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RFPs can keep your purchases on track and help you keep your job

Radiology Administrator's Compliance and Reimbursement Insider, November 1, 2005

Using a request for proposals (RFP) when making purchases or deciding on new services can reduce your susceptibility to smooth sales pitches, help you weed out unsuitable choices, and ultimately help you keep your job, said Patricia Kroken, FACMPE, CRA, during a presentation at the Radiology Business Managers Association's June conference in Las Vegas.

An administrator who makes a bad purchasing decision might saddle the department with equipment that slows productivity or creates headaches for the staff, and, as a consequence, he or she might end up in the unemployment line.

But using an RFP to guide purchasing or contracting decisions allows for more accurate comparisons between products and services, Kroken said. An RFP also provides a layer of protection for the administrator so if the final decision turns out to be the wrong one, he or she won't be the only one left holding the bag.

You can use an RFP to make a number of key purchasing or contracting decisions. Some appropriate uses include

  • buying a practice management system

  • buying a radiology information system or PACS system

  • choosing a billing company

  • choosing teleradiology services or purchasing-related equipment

  • buying large-scale data storage

  • purchasing medical equipment

    Once you decide to use an RFP, include several pieces of information in the documents to receive the best proposals possible.

    A profile of your practice

    "Traditionally, radiology has had an adversarial relationship with vendors," said Kroken. "We don't want to tell them anything, but we want them to give us exactly what we need."

    If you provide vague information about the needs or your practice, it will lead to vague price quotes and information about the system or service you are purchasing. For this reason, an accurate practice profile is a key component of your RFP. Kroken recommended including the following information in your profile:

    1. The size of your practice. Often, pricing is based on the number of physicians in a practice, said Kroken.

    2. Your facility's sites of service and types. For example, are they hospital-based? How many of them have downloads? Make sure that whom ever you deal with has worked with organizations of similar sizes and types.

    "A system can have a lot of user-friendly functionality, but if [the company hasn't] dealt with hospital downloads and the volume and issues associated with it, [it] can be overwhelmed," said Kroken.

    3. Future growth expectations. Providing information about potential future growth is key, because whatever system or service you decide on has to be able to accommodate that growth.

    Kroken suggests that you focus on growth trends from the past few years to make predictions about the future. Will you continue to grow at the same rate? Or will market factors make you grow faster or slower than in the past? Getting a grip on this information can help you to negotiate solid deals that will allow you to add on to the system in the future.

    4. Managed care profile. Some systems will verify payment amounts to ensure that your organization isn't being shortchanged. Providing information about your payers can help vendors determine your needs.

    5. Information about employees/system users. Include information about employees, such as how many there are and whether they work on- or off-site.

    6. Details about other systems that you will need to integrate. For example, if you have a solid system for mammography reporting that you don't want to replace, you'll have to find out whether it is compatible with whatever new system you want to install.

    7. Data storage requirements. Outline your current storage needs and anticipate what you might need in the future. Also look at issues related to how data is backed up and how it would be recovered if lost.

    The vendor profile

    In addition to providing information about your own facility, request information about the vendor. Kroken said that knowing the following information can give you a good snapshot of a vendor or service provider's qualifications:

  • The type of company-publicly traded or private. "It's good to know whether a company is publicly traded because you can get more information about that company," said Kroken. For example, you can find out if the company is involved in any shareholder suits or if it is profitable.

  • Location of the company and its service center. If you are a West Coast practice and the service center is on the East Coast and has service hours of 8 a.m. to 5 p.m., you might run into problems.

  • The company's radiology and imaging experience. A company can develop a great system that has worked well in numerous settings, but if it has never been used in radiology, you might be taking a big risk.

  • Details about the system. Ask where and when the current software version was developed. When were the most recent updates added and were they based on an older or newer platform? "Make sure a new face wasn't just plunked on an old system," said Kroken.

  • HIPAA and regulations compliance. Ask whether the system complies with HIPAA and other applicable regulations. Does the organization have a compliance plan?

  • System audit features. Examine what audit features the system has.

  • Disaster planning. Find out what the company will offer in the event of a disaster. Can the vendor help replace hardware? Does it offer support plans? "What happens if something blows up?" said Kroken.

  • Company representation. Who from the company will handle your case and what are his or her qualifications?

    Developing selection criteria

    Establishing selection criteria for your RFP will help your organization avoid being swayed by a smooth-talking salesperson, said Kroken. It gives you a concrete wish list that you can use to make objective comparisons.

    The first step in developing these criteria is to focus on your needs versus your wants.

    Ask these key questions:

  • What features should the technology have?

  • What requirements do you have regarding service?

  • What problem are you trying to solve with this pur-

    chase or service? To determine this, Kroken draws a

    work flow diagram and looks for areas of process

    duplication.

  • What improvements do you want to make to your

    organization?

    Some examples of "must have" items you may want on your wish list include the following:

  • Secured report delivery on a radiology information

    system

  • Hospital downloads on a practice management system

  • Experience in radiology, for consultants and billing

    companies

  • Guaranteed "up" time on a PACS system

    When it comes to these "must have" items, ask detailed questions. For example, if you are looking for a billing service, you might want it to use radiology-certified coders. Kroken said she encountered one billing firm that said it had all radiology-certified coders, but further questioning revealed that the coders weren't certified through an external organization, rather internally thorough their own process. "These are the kinds of details you want to have," she said.

    After setting your selection criteria, develop a submission packet for the vendors. This should include a cover letter along with the following information:

  • Project overview

  • Proposal due dates

  • Estimates on the dates that decisions will be made

  • How many proposals to submit

  • Whether the facility will accept electronic submissions

  • That a price quote is required

  • Practice profile

  • Vendor profile

  • Specifications for the technology or service

    Once the responses come in, compare them and eliminate the unqualified candidates. Then schedule demonstrations with the finalists.

    At this stage, include the people who will use the new equipment or service in the decision-making process, said Kroken. Those people should test the equipment for usability and have input into the final purchasing decision.

    Kroken gives an evaluation form to staff who test new products and asks them for a final recommendation on what to buy. Ultimately, the facility may go with a different option for cost reasons but either way, the input is critical.

    Site visits are also a good idea. Don't let the vendor or service provider take you to a site that performs well but isn't similar to your organization. Ask to see a site that looks like your own.

    Insider source

    Patricia Kroken, FACMPE, CRA, Healthcare Resource Providers, LLC, Albuquerque, NM.

     

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