Selecting a Vendor for Disease Management Programmes

Many health maintenance organisations (HMOs) and provider organisations are developing disease management programmes to improve quality of care and lower costs for patients with chronic diseases. Many of these organisations ultimately decide to outsource these programmes to vendors rather than `build' the programmes themselves. Once the decision is made to outsource a disease management initiative, HMOs and provider organisations face the difficult and important task of selecting a vendor from over 100 companies offering disease management programmes. This article describes an effective vendor selection process. This process enables organisations to identify all potential vendors, efficiently narrow the search to a smaller set of companies likely to offer effective programmes and, ultimately, select a preferred vendor. The article emphasises the importance of achieving and maintaining physician support for the disease management strategy. It outlines how to use a provider advisory committee to enable physicians to provide input into the selection process and to enhance the likelihood of achieving physician support for disease management initiatives. Another critical element within the vendor selection process is evaluating the ability of vendors to deliver financial benefits to the client organisation. For many chronic diseases, competent vendors should be able to `guarantee net financial savings' - savings that are larger than the cost of the disease management programme. Finally, the vendor selection process can be complex and time consuming. Use of a structured procedure to identify vendors, conduct a `request for proposal' process, obtain provider `buy-in', select a vendor, and negotiate a contract can greatly accelerate efforts to outsource disease management programmes. In addition, this approach will increase the likelihood that the selected vendor will help an HMO or provider group achieve its goals with respect to patients with chronic disease.