Insurance companies, employers, and TPAs rely on vendors to process bills, build and operate networks, manage prescriptions and PT, support litigation, and provide expert advice on problematic medical issues. In many instances the vendors are selected thru a competitive bidding process, wherein the lowest bidder gets the deal, or at the least has a much better chance of landing the business than their more costly competitors.
But in others, the selection process goes on seemingly without end.
I’ve come across many instances where a large payer publishes an RFP for managed care services – networks, PBM, case management, physician adviser services, or some combination of the above. And in far too many, the selection process appears to be arbitrary, biased, or designed to find a lower price to use in negotiations with the incumbent.
In others, the decison is never made. After the RFP responders spend countless hours putting together presentations, submitting financials, designing programs and staffing models, analyzing data and flying to meetings (often in Chicago in February), the process appears to just fade away, with no decision made and no justification given.
I’ve been on both ends of this process, working on behalf of clients who could not get to a decision, and for vendors doing their level best to win the business on the basis of their hard work and creativity.
The non-decisions, the endless rounds of Q&A, “evolving” criteria, frequent changes in personnel involved in the decision process, and often dictatorial tone employed by the “customer” can be enormously damaging, all the more so because the customer does not even realize the damage they are doing to their own cause.
This behavior leads many vendors to avoid the RFP process, or to minimize the amount of effort they put forth when responding, or to back out of these processes when they start to drag out. The result is the “customer” ends up selecting from the vendors with the intestinal fortitude, or outright desperation, required to see the process through. Then the customer is often frustrated with the result – the vendor can’t deliver for the agreed-upon price, or there are costs that “pop up” after the deal is done, or the level of service is unsatisfactory.
The customer now believes all vendors are liars or cheaters, out to “get” the customer.
What does this mean for you?
It doesn’t have to be that way. But until and unless “customers” treat “vendors” with respect, honesty, and openness, it will be.