How to Select an IT Contractor and Negotiate a Contract for IT Services

This is the transcription of my discussion with Michael Uretz, Executive Director of The EHR Group discussing "How to Select an IT Contractor & Negotiate a Contract for IT Services". You can listen to this interview by clicking on the YouTube play button below the first couple of paragraphs.

Robert Gleeman:  This Robert Gleeman with EMR Update. We're talking today with Michael Uretz, Executive Director of the EHR Group, phone number (425) 434‑7102. Michael, thank you for being with us today.

Michael Uretz:  Well thanks Bob, I appreciate it.

Robert:  Our topic today is "How to Select an IT Contractor and Negotiate a Contract for IT Services."

Michael, can you tell me what type of consulting work you do over at EHR Group?

Michael:  What I've been doing the last few years is EHR selection and contracting but also I like to help folks with the IT components; figuring out how to work with IT folks, how to do IT contracting, so I think that's something I bring to and I think it will play in our conversation we're going to have today.

Robert:  Let's say I'm a doctor, maybe three to five doctor office. Michael, why would I want to contract out IT services instead of just hiring my own IT person?

Michael:  Well, actually being an ex‑IT manager myself, I know how tough it is with experience in IT. Unless you are very technically inclined, you probably haven't a lot of experience with those folks. And actually my experience has been working with a lot of small groups doing EMR, that they actually would prefer not to have their hands full of getting somebody onboard, paying salaries and they'd rather contract it out.

Robert:  And what size company should I contract with?

Michael:  Potential problem with a too small a group is that there is no backup, right? What happens if there's a proverbial he gets hit by a truck, right? And you're dependent on this IT resource.

So, if it's too small it might not be good. On the other hand though, my bad experience even as an IT manager, I'm hiring out work to contractors in very large companies and you just don't get the personal attention.

So, it's all individual, but I think there's a sweet spot of, you know, I'm just going to throw numbers out, maybe five, ten people, maybe 15 where it's small enough where you still get that personalized attention and people will take care of you when you come calling.

Robert:  And what services can an IT contractor really offer to a doctor?

Michael:  When you look at an IT contracting group you have to be all inclusive. And typically the types of things, at least with my clients, when I look for IT contractors for the EMR system, they've done things for example from soup‑to‑nuts from the beginning; they'll help evaluate the vendor infrastructure.

In other words, if you're going to get and EMR, you really want somebody in your corner to help evaluate how it's going to work on certain servers; what are the work stations; what kind of network do you need?

So that's one thing. They can help spec out hardware and even negotiate it for you so you can get a good deal because typically a good IT contractor will have relationships with many hardware distributors.

Then the next step would be they need the ability obviously to set the systems up with you so they work correctly. And then you kind of have a choice there: Can they do desktop support?

There are two things: you're going to have servers that are going to run the applications.

Robert:  OK.

Michael:  And then you're going to have the workstations and the tablets and all the things that the nurses and doctors and administrators use. Then the question is, "Do you want to have them be a support desk for those types of things, as well as the applications on the servers?"

So those are kind of the soup‑to‑nuts types of things. And of course really good experience networking because I've found that's where things fall down is not getting good networking infrastructure systems.

Robert:  What should this cost me to get IT contractors in to help me as a doctor?

Michael:  Pricing is across the board, but only plan on what is really important to look at. You're going to see two models of costs. One is an hourly charge. You have a problem and you call them up and they say, "OK, we'll come for an hourly charge of X dollars."

The other option, which I think is a better option, is actually to use them as truly an IT department and contract them on like a monthly basis. Really, it's a yearly type of contract with a monthly payment. And then they are really there for you.

Robert:  And how do you choose an IT contractor? Is it all based on experience and if so what experience should they have?

Michael:  What I've found is two things. Can they communicate? But secondly, really do your due diligence on how they work with other groups or practices. Make sure they can explain to you things in lay language. If you have questions, ask them. And then secondly, just do really, really good reference checks.

Robert:  How do you make sure that they live up to their commitments, Michael?

Michael:  That's why we have things called Contracts and Agreements. It's unfortunate that we need these things, but you need to be sure about their commitments. And that's why you want to make sure you have very, very strong contracts with these folks.

Robert:  What are the components of a good contract?

Michael:  What I'd like to do if we have a minute is kind of go over some of the more important components?

Robert:  Sure.

Michael:  And one is really the service that they're going to give you, the commitment of the service, what is typically called a Service Level, or a Service Level Agreement. And these things are; how are they going to be there when you call them? [laughs]

Are they going to guarantee that they are going to come in an hour, two hours? Three hours? What are they going to do? How are they going to do it? How are they going to escalate things? The process, what they guarantee. You want to get these in writing.

But a lot of people don't go far enough. If they say they are going to come in an hour and they don't come in an hour, or don't call you in an hour, or whatever you guys agreed to, there have to be financial penalties. They have to credit you X dollars of.

The fee per month or whatever you agree on. You know, it's funny. It doesn't matter if it's a cent or $100. The point of penalty is for accountability, really.

Other things you want to make sure, and this is really important, when I have clients in a health and EMR system we'll negotiate then we'll get an IT contractor. The benefit of having an IT contractor is, you put this in the contract, that they are your.

First point of contact. They might not understand the EMR application, but they are a point of contact for you to call if there's a problem.

The termination clause is extremely important! And really, put exclamation points on this. If they don't come up with the goods, if they don't give you good service, well, they should be out. So termination clauses, under certain situations; they haven't come three times in a row, or whatever you negotiate, that there needs to be some kind of termination clause. OK?

What's also extremely important is the definition of what they're going to be doing. Typically you want to have some kind of appendix or exhibit in there that says what they are going to do for you.

And finally, this is extremely important, is what I call transition services. They have to give you documentation of what they're doing and what they've done so if you need to basically pull the plug; you have a transition to another company. And that's really important!

So these are...there are many, many, many clauses, but these are some of the main things I'd like your  folks to think about as they go through and talk to IT contractors.

Robert:  What if I decide to have an in‑house IT later on? They are fulfilling their contract, but I just want to bring it in‑house and hire my own person?

Michael:  Typically when you think about it you have a small practice. You're starting out you might not want to hire an IT.

But let's say you grow four years down the line and now you can afford an IT person or three staff or whatever. You don't want to be restricted.

I'm doing this right now. I'm working with a group of providers. There are about ten providers, they are large enough to have their own IT people, but they want to start out with a contractor's desk but yet they see two or three or four years down the line they might have their own staff.

So what we're doing is we're making sure that from day one whatever work that contractor does for us they're documenting that. And whatever the architecture is, whatever the processes are; how they do backups, when they do things; what the system looks like; because there will be a point in time where this practice that hired me will want an IT manager and that IT manager will step in and say, "OK, how does this work?"

And if we have the documentation where the IT contractor has been doing all the work for the last one, two, three years, than it's much, much easier to make that transition and that's very important for you to have.

Robert:  As a final word to the 6,000 or 7,000 doctors that are members of the EMR Update, who may have been holding off on EMR because they're afraid of the IT aspects, what can you leave them with? What can you tell them to bolster their courage out there?

Michael:  That's a great question. In fact it's funny because I do a presentation called "Barriers to Adoption." I found that it's just the fear of technology that holds people up.

But to answer, really, that's one of the reasons why I think I see people going towards, at least initially when they do this, they're not big enough to get their own folks, to hire it out.

Because that's quite a commitment to have to interview somebody, bring them on your staff, and have them be part of your business, OK. Much less of a fear if you get somebody from the outside with a good contract that lets you pull the plug at any time, and then you can slowly move into it.

Make sure, as I talked about before; get the person you hire to be very communicative with you. Do not be shy about getting somebody you can communicate with. There's something funny about communication, if you feel comfortable with that person it's going to overcome a lot.

Secondly, if you take away the fear of having this long‑term commitment of hiring somebody for your staff that will also take away the fear. You have to have an out. You have to have good contracts and you have to have really good commitments.

So if you have that I think those are some of the things I've found where people will make that jump and then do it.

Robert:  Michael Uretz, EHR Group, thank you very much for being with us today, Michael.

Michael:  Thanks Bob.

Thanks again to Michael Uretz, The EHR Group, for supporting our Getting Started resources for Doctors Researching EMR solutions.  

For more information about the subjects discussed here you can contact Michael Uretz at the details listed below.
See our other Getting Started resources here.

Contact information for Mike: 

Michael Uretz, Executive Director
The EHR Group
700 NW Gilman Blvd. Suite E293
Issaquah, WA 98027
Tel: +1 (425) 434-7103

E-mail: sales@ehrgroup.com
Website: www.ehrgroup.com