Signs of a bad waste management contract

Are sneaky, predatory services contracts affecting your organizations bottom line? Are purchased services slowing draining your operating cash flows? If you don't think so you better look again! Just like a needle stick injury, a bad contract can be painless or unnoticeable until it's too late. To make matters worse, the biggest and most recognizable names in the medical waste industry are writing these kinds of blood sucking agreements every day. Here are 3 tell tale signs that your organization is getting a bad deal from your waste management contract.

Monitor and audit your service contractor consistently.

Nobody thinks about purchased services. It's true that when there is no problem we tend not to think about the small stuff such as purchased services and medical waste. This is the number one reason why so many health organizations find out after it's too late that they are stuck with a bad deal. Many times the contract constrictions can get worse as months go by with evergreen clauses

Medical professionals recommend healthy patients seek annual screening and physicals to stay healthy. So shouldn't you scan your organization's  relationships and service agreements and test the market to ensure organizational budgetary welfare? An ounce of prevention is worth a pound of cure. 

After paying close attention to your initial agreement and looking for some of the signs of a bad contract, take note of a timeframe that would be reasonable to check in and monitor how your contractors are performing. Look at variables that may be affecting your budget, time, or waste negatively and prepare to make any necessary changes when the time comes.

Know the landscape and compare alternative companies.

When considering changing your waste management contract, a major factor is knowing alternative companies that offer the same services. Most times, you may be working with what you believe is a “Trusted Name”. When it comes to medical waste services about 90% of all healthcare facilities are working with Stericycle. They are the only nationally recognized name in the medical waste business. However, their contracts have led to two decades of lawsuits for price gouging and other poor contracting practices.

Finding viable alternatives can be difficult because many local and regional service providers regularly sell out to larger companies like Stericycle as a business model. There are viable regional alternatives that are in business for the long run and to identify these companies they typically have the following characteristics:

    1. The company has been in business for more than 5 years and have clients vocally satisfied with services.
    2. They have some degree of vertical integration. They own trucks, a transfer facility, and even processing capabilities of their own. (keep a lookout for brokers)
    3. They are knowledgeable about more than just medical waste, your service provider should be able to help direct you with all EH&S subjects as a value adding service provider. 

Consult your waste management contract

With many waste management contracts, contractors expect you to sign with no protections built in for your organization or any guarantee of service satisfaction so you need to make sure when you sign you understand what your signing for. Does your service contract have any of this language:

    1. Your agreement is for more than 2 years and auto renews with a very slim window to exit
    2. Agreement contains monthly recurring fees or charges.
    3. Your invoicing is subject to fuel and environmental charges
    4. Language that allows for the service provider to bill you even when you don't have waste, or even worse when the driver leaves after 10 minutes because you were not ready for their pickup. 
    5. Automatic built in price increases every 6 months. 

The sad truth is that very few service companies are out to protect you, and it is important to test the integrity of your service provider by asking for things like a 60 day exit clause in your agreement, a best price guarantee, and some language that ensures that you as the purchaser of services maintain some power and leverage.

Conclusion

For far too long medical waste companies have had this sense of entitlement that you need them more than they need you. While its true that you need medical waste services, take your time choosing the right one. Take a 5 min google search with this article in mind and seek several viable alternatives. It's up to you to make sure your organization is not infected by parasitic service providers and crippling medical waste contracts. There are viable alternatives and it just takes a few minutes and a conversation to know you found the best fit. 

Let us know if you need help cancelling your contract.