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State Medical Association: Pushing Vendors to Write Customer-Friendly Contracts Will Spur Physician EMR Adoption
Vol 1, Issue 14
August 28, 2008
In an effort to simplify electronic medical records (EMR) contracting procedures, The Ohio State Medical Association (OSMA) is establishing a Standards of Excellence designation for physician systems vendors. “We think EMRs are a benefit to both physicians and patients,” says OSMA senior director Carol Wright Mullinax. “But practices have a lot of anxiety about the whole EMR selection process and doctors are concerned about having their rights protected. Having the right contract language in place protects physicians’ rights and resolves much of the anxiety.”
Association, Consulting Firm Develop Terms and Conditions List
The Hilliard, Ohio-based OSMA has been working since March 2007 with national healthcare consulting firm The Coker Group to develop an approved list of terms and conditions for EMR contracts. “We are finalizing the list now, and then we will see which vendors are willing to commit to the final terms and conditions,” Mullinax says. OSMA plans to launch its campaign on January 1, 2008.
Sue Hertlein, a senior consultant with the Alpharetta, Ga. based Coker Group, has been actively involved in developing the contract requirements. She says several essential items will be included in OSMA’s final standards, which will be released this month.
"The ability to assign licenses is critical,” says Hertlein. “Currently most licenses are un-assignable, so if a practice has a merger, is sold, or has a re-organization, then the new owner has to buy the licenses again. The licenses must have portability, which also makes practices more marketable.”
Maintenance Caps, Milestone-Based Payments Specified
Hertlein expects the requirements to include limits on annual maintenance rate increases, a requirement for the vendor to carry error and omission insurance, and terms for mutual indemnification. Additionally, vendors must agree that they won’t access patient information without the practice’s authorization. They must also certify that they will adhere to the requirements of the Ohio State Board of Pharmacy for electronic prescribing.
Vendors that earn the Standards of Excellence designation will agree to contract language that specifies milestone-based payments. “Stepped payments will probably be based on contract signing, installation of software, training, PM live, and EMR live,” says Hertlein.
Vendors Mostly Positive, But Some Will Opt Out
Both Mullinax and Hertlein indicate that vendor feedback has been generally positive. “Vendors are looking to differentiate themselves in the marketplace,” says Mullinax. “From their point of view, this is a way to stand out from other vendors and is a marketing advantage.”
“I would say vendors are very interested and think it is a good program,” says Hertlein. “I think we will see some very acceptable levels of participation.”
Despite favorable comments, Hertlein admits that not every company will sign up. “We first discussed this with 23 vendors, but they won’t all participate. OSMA is not focused on a large number of vendors, but on a solid five to 10 that are willing to step up and say they want to help practices in the state of Ohio move forward with EMRs.”
Chicago, Ill.-based Allscripts will participate in the OSMA program. Dean Jolly, vice president of Midwest sales for the company’s Healthmatics division, believes complying with the standards makes sense. “We have a big presence in Ohio and 4,800 of OSMA’s 4,900 group practices are under 25 doctors. So, they are in our geography and in our sweet spot.”
Success Factor: Number of EMR Implementations
Jolly believes vendors will benefit from the program. “It helps to know upfront that you don’t have to go through the whole contract review process. There is a short list of vendors.” However, he thinks the stringent contract terms may deter some vendors from participating. “A number of vendors were disappointed how unfair the proposed terms were to the seller and how fair for the buyer. But, that is the way the physicians and Coker want it.”
Andrea Lesh, vice president of sales for Cedar Park, Texas-based e-MDs indicates her company also supports the general OSMA initiative. “It is a good thing any time a group gets together and standardizes contracts to protect interested constituents, as long as the terms are within reason.”
“We are looking forward to launching the program,” says Hertlein. “OSMA has done an excellent job of promoting EMR to their members and this will be an excellent program. But, the real determination of its success will be when evaluating if there has been an increase of EMR implementation in the state of Ohio.”
— Correspondent Michelle R. Noteboom
