Deal or No Deal: Managing Vendor Relations & HMIS Contracting

Transcription

1 Deal or No Deal: Managing Vendor Relations & HMIS Contracting Michelle Hayes, Cloudburst Consulting Group Jeff Ward, El Paso Coalition for the Homeless September 17, 2007

2 Learning Objectives 1. To understand the common provisions of HMIS software and management contracts. 2. To understand the opportunities and risks inherent in HMIS contracting. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 2

3 Overview Types of Contracts Source Documentation Definitions Disclaimer Uses of HMIS Grant Funding Local Procurement Practices HMIS Management Contracts Contracting Pitfalls HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 3

4 Types of Contracts HMIS Software Contracts Hosting Software Licensing Service/Support Contracts Software Development* HMIS Management Contracts Project Management Implementation support system administration/technical assistance/training Reporting, performance measurement, analytics *Note- HMIS software development is not an eligible use of HMIS grant funds and therefore will not be covered in this training. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 4

5 Source Documentation Requests were made for input from HMIS solution providers and several communities that have either developed their own software in-house or use a local software developer Review of existing sample HMIS vendor contracts Information from the private sector HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 5

6 Definitions for Presentation For the purpose of this training: Vendor/Licensor refers to the entity that is providing the service or software (i.e., HMIS Software Vendor) Client/Licensee refers to the purchaser of service (i.e., CoC or HMIS Grant Administrating Organization) Contract/Agreement refers to the legally binding document for provision of a product or service that includes terms and conditions, fee schedule, services, etc. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 6

7 Disclaimer The presenters are not lawyers and information provided in this presentation is intended to provide best practice examples Note of caution No community or vendor should execute a contract without appropriate legal representation Each CoC, HMIS Implementation, Software Application, Vendor Organization, etc. is DIFFERENT the recommendations contained herein may not apply to all scenarios and are intended to cover the broad view of contract components HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 7

8 Reminder Uses of HMIS Grant Funding Eligible Costs: Purchasing/licensing HMIS software Leasing or purchasing computer equipment Staffing Services (customization, hosting/technical services, training by third parties, etc.) Space & Operations Ineligible costs: HMIS planning includes all costs incurred prior to implementation of new or replacement HMIS software Development of new software Replacement of state and local government funding of an existing HMIS If SHP funds are used to fund vendor contracts (i.e., software or service), the contract should not exceed the terms of the SHP grant agreement HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 8

9 Eligible Uses of HMIS Grant Funds Software Purchase or licensing of off-the-shelf HMIS software is eligible use Software/application should already be developed, include necessary reports like APR and AHAR and be in use by other CoCs for HMIS Additional customization of the software/application is eligible (adding fields, response categories, local reports, etc.) Software development (i.e., building new software or making non-hmis software HMIS compliant ) is not an eligible use HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 9

10 Eligible Uses of HMIS Grant Funds Replacement Software Purchase of replacement software or application licensing fees is an eligible cost HMIS grant funds should not pay for more than one HMIS software or application licensing fee at a time Migration of data from one system to another may be eligible for specific circumstances as approved by HUD Headquarters Costs related to planning for replacement software (i.e., software research, RFP process, vendor demonstrations, etc) are not eligible HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 10

11 Procurement Practices Federal procurement requirements: Grantees must have a written procurement policy and procedures for spending Procedures: Ensure that unnecessary purchases are not made Determine the most economical and practical procurement Solicitation for goods and services must meet requirements outlined in 24 CFR (public agencies) or 24 CFR (non-profit organizations) HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 11

12 Procurement Practices (cont.) Local, agency or CoC procurement policies for purchase of software licensing/services may apply when developing a contract and may require: Formal, advertised, competitive bid process (i.e., Request for Proposals); Minimum number of bids (i.e., at least 3); Procurement from a specified list of vendors; and/or Authorization procedures from a higher authority before executing a contract. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 12

13 Key HMIS Contract Provisions General terms and conditions Services (i.e., what you are purchasinglicensing, hosting, etc.) Infrastructure requirements (i.e., local requirements for hardware/software) Terms of payment/costs Other conditions (i.e., boilerplate components) HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 13

14 General Terms and Conditions Duration Definitions and terms Start Date Typically tied to contract date with software setup/delivery within a stated time Consider penalty or escrow provision to assure timely deployment Duration Consider alignment with grant cycle (12,18, 24 months) Warning against long term contracts (>24 months) without annual review of terms/conditions for re-negotiation Many contracts found to have automatic oneyear renewal clause with a 30-day written cancellation policy HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 14

15 General Terms and Conditions Termination Termination or Suspension of Service by Vendor/Licensor Non-payment (can also affect service availability) To protect the integrity of system Termination by Client/Licensee Cancellation typically requires at least XX days written notice May require payment of full terms of contract upon premature cancellation unless otherwise specified May request suspension due to security threat, breach, etc. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 15

16 General Terms and Conditions Termination (cont.) To protect your community in the event of termination of contract, ensure these provisions are included: Provision for delivery of data/equipment Cost of download and media storage Timeframe for data transfer Data validation protocol Data, hardware, media storage, and equipment disposal protocols Note: Early termination may require payment of full contract value before client can obtain copy of database HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 16

17 General Terms and Conditions Special Considerations Vendor may maintain the right to merge or sell business without the client approval or consent Client could request the right to 30-day notification of intent to sell with disclosure of purchasing party Limitations of Actions - no action arising out of contract can be brought more than 2 years after the cause of action has occurred Limitations on further use/distribution of 3 rd party proprietary information - i.e., no further copying, distribution, etc. of AIRS taxonomy terms/structure If vendor is required to meet HIPAA compliance it is typically addressed through a separate Business Associate Agreement and may not be included in the general software contract HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 17

18 Services* Features and Functionality Continuity of Service Access and Limitations of Use Ownership of Data Hosting Security and Maintenance Data Storage/Backup Data Recovery Training and Technical Support *commonly appears as Exhibit attachment to standard contracts and may be named Service Level Agreement HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 18

19 Services Features and Functionality Will differ with each application May be included as a separate exhibit and describe: Modular functionality Application components (client tracking, service tracking, etc.) Reporting specifications Compliance with current HUD and/or local reporting specifications (i.e., APR, AHAR, etc) Define payment and time frame for compliance for changes Add on features Housing management Information and Referral 3 rd party reporting software Other HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 19

20 Services Continuity of Service Contract should define appropriate response times and protocol for scheduled and unscheduled outages, after which penalties kick in Available service times Specified client access time to application Regular scheduled maintenance (typically two-hour window nightly when servers can be updated; patches loaded; backups scheduled) Service Outage/downtime Definition: at least XX minutes during which the application is not available and unscheduled Notification of non-routine maintenance Remedies for excessive outage/downtime Proration of fees, financial penalty, credit, etc. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 20

21 Services Access Access controls Levels of access User authentication Workstation authentication (PKI or IP Filtering) Policies/protocols for client management of end user access rights Minimum training requirements, background checks, user privacy agreements, etc. Licensing for ASP is typically limited to one license per user and prohibits sharing of licensing Ability to receive a copy of database (i.e., for aggregate reporting outside of HMIS product) Protocol for requesting a copy of the database at any time Non-interference with pre-scheduled vendor maintenance and upgrades HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 21

22 Services Limitations of Use Typical clauses that protect the intellectual property of the vendor application development Limit use by or for the benefit of anyone other than the client or licensee Prohibition to re-license, sell rights to access, transfer or assign rights to access or use Prohibition from modification, duplication, translation, reverse engineering, or creating derivative works based on the application or its source code Prohibition from unauthorized access to, use or duplication of any of the source code Compliance with applicable laws, intellectual property and copyright laws HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 22

23 Services Ownership of Data Vendor assures ownership to Client; Client to participating agencies May also specify Client/licensee grants access to vendor for use for system administration, technical support, auditing, research, and compliance with applicable legal and regulatory requirements HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 23

24 Services Hosting Options: In-house or through professional hosting facility Specifications 24/7 monitoring and management of hardware, O/S, web server and/or database server Back-up services and power source (i.e., UPC) Minimum Internet bandwidth and IP specifications Servers may not be used for illegal purposes or in support of illegal causes Physical security specifications HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 24

25 Services Security and Maintenance Physical security of locations where data are stored/accessed locked room/cage limited access by pass-card or key-code System Security (O/S, Application and/or Web Server) Compliance with minimum specifications of HMIS Standards (firewall, encryption transmission, PKI, etc.) Regular maintenance protocols for O/S, web server and/or application upgrades, patches, etc. Specifications for notification of breach, security violation, or other malicious act by both parties HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 25

26 Services Data Storage and Backup Data storage Server location Access to servers Media format Segregation (i.e., stored on same server as other databases) Data backup Regular backup schedule (daily, etc) and media format Location for storage of regular (daily) backups Length and location of prior backups (i.e., maintain daily copy for 7 consecutive days and then re-write; maintain master weekly/monthly backup) Data mirroring via replication offsite or hot backup onsite Test your backup protocols regularly HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 26

27 Services Data Recovery In the event of loss of service, data, corruption, natural disaster, etc. BE PREPARED WITH A PLAN THAT HAS BEEN TESTED Backups: Secure the most recent backup copy of the data (mirrored site) Location: Reinstate hosting site or establish service at an alternate site/server (hot-site) Server: Bring new server online and restore data Test the restored server/data Allow limited access for brief period of time to test use, access, etc. Open to full access upon validation of use test HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 27

28 Services Training Standard services offered Start up Ongoing Upgrades/customizations Cost and offerings for optional training HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 28

29 Services Technical Support Standard Support Point of contact service representative / vendor liaison Hours of availability of service Customer service request tracking system and period of response/resolution Customer service request escalation protocol System maintenance and Internet service support Regular application releases and updates HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 29

30 Services Technical Support (cont.) Product/Application Specific Definitions of roles and responsibilities Could include job description and qualification of HMIS system administrator/super user and/or client vendor contact; grievance officer Standard support available to HMIS staff Help desk for end users Explicit term of support for the product/version (i.e., 2 years before it becomes unsupported or ineligible for upgrades) HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 30

31 Infrastructure Requirements Hardware Software Communication and escalation protocols Roles and responsibilities Organizational preparedness what needs to be in place prior to obtaining access? HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 31

32 Terms of Payment and Cost Standard fees, charges, fee schedule Definition of what is included in base price, version upgrades (minor/major), add-ons, etc. Licensing specifications and cost Dedicated/concurrent Minimum agency requirements (i.e., at least one per agency no sharing, etc.) Fee Schedule Licensor reserves the right to increase the monthly service fees annually by no more than XX% Consider using a benchmarking clause in long-term contracting that gives buyers the right to have vendor s prices reviewed by a third-party auditor prices found to be noncompetitive are enough to require re-negotiation HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 32

33 Other Provisions Standards Compliance Data Standards Compliance Not enough to simply say be compliant with HMIS Data and Technical Standards Need to define whether expenses incurred by vendor to maintain compliance are passed on to the client or whether they are absorbed by vendor and distributed via ongoing updates within period of contract Define window of time in which the vendor must be compliant (i.e., within XX days of publication of final notice) Industry Standards Compliance Maintaining currency with prevailing industry standards HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 33

34 Other Provisions Escrow Agreements The client has a right to request escrow of application source code and documentation with a vendor of their choice Recommended quarterly escrow Provides some protection if vendor goes out of business Arbitration Under the laws of the state of vendor organization Most require that disputes regarding validity of agreement be submitted to, determined, and settled by formal arbitrator and rules of the American Arbitration Association (AAA) HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 34

35 Other Provisions (cont.) Confidentiality Client and/or agency confidentiality protocol Typically the responsibility of licensee/client and may require vendor staff to sign specific client/user/agency confidentiality protocols Compliance with present and future federal, state and local laws and regulation regarding confidentiality of client records contained in or transmitted by vendor HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 35

36 HMIS Management Contracts Contracts with organizations/individuals responsible for the management of the HMIS and may include: Training Policy and procedure development Technical support Backup and recovery Compliance monitoring Reporting Risk management Other community level data needs HMIS management contract components will mirror many of the specifications of the vendor contracts including general terms, services, suspension, and termination clauses, etc. HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 36

37 HMIS Management Contracts: Qualifications Implementing software in another industry does not necessarily prepare you for HMIS each agency is diverse and has unique needs Strong project management and soft skills are just as important as the technical skills necessary to implement the system Past performance managing like or similar projects with verifiable references Same due diligence as selecting a software product should be applied in selecting an HMIS management entity HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 37

38 HMIS Management Contracts: Governance CoC is responsible for the HMIS implementation it is important to define the relationship between CoC and HMIS administering agency (and HMIS grantee when different than HMIS administering agency). This should include: Relationship with CoC Decision making authority Communication protocols Ownership of data and authority over data Public relations approval process Financial requirements Match? HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 38

39 HMIS Management Contracts: Deliverables Consider performance based contracting with incentives/penalties clauses Very important to detail the specifications of deliverables required under the contract including the detailed descriptions, deadlines, penalties, etc. Contract deliverables or scope of work should be reviewed and revised annually Performance should be monitored on regular basis through reporting specifications or progress reports to the CoC HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 39

40 What to do if you need to sever ties with a vendor The best answer is what NOT to do Don t act in haste- over a series of weeks or months, communicate your expectations, why they are not being met and what you intend to do about it. Create a paper trail. If the vendor is responsible for creating or maintaining any business-critical data or servicesdon t fire them before you're sure you have all documentation, copies of data, etc. Try not to be too public about voicing displeasure and shopping for a replacement vendor disgruntled IT systems or personnel can sabotage even the best intentions. Source: CIO.com June 11, 2007 HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 40

41 Contracting Pitfalls BEWARE OF VAPORWARE!!!! Do not just sign on the dotted line without Understanding what you are purchasing; and Conducting a thorough legal review. Be specific as to what you mean. Simply including a clause must be compliant with HMIS Data and Technical standards is not enough. Overambitious schedules If it seems too good to be true it probably is. Be realistic, learn realities from other implementations Protect yourself with incentives/penalties on meeting deliverables within deadline HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 41

42 Contracting Pitfalls (cont.) You get what you pay for the least expensive or free option may have alternate costs and may not deliver what you expected. Conversion from one system to another is the last resort Is it really the software? Most communities don t consider HMIS software absolutely perfect. Loss of time and momentum should be considered. Resources ($) to convert to a new software are not an eligible use of HMIS grant funds. Software transition should be your last resort! HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 42

43 Discussion Questions What experiences have you had? What challenges have you encountered? What are the lessons you learned that others should know about? If you already have a contract, what would you change? What would you do differently now that you didn t know then? If you are in the process of developing a contract, what would you ask someone with more experience? HMIS Grant Administration & Project Management Training The U.S. Department of Housing and Urban Development 43