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ICD-10 Contract Analysis June 17, 2010 Diana J.P. McKenzie

ICD-10 Contract Analysis June 17, 2010 Diana J.P. McKenzie Partner and Chair, Information Technology & Outsourcing Practice Group Hunter, Maclean, Exley & Dunn, P.C. 200 East Saint Julian St Savannah, Georgia 31401 Direct:  912-238-2627 Cell:  847-370-1121 Fax:  912-236-4936

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ICD-10 Contract Analysis June 17, 2010 Diana J.P. McKenzie

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  1. ICD-10 Contract Analysis June 17, 2010 Diana J.P. McKenzie Partner and Chair, Information Technology & Outsourcing Practice Group Hunter, Maclean, Exley & Dunn, P.C. 200 East Saint Julian St Savannah, Georgia 31401 Direct:  912-238-2627 Cell:  847-370-1121 Fax:  912-236-4936 Email: dmckenzie@huntermaclean.com

  2. Step # 1 – Review Each Vendor Contract • Contract clauses that may help • ICD-10 Provision – if the contract was entered into within the last few years, it may have a specific provision to address ICD-10 updates, and may have a specific warranty that the software will comply with ICD-10 requirements. • Some contracts have a provision requiring the vendor to provide updates to comply with changes in the law at no charge. • Some contracts have a provision requiring the vendor to provide updates to comply with changes in the law at no charge AS LONG AS the purchaser is paying vendor for maintenance. • Some contracts have a warranty that software will all times comply with federal laws and regulations, whether existing on effective date or enacted, amended, or promulgated thereafter. • Some contracts are silent on updates to comply with changes in the law.

  3. BEWARE • The Phoenix – software is burned, but new compliant software rises from the ashes. • Contract clauses that restrict updates or modifications to those that are “technically feasible and commercially reasonable.”

  4. Enforce, Amend, or Terminate • If the contract is favorable to you with regard to updates and modifications, enforce it. • If the contract is not favorable to you with regard to updates and modifications, or does not address them, then you have three choices: • Pay what is necessary to obtain compliant software • Amend the contract • Terminate the contract and switch to a vendor who is compliant

  5. HIPAA 5010 and ICD-10 compliant upgrades by Deadlines? Step # 2 – Talk To Your Vendors Terminate per terms of contract and find new vendor No Confirm in writing with schedule Must include testing Yes Cost > Benefit Upgrades at no charge? Cost/Benefit Analysis No Confirm in writing Benefit > Cost Yes Cost > Benefit Cost/Benefit Analysis Training and support for upgrades at no charge? Confirm in writing with training and support plan Benefit > Cost Written confirmations, schedule, and plan as amendment to contract Yes

  6. Step # 3 – Contracts Under Negotiation • 80% Similar Product - If, within the first four years of the agreement, Vendor releases a new software product which contains 80% or more of the features and functionality of the software product purchased by Customer under the agreement, Vendor shall provide that newly released software product to Customer at no additional cost. • ICD-10 Compliance – Vendor’s software shall support HIPAA 5010 transactions and the use of ICD-10-CM (diagnosis) and ICD-10-PCS (procedure) codes. [Software supports ICD-10 now] • ICD-10 Warranty - Vendor warrants that the software will support HIPAA 5010 transactions and the use of ICD-10-CM (diagnosis) and ICD-10-PCS (procedure) codes. [Software will support ICD-10 in the future] • Compliance with Laws – Vendor’s software shall comply with, and enable Purchaser to comply with, all applicable laws, regulations and guidelines of any governmental entity that relate to the healthcare industry, whether now existing or enacted, established, or promulgated after the Effective Date of this Agreement, and any amendments or changes to any of the foregoing. • Compliance with Standards – Vendor’s software shall comply with, and enable Purchaser to comply with, all requirements and standards applicable to the healthcare industry set by organizations with authority to create such requirements and standards, including, but not limited to, the Joint Commission. • No Sunset - Vendor will continue to actively market, license, support, maintain, and actively enhance the software for 10 years after the Effective Date and will provide Purchaser with notice at least 1 year before ceasing to market, license, support, or maintain the software.

  7. Questions? Diana J.P. McKenzie Partner and Chair, Information Technology & Outsourcing Practice Group Hunter, Maclean, Exley & Dunn, P.C. 200 East Saint Julian St Savannah, Georgia 31401 Direct:  912-238-2627 Cell:  847-370-1121 Fax:  912-236-4936 Email: dmckenzie@huntermaclean.com

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