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Why Vendor Credentialing is a Strategic Issue

 |  By Philip Betbeze  
   June 28, 2013

Intermountain Healthcare has become a big believer in automated vendor credentialing programs, not only as a patient safety and compliance solution, but as a way to make sure that vendors are meeting their business agreements.

Before 2006, nurses and frontline staff at Intermountain Healthcare's flagship LDS Hospital recognized it had a problem with vendor representatives going in and out of the hospital to service accounts and physicians.  

There was no way to know whether these folks had the required immunizations and background checks to allow them into sensitive patient care areas. So Intermountain cooked up a solution. It started requiring vendor reps to check in every time they visited, and to present their immunization records on arrival. The storage mechanism for such paperwork: Rubbermaid plastic tubs.

"That was not ideal, and it was a very manual process," concedes Joe Walsh, assistant vice president of procurement at Intermountain Healthcare, Salt Lake City-based LDS Hospital's parent. To complicate matters, other Intermountain hospitals each had a different way to deal with vendor credentialing.  

Lately, though, Intermountain has become a big believer in automated vendor credentialing programs not only as a patient safety issue, but as a way to make sure that vendors are meeting their agreements with the hospital and health system on what areas they're allowed to visit, and critically, what they're allowed to peddle on premises.  

Seven years ago, some LDS nurses had the right idea, Walsh says, before senior leadership or physicians were even aware there was a potential big problem with patient safety and liability. Even in 2006, vendor credentialing was a known issue, but with so many competing priorities, and the very good likelihood that physicians would resent the red tape their suppliers would have to go through to access them, many hospitals dragged their feet on implementing a comprehensive, less labor-intensive process for vendor access.  

But that's when Intermountain, intrigued by the patchwork system developed at LDS, decided to try to automate the process and roll it out to its other facilities. Jo Ann Autenreib, who became the supplier access program manager, was put in charge of making the transition.  

"She didn't have much more direction than that," says Walsh. Autenreib pulled together the heads of the supply chain, compliance, and the CMO, who handles physician relationships, to buy in. Product and vendor compliance got the supply chain folks hooked. And compliance was interested in identifying people with background problems and the idea that unfettered access was a patient safety issue resonated with physicians.  

Fast-forward to 2013, and Intermountain has a vendor access program in all its facilities using Reptrax, a program from Dallas-based Intellicentrics. Reptrax tracks suppliers' whereabouts through an ID badge and ensures that representatives of vendors and suppliers are who they say they are, have the proper immunizations, background checks and drug tests, and that they have the appropriate training and policy instruction.  

Over the past five years, the Centers for Disease Control, the Department of Health and Human Services, and The Joint Commission have changed their definition of "healthcare personnel" to include "unpaid" individuals, which brings vendors and suppliers into the same patient safety regulatory classification as staff—one reason vendor tracking has become so important.  

But there are good business reasons to employ such advanced tracking systems for vendors, too. The program gives hospitals an eye on whether their vendors are following agreed-upon rules of engagement.  

"We require all of them to check in before they come in so we have a record," says Walsh. "And every time we sit down with a major supplier, we go to the database and see if they are selling products they are not authorized to sell so we can have a fact-based discussion about management of our account. Those are the unspoken benefits of this program."

It costs Intermountain less than $75,000 per year to operate Reptrax, but Walsh acknowledges that vendors, who pay to use the service, probably feed part of that cost back to Intermountain through pricing.

"But that's perfectly acceptable," he says, largely because the program has already proved its worth by indentifying live TB viruses as well as by finding three instances of vendor reps with sexual offenses in their backgrounds, including one who had a sexual offense involving children and was seeking access to the children's hospital.

"Preventing just one of those events makes it worthwhile," says Walsh.

Despite all that, for Intermountain, it wasn't so much a regulatory or liability issue.  

"This wasn't so much about meeting regs," says Walsh. "Most of those frankly can be met manually and a lot of workarounds are well within compliance, but are obviously not optimized. What people don't talk about very often is that not only are we keeping our environment safe, but we now know who's coming into our facility."

Vendors, and at first, doctors, who were concerned about the cost and red tape their vendor representatives were going to face with the system, resisted. Some of that resistance was understandable, says Walsh, given the fact that many hospitals have vendor credentialing programs, but there's wide variation in what they require, and costs add up for vendors.  

But those objections were overcome with evidence of the patient safety benefits, and as hospitals have been directed to keep a closer eye on visitors by regulatory bodies. There is still the issue of standardization, however, as vendors often have to maintain records for a variety of different vendor credentialing systems that their clients use.

Autenreib and Walsh are active nationally in helping to try to improve standardization.

"It's OK to have competitive systems, but if we can share best practices and policies and procedures, the whole industry benefits," says Walsh. "We're taking the proactive steps. We're not trying to be confrontational with our suppliers."

Walsh contends that vendor credentialing is not just a back-office priority that doesn't have the attention of the executive team.  

"It's strategic because we're all in the business of patient care and we can't forget that," he says. "If we can prevent harm or problems from coming into our environment, we have an obligation" to do so.

Philip Betbeze is the senior leadership editor at HealthLeaders.


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