Different types of contract are used in healthcare industry for different purpose. Contract between hospital and its employee help to clarify on salary, benefits schedule and rules and regulation of the job. Similarly contract between hospital and vendor include term and conditions like time of delivery, price, supplies and schedule of service. A sound contract plays a very important role to maintain the laws and reduce a serious financial damage. It helps to acknowledge the right and responsibility for both parties. A sound contract might be different from institution to institution. According to Financial Institutional Letter by fdic.gov a sound contract always contains following terms and condition that should be followed by both parties
