As I've written before, there are three distinct types of RFPs for physician services:
1. True RFPs: These are genuine searches for the best-quality provider with a favorable ratio of quality to cost. This type of RFP is the closest in relationship to the traditional form used in industry and government. It is commonly seen in situations in which the current, or sometimes very recently former group, has "blown up" and can no longer provide coverage. It's also frequent in scenarios where the current group has completely lost the facility's trust.
2. Fictitious RFPs: These RFPs belie the fact that hospital administrators are not interested in the merits of any response; they have already decided to whom they will award the contract. Yet, for one political reason or another, they've decided to issue a phony RFP to project a patina of "fairness" to the medical staff, to the hospital's own board, to some third party-or perhaps to you.
3. Fulcrum RFPs: Consider this the weaponized RFP. As the name implies, the increasingly common fulcrum RFPs are designed to create leverage. The facility intends on renewing with the present group but uses the RFP as a tool to dictate terms by fiat and to pressure the group into negotiating against its own best interests out of fear of replacement. Nonetheless, the facility is open to competing proposals.
The problem is that from the group's perspective - any group's perspective even the one currently in place - it's difficult or impossible to know what type of RFP you're dealing with in any particular situation.
RFPs are a form of sealed bid auction; instead of potential buyers naming their highest price to acquire that heirloom diamond, potential sellers of the specialty medical service are naming their lowest price to acquire that gem of a contract.
And, no matter what their type, all RFPs come prepackaged with two significant defects:
First, just like in any auction, sealed bid or open, there's the high potential for what economists refer to as the "winners curse;" the fact that the RFP "winner" turns out to be a big loser when they realize they have under bid the necessary amount of stipend support.
Second, that gem of a contract that you just won may turn out to be not even a diamond in the rough: it might just be paste.
From the perspective of the group currently holding the exclusive contract, significant strategic and tactical work is required to reach Strategic GroupTM status and thereby create an experience monopoly, significantly reducing the chance that you'll become subject to an RFP.
However, in the event that the hospital does issue an RFP, whether you are the group in place or a group approaching from the outside, consider the fact that a complete, first-class response is time-consuming and expensive. And, on top of that, you may merely be used as a tool to negotiate someone else's stipend down, or as a tool to create window dressing for a decision already made in favor of another "bidder." Therefore, consider what your fee to participate in an RFP should be. Perhaps that fee is a credit against stipend support, perhaps not.
Last, you need to understand that some hospitals are simply looking for a commodity - the cheapest contract to provide your specialty services - that they can get. These are the bottom feeders, and they don't deserve you.
It really is a question of self-esteem.
