Vendor Contracts

Vendor Contract Agreements

Policy

Vendor Contract Agreement Policy and Scope:

Sharon Regional Health System commits to the fair negotiation and administration of all Vendor Agreements to follow a standardized process as defined below.

Scope

This policy applies to all employees, contractors, and agents (each an “Agent”) of Sharon Regional Medical Center.

Note: This policy does not apply to Vendor Agreements where one or more physicians hold an ownership interest in the vendor. Any Vendor Arrangement with a vendor where one or more physicians holds an ownership interest in the vendor must be negotiated and executed in accordance with the applicable Sharon Regional Medical Center Administrative Policy on Physician Agreements.

This policy also is not applicable to employment agreements, agreements with physicians or physician practice groups, and provider and commercial space lease agreements. Please refer to related policies for physician Agreements and lease agreements.

Please note that LD 02 Approval and Monitoring of Contracts for Clinical Services applies to all relevant Vendor Arrangements.

Definitions

Agent: Individual that is requesting the Agreement

Business Owner: Lead that falls into Transaction Limit per FIN 24 Approval Authority and Signature Requirements for Financial Commitments

Business Associates: An entity or person, other than a member of the Workforce, who creates, receives, maintains, or transmits Protected Health Information (PHI) on behalf of a Covered Entity or provides services to or for a Covered Entity which requires the disclosure of PHI.

Business Associate Agreement (BAA): Language added to a service contract between a Covered Entity and its Business Associate

Entity: Each individual Hospital/Clinic

Protected Health Information (PHI): Information that identifies an individual, including genetic information, and concerns the 1) past, present, or future of physical or mental health, or condition of an individual; 2) provision of health care to an individual; or 3) payment for the provision of health care to an individual, unless that individual has been deceased for more than 50 years.

Vendor Agreements: For purposes of this policy, include, without limitation, contracts, addendums, rebates, term sheets, memoranda of understanding, vendor quotations, price lists, trial forms, capital placement and reagent rental, goods and services agreements, instrument repair, equipment maintenance, Medical/Surgical/Pharmaceutical purchase, call services, leases, with any party other than Sharon Regional Medical Center.

Procedure

Please refer to related policy FIN 24 Approval Authority and Signature Requirements for Financial Commitments for levels of authority required to approve and execute Financial Commitments made on behalf of Sharon Regional Medical Center and to prevent persons from entering Financial Commitments on behalf of Sharon Regional Medical Center without the appropriate approval or authority.

1. Review Proposed Agreements

Agent must review all proposed Vendor Agreements with the appropriate Business Owner for potential inclusion in existing or proposed Sharon Regional Medical Center Vendor Agreements, enforcement of Sharon Regional Medical Center standard contract terms, and to confirm that no current Sharon Regional Medical Center Vendor Arrangement exists with a Supplier or a competing Supplier for the proposed Vendor Arrangement.

2. Business Associate Agreement

Agent, as appropriate, must provide Sharon Regional Medical Center template Business Associate Agreement (BAA) for the proposed Vendor Arrangement. Instructions for Business Associate Agreements are found in Policy COM 34 Disclosure of Protected Health Information (PHI) to Business Associates (Exhibit A).

3. Use Standard Templates

Agents must use Sharon Regional Medical Center Agreement template instead of Vendor documentation. Other than approved options, agreement template, including Sharon Regional Medical Center Business Associate Agreement, may not be modified in any way absent the approval of the Office of General Counsel. If Agent is utilizing a non-Sharon Regional Medical Center agreement, contract terms must be consistent with Sharon Regional Medical Center’s standard contract terms before it goes to Office of General Counsel for approval. Those terms include:

  • 60-day net payment clause
  • Contract can be terminated without cause within 60 days
  • Sharon Regional Medical Center does not agree to pay late fees on past due invoices
  • Indemnification
  • Liability
  • At discretion of Sharon Regional Medical Center Counsel

4. Negotiation Assistance

Agents must contact the appropriate Business Owner for negotiation assistance with any Vendor Arrangement with a total potential annual contract spend in ordinance with each Business Owners signing limits (FIN 24) for appropriate business owner per signing limit) and if PHI is involved, a BAA must be executed. The Business Owner or the Office of General Counsel may negotiate any pricing or other terms and conditions they deem appropriate with a contracting vendor.

5. Approval Requirements

ALL Vendor Agreements and BAA documents (if applicable) must be approved by the Business Owner before any document can be signed committing Sharon Regional Medical Center to that Vendor Agreement.

6. Supply Chain Process

Supply Chain business plans and Supply Chain Vendor Agreements are to be sent to hospital Director of Materials Management and/or designee by hospital CFO who in turn will gather and upload all required information to the Value Analysis Pipeline on the Supply Chain Service Center SharePoint site for review.

7. Information Security Review

Any Supply Chain contract containing a potential information security risk must be reviewed and approved by Sharon Regional Medical Center’s Vendor Risk Management Team as found in Policy EISP 15 Vendor Risk Management Policy.

8. Electronic Signatures

Approved Vendor Agreements, Purchase Orders, and any related documents may be signed and accepted in electronic form (e.g., by an electronic or digital signature).

9. Final Terms

After the final terms of a Vendor Agreement and BAA have been approved by the Business Owner or the Office of the General Counsel, the document memorializing that Vendor Agreement and/or BAA may not be modified in any way.

10. Implementation

No Vendor Agreement may be implemented (e.g., any provision of services or payments of any kind) prior to obtaining all necessary signatures and approvals representing final execution of the Vendor Agreement and BAA (if applicable). Refer to COM 34 Disclosure of Protected Health Information to Business Associates for questions on business associates.

11. MMIS Requirements

For Supply Chain Vendor Agreements Only: Supply Chain reserves the right to prohibit the implementation of certain contracted products in the Materials Management Information System (MMIS) if by doing so would introduce redundant functionally equivalent products or create the potential for disparate standards of patient care. All products in the MMIS must be on an active Vendor Agreement per the process outlined above. The use of miscellaneous MMIS item master numbers to order supplies is prohibited.

12. Emergency Supply Chain Situations

In the event of an emergency Supply Chain situation as defined below, the facility Materials Manager can file an emergency VA Pipeline requesting the use of a non-contracted item.

a. A situation is considered an emergency if one or more of the criteria is met:

  • Non-elective surgical procedure whereby the patient’s life would be negatively impacted if they were not treated with the requested product(s)
  • The patient presents with existing implant(s) that requires proprietary products from the same manufacturer

b. The emergency VA Pipeline submission must contain ALL the following:

  • A detailed description of the Supply Chain emergency including when it first surfaced and what supply chain criteria is being met
  • Documented approval by the hospital CFO allowing the use of the non-contracted item
  • The cost of the requested product(s) as well as the cost of alternative products already in the MMIS
  • A compelling clinical reason why an existing product in the MMIS cannot be used

c. Emergency VA Pipeline requests can only be approved by: Chairman/CEO, President SRMC, Sharon Regional Medical Center Chief Operating Officer, Sharon Regional Medical Center Chief Financial Officer, or Senior Vice President of Sharon Regional Medical Center Supply Chain Management. If the request is approved Sharon Regional Medical Center Supply Chain will provide detailed, written instructions for ordering the product.

13. Document Management

Upon execution of any Vendor Agreement and BAA authorized and approved as described above, a copy of the fully executed Vendor Agreement, Business Owner Form (found on page 19) and BAA shall be provided in PDF form and forwarded to the correct Business Owner to load into the contract database.

a. https://sharonregionalmedicalcenter.sharepoint.com/sites/contracts/supplychain/Pages/VAPipeline.aspx b. The Supply Chain Database will also hold all Vendor Agreements at this time.

14. Record Retention

Any Sharon Regional Medical Center entity that is responsible for administering the Agreement with the vendor shall retain or be provided a copy of the Vendor Agreement and BAA for its records. Each Regional Business Owner should keep an excel document or a way to keep track of their agreements and information from their BAA template to be quickly given to SRMC Compliance in case Sharon Regional Medical Center is selected to be Audited.

Per the HHS.gov website, auditees will be requested by OCR to identify and provide detailed information regarding their business associates. Sharon Regional Medical Center will have a maximum of two weeks to provide this information to the OCR.

15. Compliance Monitoring

The Sharon Regional Medical Center entity responsible for administering the Vendor Agreement shall be responsible for ensuring compliance with notice requirements, including those for renewal periods and expiration dates.

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