Developing a Request for Proposal (RFP) is as complex a challenge as developing the response to an RFP. This is especially true when buyers are creating the RFP for a service or offering that is new in the market. We see this situation playing out in the ICD-10 space where providers are looking for ICD-10 financial risk assessment services as a precursor or part of their overall assessment activities.
The benefits of performing a financial risk assessment are clear:
- The ability to project impact to revenues for the entire organization
- The ability to identify the specific negative dollar impacts to the mandated ICD-10 conversion down to the code, department/specialty, and physician level
- The ability to better prioritize training, documentation, and system/IT conversion activities
- The ability to identify potential clinical documentation improvement (CDI) opportunities within the ICD-9 code set that will optimize reimbursements today and mitigate financial risk
- in ICD-10
Providers realize that these benefits have immediate and lasting value.
Consequently, there has been a recent uptick in the number of ICD-10 financial risk assessment RFPs in the market. However, because of the novelty for this need within the industry, there are few resources or tools to assist providers with their RFP process. Often times what is issued is based on old technology or software RFPs that don’t provide a meaningful way to compare ICD-10 financial risk assessment vendors. The existing questions may not get to the real value of the solutions or how each vendor will address an organization’s specific needs.
To produce a more effective ICD-10 financial risk assessment RFP, a provider should start by asking the following four key questions:
- Do I understand what it is that I am buying?
- Does my organization have clear objectives/goals for our ICD-10 financial risk assessment?
- Do I understand the outputs of an ICD-10 financial risk assessment and how they will meet my objectives?
- Do I know who needs to be involved in the evaluation process?
Do I understand what I am buying?
This seems like a simple question to answer; in fact, it is very complex. The typical approach is to start by performing market research, which helps determine the market players, their individual value propositions, and what differentiates each product or service. This information is usually available through analysts and research firms for more established offerings. However, in the case of ICD-10 financial risk assessments, this level of detailed analysis doesn’t exist. Information and perspectives on ICD-10 are readily available, but there is nothing out there that compares financial risk assessment services and solutions.
With a list of ICD-10 financial risk assessment vendors in hand, you can start to target the companies that will receive your RFP. This brings us to the next step – understanding and communicating your ICD-10 financial risk assessment objectives.
Does my organization have clear goals ICD-10 risk assessment?
Having a clear set of ICD-10 financial risk assessment objectives will help you better compare the available solutions based on what matters most — your business needs. Each provider type will have a different set of objectives depending, in large part, on how directly ICD-10 impacts revenues. For example:
- An acute care/inpatient facility’s objectives should reflect the ability to quantify the financial impact of an ICD-10 implementation in dollars
- An outpatient facility’s objectives should reflect the more “indirect” risk that ICD-10 poses to operations and potential revenue impacts through increased denials
- A critical access hospital’s objectives should reflect the need to streamline the conversion and address areas of unspecified coding in ICD-9
- How you plan to use the assessment reports and outputs should also be accounted for in your objectives. Some organizations may chose to focus on prioritizing planning efforts while others may be more interested in driving stakeholder engagement. Example objectives include:
- To drive prioritization of [organization’s] ICD-10 conversion plan by financial risk
- To focus training and education prioritization so it is aligned to the areas at greatest risk of negative reimbursement impacts
- To drive alignment between the business and IT around the common goal of addressing and mitigating ICD-10’s potential negative financial impact
- To engage stakeholders from across [organization] and align key leadership around [organization’s] ICD-10 initiative
To assess a vendor’s ability to meet all your objectives, it is helpful to issue a Request for Information (RFI). These requests provide an opportunity to communicate your ICD-10 financial risk assessment objectives, gather information on each vendor’s capabilities, and assess how well each vendor’s solution fits with your stated objectives. It is important to note that an RFI does not typically include pricing questions; those questions are usually saved for the full RFP. RFIs are also a good way of assessing each vendor’s credentials.
RFIs do not have to be as detailed as RFPs. While some buyers elect to use the RFP questions that they plan to issue, others take a more informal approach and ask for an overview of capabilities, deliverables, a typical timeline, and resource requirements. Information on resources is further discussed in the “Do I understand who needs to be involved in the evaluation process” section below. The important thing to remember is the goal of the RFI — to determine the capabilities of each vendor and if they can potentially meet your ICD-10 financial Developing and issuing the RFP.
Now that you know who the ICD-10 financial risk assessment players are, how well their capabilities align to your organization’s objectives, what the outputs are of each solution, and who needs to be involved in the process, it is time to put together your RFP. Unfortunately, this is where many buyers make the mistake of relying on old, irrelevant software RFPs to evaluate ICD-10 financial risk assessment services.
With all of the work and time that it takes to create an RFP, the real purpose of the process—to objectively evaluate vendors—becomes diluted when ill-suited questions are included. While some questions can be repurposed, like those about corporate viability and size, others have to be completely retooled to effectively evaluate each ICD-10 financial risk assessment solution.
To help you develop your ICD-10 financial risk assessment RFP, a list of possible questions/requirements is included at the end of this article. This list is not indented to be exhaustive and does not include any assumptions, pricing language, general vendor qualifications questions, architecture/systems questions (beyond interfaces and file extracts), or terms. Rather, it is designed as a base line for the kind of questions that you will want to incorporate into your RFP. Every organization is different and has specific objectives for their assessment. Your questions should reflect your organization’s unique needs and goals for the project.
One last note about pricing
Evaluating price is one of the hardest things to do. Most buyers will immediately throw out the highest and lowest bids as a matter of initial vetting. However, in the case of ICD-10 financial risk assessments, this shouldn’t always be the case. Because this is a new space, the pricing is not yet mature.
There may be wide variances in price and factors such as cloud hosting that can significantly influence cost. So, before flipping to the pricing page or sheet, read through the response to see if the ICD-10 assessment solution provided fits with your organization’s needs and objectives. You may even want to take a page from the public sector and evaluate the price independently from the technical proposal.
Use your business sense and resources because when it comes to ICD-10 financial risk assessments, it is about finding the solution that best meets your needs while delivering the most value.
Dwan Thomas Flowers, MBA, RHIA, CCS, AHIMA-approved ICD-10-CM/PCS Trainer and a senior health information consultant for Deloitte, and Paresh Shah, CEO of MindLeaf Technologies contributed to this article. This article is the result of a collaboration between Jvion and HIMSS ICD-10 Playbook and ICD-10 Task Force.