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3 Ways Contract Management Can Improve Healthcare Compliance
Healthcare contract lifecycle management can seem pretty cut and dry but, there’s actually more than meets the eye. In fact, in an independent study conducted by the International Association for Contract & Commercial Management (IACCM), suggested that poor contract management can cost organizations as much as 9% of their annual revenue. A pretty significant amount when you consider tightening budgets our facilities face nationwide, not to mention reports of bankruptcy.
It’s incredibly rare for an organization to look at their contracts management process as a means to save them money. However, as part of the sourcing process, it can be incredibly beneficial. This is especially true, or at the very least made easier, when the contract lifecycle is automated. Here are 3 advantages contract lifecycle management can bring to your hospital.
Negotiation Management
Having all your contracts in a centralized library makes it easier for your organization’s Contract Manager or Supply Chain Manager to review agreements, years of partnership, and the amount spent over the years to increase negotiation power. This is especially true for organizations with multiple systems, who can consolidate their vendors for greater buying power.
Spend Visibility
With a contract management system, you’ll finally have a top-down view of what your organization is spending, where it’s being spent, and even who is spending it–but most importantly where you can save. What’s more, having a centralized system allows your whole organization to make informed decisions on spending. No longer will it be a case where someone makes a purchase or signs an agreement without realizing an agreement already exists.
Contract Elimination
Without a contract management system to automatically alert contract managers of expiring agreements, contracts often go into auto-renewals, often at higher rates and sometimes locking organizations down for another buying cycle. Proper lifecycle management entrails having alerts set up weeks or even months in advance. Enough time to renegotiate prices or find a new vendor with more favorable terms.
The list of proper contract management, of course, extends itself to legal benefits as well. However, what your organization will always see first is the dollar and cents of it all. Now that you’ve realized what a simple step can do to help you make a huge impact on your organization it’s time for you to dig deep and take action.
Continue your journey with these helpful resources:
[Ebook] 10 Must-have Features to Look for in a Contract Lifecycle Management Solution
[Case Study] How LCMC Health Took Control of Contracts to Eliminate Missed Renewal Dates
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