What is coverage analysis in clinical research?

Meghan Hosely
August 18th, 2020

Billing compliance in clinical research is critical to a successful trial. The consequences of not following compliance standards are severe, potentially costing institutions millions of dollars, as well as affecting their reputations. Almost every area of a study is negatively impacted when an institution fails to build a compliant billing process.

Performing a coverage analysis is key to ensure correct billing. Coverage analysis is a review to determine if a research study is eligible to receive Medicare coverage, outlining what items and services performed as part of the research study should be billed to Medicare. The coverage analysis is a vital component of the study activation process, and can save sites time, money, and their reputation in the future.

This infographic breaks down consequences to non-compliance, as well as offers solutions to avoid non-compliance in the future.

Coverage analysis infographic

Text Version

What is billing compliance in clinical research?

Billing compliance ensures all services in a trial are paid for, working to reduce double billing and preventing billing services not covered by the trial or are not medically necessary for the participant1.

How does non-compliance happen?

It is largely due to lack of understanding2. The clinical billing requirements that must be met include:

  • No double billing at the site level
  • Medical documentation supports coding
  • Research modifiers, diagnosis codes, condition codes, and NCT# (National clinical trial number) must be in place
  • Transparent documentation from the sponsor

Areas of clinical research affected by non-compliance:

  • Patient care
  • Billing
  • Accounting/Finance
  • Public relations
  • Legal
  • Grants/Contracts

Non-compliance can also be costly to an organization. From the False Claims Act Cases, the Justice Department recovered in settlements:

  • Over $3 billion in 20193
  • $2.8 billion in 20184
  • $3.7 billion in 20175
  • More than $62 billion since 19863

Additionally, some sites have filed settlements, and the fines show just how much organizations are affected. Sites have settled for improper billing or overbilling for fines up to $3.39 million. In addition to the fines site faced, a site’s reputation can face severe backlash following the settlements2.

The punishment for violating the False Claims act is hefty – it is up to 3 times the amount of the initial violation, and an additional penalty of up to $21,916 per violation6.

In 2016, US hospitals submitted $3 trillion worth of medical claims; $262 billion of the charges were initially denied7.

  • 63% of these claims eventually recovered, however, it cost hospitals an average of $118 each claim to dispute, or $8.6 billion in total in administrative costs.

What is coverage analysis?

Coverage analysis is a review to determine if a research study is eligible to receive Medicare coverage and outlines what items and services performed as part of the research study should be billed to Medicare.

Questions coverage analysts answer:

  • Is my institution at risk of billing compliance problems?
  • How are we paying for this service?
  • Does this study even qualify for Medicare coverage?
  • How will the billing process effect your patients?

What to look for in your coverage analysis team:

  • Knowledgeable, committed, and professional
  • Deep expertise
  • Customized solutions
  • Region-specific
  • Rapid turnaround
  • Unmatched value

Sources

  1. https://forteresearch.com/news/billing-compliance-basics-what-clinical-researchers-should-know/
  2. https://acrpnet.org/2016/03/04/clinical-trial-billing-errors-generate-multi-million-dollar-fines/
  3. https://www.justice.gov/opa/pr/justice-department-recovers-over-3-billion-false-claims-act-cases-fiscal-year-2019#:~:text=The%20Department%20of%20Justice%20obtained,the%20fiscal%20year%20ending%20Sept.&text=Recoveries%20since%201986%2C%20when%20Congress,total%20more%20than%20%2462%20billion.
  4. https://www.justice.gov/opa/pr/justice-department-recovers-over-28-billion-false-claims-act-cases-fiscal-year-2018
  5. https://www.justice.gov/opa/pr/justice-department-recovers-over-37-billion-false-claims-act-cases-fiscal-year-2017
  6. http://www.bumc.bu.edu/crro/files/2017/12/Samet-CRRO-Seminar-12-13-2017.pdf
  7. https://www.healthcarefinancenews.com/news/change-healthcare-analysis-shows-262-million-medical-claims-initially-denied-meaning-billions

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