administrative costs, and quickly review physician contracts to find savings opportunities.
VIE Healthcare’s Patented Purchased Services Invoice ROI™ Technology is Fully Automated and Reconciles Thousands of Line Item Details Instantly, Saving Hospitals Unnecessary and Significant Costs in Their Purchased Services Spend Caused by:
Excessive Fee Charges
Billing Errors
Manual Processes
Off-Contract Spend
Not only will you find and save money, but this will also eliminate your manual process so your team can work on strategic initiatives. In addition, contract management system healthcare improvements help you maintain greater financial oversight, manage all types of contracts, and develop more successful third-party partnerships across the healthcare marketplace.
With Invoice ROI™:
You can have a customized database that is based on vendor agreements.
Our technology makes sure line items match contract pricing and identifies overcharged items.
Within minutes, monthly invoices are reconciled.
We can help reduce your purchased service spend:
1. Automate line item reconciliation of your invoice transactional details to your contract using Invoice ROI™.
2. Identify cost reduction opportunities through price and total cost benchmarking. This can even connect you to the right contracts.
3. Conduct extensive contract reviews to understand financial and operational costs fully.
4. Provide you with data-driven analytics & historical spend analysis from the invoice details. When connected with your CMS, you can set up more effective patient pipelines.
5. Assess the performance of services provided to ensure value promised and paid for is being delivered.
In the below video, we show you how Invoice ROI™ was able to help one client who was overcharged 29% and saved over $10,000 from just one invoice from one vendor in one month.
To streamline your contract review process, select an effective healthcare compliance solution, mitigate potential risks, and develop more significant net revenue, contact VIE Healthcare Consulting. Our team can help you understand contract fees, fines, referrals, rebates, and regulatory mandates that can impact healthcare payers. In addition, with effective healthcare contract management software, you can develop more robust health system management templates and empower your brand.
Three Ways to Work with VIE Healthcare
- Benchmark a vendor contract – either an existing contract or a new agreement.
- We can support your team with their cost savings initiatives to add resources and expertise. We set a bold cost savings goal and work together to achieve it.
- VIE can perform a cost savings opportunity assessment. We dig deep into all of your spend and uncover unique areas of cost savings.