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Why does it take so long from the moment you get the yes to actually get a contract done in Healthcare. Today we discuss.


today in. I T I want to talk about why it takes a long to get a contract. In healthcare. This is more of a sanity thing for me because I have this conversation, I don't know, a couple times a month. And I thought, Hey, I could just point people to this. And it would be an efficient way. For people to get an idea of why it takes so long to get a contract.

In healthcare. We're also going to talk about what you can do to, , facilitate a better process within your health system. My name is bill Russell. I'm a former CIO for a 16 hospital system and creator of this week health set of channels, dedicated to keeping health it staff current. And engaged.

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And you'll be taken to a page where you can give directly. And we want to thank you in advance for your generosity. All right. Let's talk contracts. It's an interesting, I have this conversation mostly. With startups and people who are looking to get into the healthcare space. And one of the warnings I give them is everything takes longer.

Than you think it should. Because everything takes longer than it should in my estimation. And we talked about the sales cycle and just how long the sales cycle is because of the complexity of the sales cycle. Generally, even if you get to the economic buyer, The economic buyer cannot act on their own. They have to bring a lot of people into it. So you have to determine who the influence buyers are. You have to build a coalition, you have to have a good narrative. You have to give them the information they need to do the inside sale, and you have to be persistent.

Because sometimes these things die and they didn't really die. They just, people got busy. And so if a salesperson is not persistent and they could feel like the deal is. Is languishing for whatever reason. And not follow up. On it. And so there's any number of reasons why these things can be slow. So you have, the sales process can be slow.

The point I'm going to be talking about today is why does it take so long from the point of a contract? From the point somebody says, yep, you won. Congratulations. And I would warn you do not go out and have a steak dinner just yet, because it does take a long time to get from point a to point B. So they say, all right, we're ready to go. Let's go ahead and do the contract. One of the mistakes that people think is, well on that verbal, we can start doing work.

There's very little work you can start doing, especially given the security posture of healthcare. These days, if you need access to any data, that's going to have to go through a process. Getting through that process is going to take some time. So, , invariably somebody goes, well, just give me the anonymized data. Well,

That would take a system that has figured out how to set up that anonymous anonymized data in a sandbox environment, because you can't get anywhere near the production until you have the contract signed because the contract has language in there. To protect the health system and to protect you as a vendor.

As well. So the, , you know, so we have that issue, so you're not going to get access to a whole heck of lot. You really can't get work. Going until the contract is done.

And so. Contract. And now I'm going to change my focus to talking to the health systems. Why does it take so long to get a contract done? I realize that a lot of cases, the legal team has been outsourced. I also realize that in a lot of cases, The legal team, if it hasn't been outsourced as a small team,

And they are overwhelmed. They do a lot of contracts. We do a lot of contracts in healthcare. But we do the same kinds of contracts year in and year out in healthcare. It is a perfect opportunity to streamline a process that you have a significant amount of control over. And so let me tell you what we did at St. Joe's.

One of the things we did is we knew that we were going to be doing a lot of deals with startups. And startups don't have big legal teams on their side either. And we also knew we wanted to get them from, from contract to productivity as quickly as possible. So there was a handful of things that we looked at. One was, is there a standard contract to get them working in a sandbox environment with non mic?

Data. To do a proof of concept. And is there a proof of concept contract contract, which is so simple. That it doesn't require the same kind of, of rigor that you would for the normal contract. So you can, you could essentially sit down with somebody and say, , Hey. The big contract. Let's just assume we don't have a process yet. Big contracts gonna take some time. It's gotta go through legal. It's gotta be reviewed and we're going to have some back and forth between our two organizations. It could take as much as six months.

But we want to get you working as quickly as possible. And in order to do that, we have a proof of concept contract. Which is really pared down. Only a couple of pages. It doesn't give you access to our production systems, but it gets you access to our sandbox environment. Our sandbox environment has all the things that you're going to need to showcase your solution. We're not gonna be able to test scale, but we're going to be able to test the solution itself.

Maybe get it in front of some clinicians, maybe get it in front of, , some it staff to get them some, , experience with it. Maybe it's an administrative staff as well, but regardless. It gets them in that environment very quickly. Pared down contract, easy, back and forth, not a lot of penalties because they're not dealing with the production environment.

And if you set up your security right around that environment, it is going to be a fairly safe way for them to be, , to really get up to speed quickly. So first idea. For you is set up the sandbox, set up the anonymized data, set up that whole. , area, which hopefully you have a testing area. Now, when I came into St. Joe's we had, gosh, did we have a testing area for anything? We definitely didn't for the HR. We didn't, no, we, I can't remember an environment that we did have testing.

So we had to, we had to stand this all up from scratch. We had to rethink it and what things we wanted to have in the sandbox environment in order. To do the things that we wanted to do. , we also talked to our partners. And talk to them about the sandbox environment and licensing for that sandbox environment, which we, , negotiated at the time in a way that was essentially saying, look.

This benefits use as much as it benefits us. This should not be really considered an extra license because we're not really using it for production. We're using it to ensure that we bring things into the environment. And, , protect your reputation by making sure your system continues to function while and whatnot. So you got to stand up that test environment.

, You know, , EHR in some way, shape or form, , integration engine. , data fabric in some way and a anonymized data. You name it. You just have to put some of those things in there. Obviously when you get into medical devices and whatnot, it's going to take a little bit of additional investment, whatnot. We had a couple of rooms that were like a test clinic and a test.

, acute care room as well. We did not have an ICU that would have been too expensive, but we had a lot of devices that were in those. We had set up when we multipurpose use it for a lot of things, but it could have been used in our sandbox environment as well. Anyway, set that up. Then get together with legal and start with the question of, could we come up with a pared-down contract that gets people started in working it just in our sandbox environment. They cannot get outside of that environment if they do it violates the contract. But.

Just to get them started so that it's, we are making progress towards our goals and our objectives while we're doing the larger contract. All right. So there's two ideas right there. Let's talk about the larger contract.

Every contract for whatever reason. Tends to start with the same penalties and just a whole bunch of language that just doesn't need to be negotiated every time you do it. Yes, you're going to ask for ridiculous. , coverage in terms of a liability coverage and those kinds of things. , but. Keep asking the question, the smaller, the companies you're working with.

Sometimes I've seen some insurance requirements on those small companies. Now I'm looking at them going. Nobody would pay for that kind of liability coverage. And so the contract needs to be, you need to go through it with a lens that says what. What do we really need? What are we going to be asking for?

You know, asking them for unlimited liability coverage in the case of a breach is silly. No, one's going to give you that. So why have it in your contract or, you know, $20 million for a company that's only bringing in 5 million a year. That's, you know, it's a death sentence. They're not going to sign that.

, and so I would say we need to go through our contracts and pair them back. Pair them back to what is reasonable. What is necessary. And, , and just anyway, It was interesting how we start. We always started with. Our contract asks for the world. Their contract asks for the world. And. Because of that, it slowed the process down. Significantly lawyers had to go a lot of back and forth and that kind of stuff.

I could see that with the EHR. I could see that with big systems, your ERP and other things, but at the end of the day, , some of the smaller players, you're going to be dealing with some of the startups you're going to be dealing with. , you still want to hold them to a standard around security and privacy.

And audits around those things and whatnot, but identify what's reasonable and customary identify what you need in order to protect your environment. And build around that, build the contract around that. Let me ask you this question. What's the last time you revisited your contracts. When's the last time you revisited the standard language in your contracts? That's it? Because the funny thing is when we collected all of our contracts with St Joe's and we started looking at the language, it had changed so much. Every contract was its own living entity.

Like we had no idea if the language was going to be in one versus the other, because they all got negotiated and they were also custom. And that drives up your cost because it's legal fees, legal fees are expensive. , so I would treat it just like you do every other project where you are looking for automation, you're looking for a simplification.

, you were looking to drive out the complexity of the environment. If you can drive the complexity out. You're going to get faster to productivity from the contract signing to, , actually having that vendor do work and then actually having that vendor partner. , implement their solution is going to be a lot quicker as well. I highly recommended that people take the time.

To look at that contracting process. It's a problem for your vendors. It's a problem for you and it's a cost for you. And so if you have a little time is going to pay huge dividends. Given the number of contracts we sign every year in healthcare. It all right. That's all for today. If you know someone that might benefit from our channel, please forward them a note. They can subscribe on our website this week.

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