Outsourcing to a third party vendor can be a daunting task for some healthcare organizations. Oftentimes internal resources are limited and it can be difficult to properly evaluate third party vendors let alone manage an ongoing partnership.
Moreover, the richness and uniqueness of the data sent between both parties (health plans, doctors, hospitals, and other patient information) makes this type of vendor partnership vulnerable to data breeches.
Though healthcare organizations are investing time and effort to advance their vendor management, they have a long way to go to improve security measures and mitigate risks. Below is an overview of the 5 best practices used by healthcare organizations to improve vendor management.
5 Best Practices to Improve Vendor Management
- Risk Analysis
Vendors are, in essence, an extension of your organization. Therefore, it is important to understand the risk tolerance of each vendor. Different vendors pose different levels of risk, such as information security risk or reputational risk. These risks need to be assessed and categorized, and vendors need to be ranked accordingly (e.g. high risk, or moderate risk, or low risk. This is especially useful when determining appropriate due-diligence processes for each vendor.
- Contractual Obligations
With HIPAA and HITECH becoming increasingly stringent, healthcare organizations are doubly obligated to make sure that contracts are spelled out and there is no room for ambiguity. If services are further subcontracted, accountability needs to be clearly documented downstream. Each party needs to state their requirements along with any additional requests clearly.
- Due Diligence
Healthcare organizations that take the time to conduct proper background checks on each vendor are more likely to build trustworthy relationships. Effective due diligence requires healthcare payers and providers to collect and analyze data on things like vendor reputation, government dealings, past convictions, payment accounts, etc. This makes it critical to adopt a comprehensive program for vendor due diligence and oversight. Organizations with a robust program for vendor due diligence are able to gather sufficient risk intelligence and insight to mitigate vendor risks and protect their businesses against potential threats.
- Continuous Monitoring
While it is important to have a robust vendor research program, it is equally important to monitor the effectiveness of that program continuously. Continuous monitoring ensures that information gathered during audits, inspections, and other due diligence assessments is up-to-date. Assessment results are helpful in identifying risk during that timeframe, it might not be helpful in verifying and validating it over an extended period of time as new risks, controls, and vulnerabilities emerge. For a new relationship, a quarterly review process would be ideal, and as the vendor relationship strengthens, reviews can be semi-annual or annual.
- Leveraging Technology
An integrated technology solution can be extended across the healthcare enterprise to unify all vendor-related processes in a common framework. The technology solution should integrate components of information management, compliance, risk, audit, performance, and issue remediation for vendors. This kind of integration enables healthcare organizations to collaborate easily with vendors, and gain greater visibility into risks, ethic violations, and issues. Technology can streamline end-to-end vendor due diligence processes, creating greater accountability, and driving optimal resource utilization. Technology can also link vendors with a product, service, asset, risk, policy, process, or function to detect non-compliance incidents early and proactively work to avoid further damage.
Vendor management enables organizations to control costs, drive service excellence and mitigate risks to gain increased value from their vendors throughout the deal life cycle. But what if you, like so many other organizations are tight on internal resources and cannot perform these best practices? There is another alternative.
"Couldn't be more pleased with the product or service. Innovative, comprehensive, but simple. Can't imagine vendor relationships without it."
- VP Financial Performance
Welcome to BlueLyte Solutions, a company excelling at vendor management within the healthcare industry. With almost a century of healthcare finance experience, BlueLyte offers a holistic set of revenue cycle tools designed to reign in vendors, tighten compliance, and drive revenue beyond expectation.
C-Level Health Executives, technology experts, and entrepreneurs specializing in process perfection and performance maximization make up the BlueLyte team.
BlueLyte works cooperatively with Health Systems and revenue cycle vendors to increase financial performance and reduce the ultimate cost to collect, all at the same time.
Using a proprietary analytics and vendor management platform, BlueLyte builds a clear line of sight to the revenue cycle/vendor landscape leading to actionable analytics, razor sharp reporting, and standardized audited invoicing.
BlueLyte helps to showcase strong performers and provides the ultimate tool to push performance throughout the revenue cycle operation. Their platform rides the rails of existing data exchanges and requires absolutely no IT resources from the healthcare organization.
When discussing vendor management within your organization, it is important to consider the question of outsourcing. You should consider all of the best practices mentioned here, and whether your organization has the time and resources to do them all. Should you choose to go with outsourcing, be sure to choose a reputable partner, such as BlueLyte.
To learn more about BlueLyte Solutions services click here.