Chapter 13 introduced you to third party vendors. We began by defining third party vendors. We then discussed the risks and benefits of using third party vendors.We discussed the necessary services for which your business will need a third party vendor.We explored helpful and useful services a third party vendor can provide to your business. We then discussed unnecessary services and how vendors will try to convince you that you need something that you really don’t need.We then discussed negotiation tactics for third party vendors.Then we discussed the need for vetting vendors and how to go about doing that.Finally, we explored risk management criteria for vetting third party vendors.The following exercises will help reinforce the concepts presented in the textbook.
Key Terms
Due Diligence
The investigation or exercise of care that a reasonable
business or person is expected to take before entering into an agreement or contract with another party, or an act with a certain standard of care. It can be a legal obligation, but the term will more commonly apply to voluntary investigations.
Vendor Risk Management
A comprehensive plan for identifying and
decreasing potential business uncertainties and legal liabilities regarding
the hiring of 3rd party vendors for information technology (IT) products
and services.
Vendor Credentialing
The process by which companies and facilities
ensure that the vendors they work with have the appropriate background and training to access their facilities.
C4UHC
A company who mission is to streamline the health care industry representative credentialing process in a manner that will protect customer safety and confidentiality, eliminate duplicative efforts and costs, and meet the needs for both suppliers and health care providers.
HCIR
Healthcare industry representative is any vendor representing a third party company seeking a business relationship with a healthcare organization.
Third Party Vendor
Any organization outside of a company that provides a product or service that that company pays the vendor to provide.
Risk Management
Assessing workplace risks and works to find resolutions through policies and procedures.
PHI
Protected Health Information is any information in a medical record that can be used to identify an individual, and that was created, used, or disclosed in the course of providing a health care service, such as a
diagnosis or treatment.
ONC-ATCB Certified
(Office of the National Coordinator Authorized
Testing and Certification Bodies) Certified organizations that have been
authorized by the ONC to perform complete EHR and/or EHR Module testing and certification. ONC-ATCBs are required to test and certify EHRs to the
applicable certification criteria adopted by the Secretary under subpart C of Part 170 Part II and Part III as stipulated in the Standards and Certification Criteria Final Rule. ONC-ATCB is the main certification authority for
electronic health record (EHR) technology, namely EHR vendors and
consultants within the United States.
ONC-ATCB Certified
(Office of the National Coordinator Authorized
Testing and Certification Bodies) Certified organizations that have been
authorized by the ONC to perform complete EHR and/or EHR Module testing and certification.
Merchant Service
A category of financial services in the United States that is used by businesses. Merchant services are authorized financial services that allow a business to accept credit card or bank debit card transactions using online ordering or point of sales systems.
POS: Point of Sale
A term used to describe the transaction between the
retailer and the consumer. When the transaction is made through a third
party merchant, such as a debit or credit card, a Point of Sale device is used
to complete and record the transaction. It is the moment of transaction
between a business and a consumer for goods or services rendered.
Loan Scouts
Vendors who shop around for a loan that will meet the criteria your business currently qualifies for.
Expected Outcomes
Be able to define a third party vendor
Understand the risks and benefits of using third party vendors
Know the services your business and which third party vendors will be needed to fill those business services.
Recognize beneficial services vendors can provide to your business.
Recognize unnecessary services that vendors will try to convince you your business needs
Know vendor negotiation tactics
Know what to watch for with vendor salesmanship tactics
Know why you always have the upper hand in vendor negotiations
Understand the need to vet vendors
Understand the process of vetting vendors
Be aware of risk management criteria for vetting third party vendors
Key Concepts
Third party vendors provides services that your business would otherwise not be able to provide.
There are vendor services you need, vendors services that are valuable because they enhance customer experience and staff workflow, and there are vendor services that are unnecessary.
Vendors need your purchase to produce revenue in their company.
Vendors are salespeople. But remember, they need you, you always have the upper hand.
Be assertive, but you don’t need to be aggressive.
Don’t get seduced by gifts and flattery. Don’t be bullied by guilt statements that make you feel you owe the salesman something. If it doesn’t work for your business, say, “No”.
Understand that negotiations can take time.
Be sure the vendor is certified or authorized to provide certain services.Be sure they have the correct credentials, licenses, permits, certificates, or other required items to provide the service in compliance with HIPAA, OSHA, or other government regulating agencies.
Read every contract you sign. You never know when the vendor is going to insert a clause into the contract.
Be aware of red flags that signal a vendor is a poor choice.
Chapter Slogans
Vendors are salesmen!
They need you!
Read the contract you sign!
No one will care about your business as much as you!
Salesmen are not interested in helping you; they are interested in making the sale!
POUND THE PAVEMENT
1. When exploring different services for your business, meet with multiple vendors, get a feel for each, see what they offer, and gain experience is seeing how far you can negotiate, and what options might be possible.
2. Speak with other business owners about their vendors, see who they trust and have had long term relationships with.
3. Ask other business owners what vendor horror stories they have had to give you more knowledge to avoid making such mistakes.
