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EHR Contract Negotiation

Cathey Halsten, EHR Advisor

July 13, 2011

Services of Iowa’s Regional Extension Center

Extension Center

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THE TRUSTED HEALTH IT ADVISOR

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IFMC HITREC Ground Rules

• We advocate for the provider• We are vendor-neutral (unbiased)• We do not purchase or install EHRs• Tools to help during selection process• Advocate for the practice

Steps to Reviewing EHR’s

1. Develop an EHR Selection Team2. Identify workflow issues, goals and timeline3. Create a short list of EHR vendors to review4. Ask for On-Site Demonstration5. Participate in EHR demonstration6. Ask for references and possible site visit7. Make an informed decision

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Step 1:

• Develop an EHR Selection Team (no matter how small you are)

• Representatives should include:– Providers– Clinical Staff– Office Staff

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Step 2:

• Create a short list of EHR vendors– IFMC short list - a great place to start– Research EHR functionality as it pertains to your

workflow issues– Talk to peers using EHR’s

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Step 3:

• Prepare for EHR demonstrations– Remote and/or on-site demos?– Ensure the selection team participates– Prepare a few workflows– Set aside uninterrupted time for demos– Use evaluation tool

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Step 4:

• Participate in EHR demonstration

1. View vendor’s sales demo2. Ask to see the workflows you identified3. Have them elaborate on features and

functions that are important to you4. Ask for references 5. Consider onsites

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Step 5:

• Reference checks and On-site visits– Prepare a list of questions– Visit clinics and talk to users– Remember vendors will always provide their

best references

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Step 6:

• Make an informed decision– Rank the vendors based on the evaluation tool

and references– Select two finalists– Ask them for a contract to review– Keep track of any issues you may

want to negotiate

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Reviewing Contracts

Now the real work begins…..

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EHR Toolkit

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EHR Toolkit

Negotiation Tools Provided

When you receive the contract….

• Ask for electronic format• You can add line numbers to capture concerns or

clarification• Spreadsheet format works well• Submit written list of issues and target date for

response

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Do you seek legal advice?• Contract will be written from the perspective of

vendor• Do not be afraid to seek legal advice if you are not

comfortable• Many companies are not flexible about language

changes

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Contracting Guidelines

Divide into several categories1. General2. Software3. Support4. Interfaces5. Training6. Implementation

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General Contracting Guidelines

• Should include termination clauses• Should stipulate that it may not be transferred

without written approval• Should have a definition section• Should spell out what happens in the event of

default• Time should be included

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Software Specific Guidelines• Who owns the data?• Should include language regarding vendor turning

over source code, etc should they go out of business

• Does the cost include upgrades?• Third party costs?• Does vendor ensure confidentiality and HIPAA?

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More guidelines to consider• Is vendor going to comply with interoperability

standards?• Is there a progressive payment schedule?• Are training costs included? Do you have to pay

for all training up front?• Conditions for breach of contract?

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MU Clause

• Since MU is so important, ensure there is clause relating to MU certification

• Is there an extra charge for this update?

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Support clauses

• What are support hours?• Response time? Problem escalation?• Costs for additional support?• The contract should clearly outline the terms of

support agreement

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Interfaces

• For each interface, contract should include cost and detail

• Should include interface specs• What happens when errors occur

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Training

• How many training hours are included?• Onsite vs. internet? Can you choose?• Who is paying travel costs?• Cost of additional hours?

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Implementation• What is it and what is included?• How is this different from training?• Is there project management included?• Establish per diem rate for implementation

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Tips for Negotiation• Remember, everything is negotiable• You are in charge of the negotiation• Try to find a win/win• Ask for a final due diligence product

demonstration

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More tips…• Prepare for the vendor to be surprised by your

negotiation skills• Do not fall for vendor tactics, i.e. “no one else has

objected to these terms”

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More tips…

• Terms of the agreement can have financial implications far beyond the price– Payment terms– Maintenance/support fees– Price protection– What if the vendor leaves the business?

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And more…• Beware of evergreen clauses (automatic

renewals)• Down payment and installation or pay in full up

front?• Hold some percentage of payment until after go-

live

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Just a note:

EHR’s are very busy right now, and they don’t necessarily have to negotiate. In fact, installation with many EHR’s are months out.

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Contact Information:

Cathey Halsten515-440-8284

chalsten@ifmc.orgwww.IowaHITREC.org

1-800-373-2964IowaHITREC@ifmc.org

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In Partnership with: The Office of the National Coordinator for Health Information Technology (ONC) U.S. Department of Health and Human Services grant 90RC0004/01. IA-HITREC-07/11-275