HEALTHCARE: How Can You Reduce IT Spending?

Healthcare costs are rising.  Providers are investing large portions of their IT spend in technologies like EHR/EMR, newer HIS systems to replace older legacy systems, MDM (Master Data Management), and HIPAA compliant solutions such as Encryption (including secure group messaging and other tools), Access Control and Authentication to protect PHI.  So how can IT Spend Management help?

Let me start with 4 questions we are frequently asked about spend management consulting:

Q:    What is Spend Management and can it help my organization put hard dollars back into my IT budget? 

A:    To boil it down, Spend Management is the practice using data, teamwork, technology & negotiation strategies to lower the cost of purchases (technology in our world).  Spend Management provides both insight and actionable information.

Q:    My procurement team handles this.  Why would we need you? 

A:    This answer has many points…none of them are that your procurement team doesn’t do a fantastic an adequate job negotiating pricing or terms.  However….

–    Most procurement executives only make a particular purchase such as HIS or EHR every 3 to 5 years (& more).  It’s hard to know recent data and licensing issues when you only handle those once every few years.  We handle healthcare software transactions multiple times a month regularly.

–    Spend Management accelerates decision and purchase cycles through access to real time market data and vendor insight.

–    Bringing a 3rd party into a purchase at the right time (whether that be early or late depending on the deal) transaction) is a powerful negotiating tool.  It also takes the heat off of you’r  enables the Procurement or IT team to maintain a positive relationship during the negotiation process the “good guys” in some situations.

–    It shows shareholders and executives even a higher level of “good stewardship” of the company’s money.

–    With SM Financial, we have a no risk guarantee, because we don’t get a dime until after we save you money! This “Success Model” empowers your team.

Q:    What are typical results of implementing SM Financials’ Spend Management Consulting?  

A:    First, let’s talk bottom line.  If we take away outliers where we savings millions for our clients, or tens of thousands…typically we save our healthcare providers between 15-30% on whatever solution they are purchasing (non-hardware which tends to be a bit lower).  Recently we saved one healthcare provider over $550K on a transaction with under a $2M price tag.

There are other key results though.  We typically move the purchase through evaluation/decision/purchase faster, getting your project started faster.  Because we all come from the vendor world, we know the tricks vendors play with pricing and licensing.  We have tracked thousands of transactions, so we are able to use that data to ensure Fair Market Value or better.

We also strengthen the relationship between vendor and customer by having a 3rd party, unbiased organization handle the negotiations where appropriate.

Q:    What types of healthcare software and vendors have you worked with? 

A?    We have worked with all categories of software that healthcare providers use including, HIS, EHR/EMR, Claims Management, Physician Management, Revenue Management, HR Management, Expense Tracking, Billing/Invoicing, In-Patient and Out-Patient Management, Security, ECM, Master Data Management, BPM, Mobile Device Management and more.

We have worked with large providers like McKesson, Cerner, Athena, Allscripts, Misys, CSC,  EPIC, GE Healthcare, MEDITECH, eClinicalWorks, NextGen, Greenway Health, MEDHOST, Nuance, Hyland, McAfee, Symantec, TigerText, MobileIron, AirWatch/VMware just to name a few.

The bottom line is that implementing spend management can help your organization source faster, save you money and lower your risk of overspending.

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