How Healthcare Contract Management Software Simplifies Value-Based Contracts

A new trend in healthcare is emerging. Around the U.S., providers are implementing value-based contracts, which focus on quality of patient care rather than quantity of health services. In fact, 60% of today’s healthcare payments are tied to value and quality.

The goals of value-based contracts are noble, and the benefits are far-reaching. However, on the insurance or “payer” side of the healthcare industry, significant advancements in infrastructure are often needed to support the additional processes and complexities that value-based contracts bring to the table. As more healthcare providers adopt an outcome-based approach to medicine, payers that continue using manual or paper-based methods of contract management will face greater inefficiency.

In this post, we’ll highlight the advantages of value-based care and discuss a few ways that healthcare contract management software can provide your organization with an easier and more cost-effective way to support a healthcare model that benefits everyone—from healthcare professionals to the communities they serve.

Key takeaways

• Healthcare contract management software helps insurers manage the complexity of value-based contracts by automating workflows and reducing manual processes

• Value-based care shifts healthcare from fee-for-service to outcome-based payments, requiring more sophisticated contract management

• Digital solutions can reduce contract cycle times by up to 80% and cut administrative costs significantly

What is healthcare contract management software?

Healthcare contract management software is a digital solution designed specifically to handle the unique contracting needs of healthcare organizations, including hospitals, insurance providers, and medical groups.

These platforms automate the creation, negotiation, execution, and management of healthcare agreements—from provider contracts and insurance policies to vendor agreements and compliance documentation.

What makes healthcare contract management software different:

• Industry-specific features: Built to handle HIPAA compliance, value-based payment structures, and healthcare-specific contract clauses

• Integration capabilities: Connects with healthcare systems like EHR platforms, claims management systems, and billing software

• Specialized workflows: Manages complex multi-party agreements common in healthcare (payer-provider contracts, bundled payment agreements, etc.)

Healthcare contract management software is often powered by contract lifecycle management (CLM) technology, which provides the underlying platform for automating contract processes across any industry. Think of CLM as the engine, and healthcare contract management software as the specialized vehicle built for healthcare's unique terrain.

For insurance providers managing value-based contracts, this specialized software becomes essential. It handles the increased complexity of outcome-based agreements while reducing the administrative burden that comes with manual, paper-based processes.

What are value-based contracts?

The concept of value-based care is simple: patients and insurers should only pay for outcomes that are achieved. According to the Centers for Medicare and Medicaid Services, value-based healthcare can also include any program that “rewards health care providers with incentive payments for the quality of care they provide.”  

Traditionally, healthcare has operated under a fee-for-service (FFS) system, which rewards quantity—not quality—of healthcare. Most healthcare providers, patients, employers and insurers agree that it’s time to migrate away from a model motivated by increasing the quantity of healthcare transactions towards one based on positive outcomes and motivated by quality of service. It won’t happen overnight, but the end goal of value-based care and value-based contracts is to create a sustainable healthcare environment that provides the best patient outcomes for the best price. 

Why should health insurers care about value-based contracts?

Outcome-based agreements are complicated. The process of evaluating patient outcomes isn’t as straightforward as providing a fee-for-service. For instance, how do you attribute patient outcomes to one physician when a patient has more than one provider? Or, how do you determine whether a future illness is related to specific past treatment? 

All of these contingencies require careful documentation. As a result, contracts and payment structures become difficult to manage. If your organization relies on paper-based agreements, payment cycle times can increase by weeks or even months under a value-based payment structure. 

Healthcare organizations still face an enormous administrative burden, which directly impacts their ability to execute VBCs efficiently. In fact, healthcare organizations waste an estimated $262 billion annually on administrative complexity—a major contributor being the inefficient manual processing of documents and agreements. Given the rapid adoption of value-based contracts by healthcare practitioners, this cost is likely to increase in the coming years. In response, healthcare organizations will seek insurance partners that can draft, organize, and execute payment or compliance contracts efficiently and effectively.

How healthcare contract management software simplifies value-based contracts

Value-based contracts are complex by nature. They require careful tracking of patient outcomes, attribution to specific providers, and payment structures tied to quality metrics rather than simple service counts.

If your organization still relies on paper-based agreements or manual processes, payment cycle times can stretch by weeks or even months under a value-based payment structure. That's unsustainable as more providers adopt outcome-based care models.

Healthcare contract management software provides insurers with the framework they need to efficiently and cost-effectively manage even the most complex value-based agreements. Here's how these platforms transform the contracting process:

Strengthen client relationships 

With an automated workflow management solution, you can dramatically reduce cycle times, simplify complex agreements, and support a better payment process for your healthcare partners—which will improve providers’ and patients’ experiences and strengthen your business relationships.

Reduce administrative costs 

With automated workflows, payers save time and money from reduced contract cycle times. No more going back and forth endlessly through email and Microsoft Word while employees spend time tracking changes, obtaining signatures and managing documents. Additionally, costs are reduced by a more effective contracting process.

Support the digital front door

Value-based care is increasingly consumer-centric. Modern platforms support this strategy by offering mobile-friendly transactions that meet patients where they are, a critical capability given that more than a third of transactions are now completed via mobile.

Increase visibility 

Digitizing and storing your contracts in one centralized, cloud-based repository means you can find any agreement instantly. No more wondering which folder contains the current version or who has the signed copy.

Healthcare contract management software gives you real-time visibility into:

• Contract status and approval progress

• Key dates and renewal deadlines

• Payment terms and performance metrics

• Compliance requirements and documentation

This visibility becomes critical when managing hundreds or thousands of value-based agreements with different terms, metrics, and payment structures.

Eliminate errors 

Using email or Microsoft Word to review and approve contracts drains resources and leads to costly errors during the agreement generation and approval process.

After auditing one major health insurance customer, errors were identified in 87% of manually managed agreements. That's not a typo—87% of contracts had mistakes when managed manually.

Workflow automation streamlines and refines complex agreement processes by completely eliminating cumbersome manual document management. The result: fewer errors, faster processing, and more accurate contracts.

Improve interoperability

Value-based contracts rely on data from various sources across the healthcare ecosystem. Modern platforms offer over 1,000 integrations—including Microsoft, Google, Veeva, and Salesforce—ensuring that critical data flows seamlessly between systems rather than getting stuck in silos.

How can Docusign IAM help?

Traditional Contract Lifecycle Management (CLM) was the first step in digitizing the contract engine. However, value-based care requires more than just digital signatures; it requires Intelligent Agreement Management (IAM).

The Docusign IAM platform helps healthcare payers and providers move beyond disconnected legacy systems. By unifying the entire agreement process, organizations can:

• Automate workflows: Create custom workflows with Docusign Maestro that connect roles and data to speed up provider credentialing and payer relations.

• Gain real-time insights: Centralize agreements in a smart repository with Docusign Navigator to surface insights into payment terms and performance metrics, mitigating financial risk.

• Ensure trust with AI: Use proven AI (Docusign Iris) designed for high regulatory scrutiny, ensuring PHI remains secure while supporting HIPAA compliance.

This shift toward intelligent management delivers tangible results. For example, the South Carolina Department of Health—a Docusign customer—replaced manual tasks with digital alternatives, helping the organization save $2.4 million and eliminate 2.85 million paper documents in the first year alone. By accelerating completion rates and cutting time to value by as much as 80%, intelligent agreement tools help drive revenue collection without depleting resources.

Docusign lets you prepare for the future of insurance contracts

As the adoption of value-based contracts continues to increase, it’s up to healthcare insurance providers to solve for the practical consequences of increasingly complex agreement workflows. Docusign CLM helps ease the transition for health insurance providers by automating the most labor- and cost-intensive aspects of the healthcare payment process.

Learn more about how Docusign CLM can help prepare you for the future of healthcare today.