Perhaps you remember playing with building blocks when you were a child or, at least, have seen a child building a skyscraper reaching from the floor to a height greater than a coffee table.
Creating, and maintaining, a contractual relationship is like that, with deal-point building blocks forming the agreement. Sometimes a block can be left out or even removed safely. But, often, an absent block deforms the structure. Pulling the wrong one out, or allowing someone else to do so, can result in the whole structure crashing down, perhaps on your head.
This holds true whether we’re talking about contracts between medical groups and physicians, between hospitals and medical groups, and so on.
And, it applies both to the negotiation (and documentation) of a contractual relationship and to performance of it by the parties over time.
Sometimes it’s hard for the parties themselves to understand the significance of a particular building block. Is it essential? Is it just nice to have? Might allowing one to be pulled out be benign, but a second disastrous? Even if the crash isn’t instantaneous, is it inevitable?
For example, consider the situation in which an ambulatory surgery center is negotiating with an anesthesia group for the renewal of a coverage agreement. The parties have been dealing with each other for over 15 years. Now, in connection with the negotiation of a revised form of the agreement for the ensuing two year term, the ASC wants to delete the integration clause, the provision that states, basically, that what’s in the written agreement is the whole deal. In that situation, is that a meaningless block, or the beginning of a tumultuous end?
Or, picture an arrangement between a medical group and a healthcare system. The agreement carefully defines the scope of services that are required (or perhaps fails to do so completely—a missing block). Then, over time, the system asks for a little more service here and a little more service there, a classic case of scope creep. The group, either asleep at the switch or afraid to speak up, bends to the system’s wishes. The increased burden puts strain on the group’s physicians, leading to burnout and resignations, which leads to increased burnout and more resignations, a medical group death spiral
For children, playing with blocks is fun. Pull out an integral piece and there might be some tears, but no real harm done.
For adults, each block in a deal can be the difference between success and failure.
Related Posts:
