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Clinical Trials Under Scrutiny

Keep safe by using coverage analysis as a good risk management strategy.

By Duwayne Barrett, MBA, RPSGT, CPC-P
Clinical trials are an end stage in the lengthy research process of finding better ways to prevent, diagnose and treat disease. Like all health care services, however, clinical trials (ICD-9-CM code V70.7 Examination of participant in clinical trial or ICD-10-CM code Z00.6 Encounter for examination for normal comparison and control in clinical research program) have come under increased scrutiny for billing errors and fraud. It’s times like these when organizations should enhance their risk management strategy to include coverage analysis that addresses appropriate billing for research.

Clinical Trails Aren’t Immune to Payer Scrutiny

As financial pressures increase, there is greater effort to root out fraud and waste by scrutinizing claims and payments for all health care services. The Obama administration’s 2010 Affordable Care Act dedicated approximately $1.5 billion to fighting health care fraud. In January 2011, the U.S. Department of Health & Human Services (HHS) announced that, as a result of efforts to prevent and recapture dollars lost to fraud or waste, the federal government recovered over $4 billion. The announcement also outlined additional regulations for fighting health care fraud that increase data sharing across government agencies, expand overpayment recovery efforts, and broaden oversight of private insurance abuses.
These new regulations could have a significant impact on how the Affordable Care Act is used to substantiate fraud allegations for items or services rendered in clinical trials. According to findings presented at the 2010 conference of the Region IV National Council of University Research Administrators, the organizations that have already paid out settlements related to CT billing errors include:

  • Spectranetics: $5 million settlement over false Medicare claims
  • New York University Medical Center: $15.5 million for inflated research grant costs
  • University of Alabama: $3.4 million for double billing
  • Palm Beach Imaging: $7 million for anti-kickback
  • Scripps Memorial Hospital: $29 million for violation of the False Claims Act

Avoid Five Specific Errors

Leaders in organizations performing or moving towards performing clinical trials should be acutely aware of the types of red flags government regulators are looking for. An effective risk management strategy will evaluate an organization’s vulnerability for conspicuous research billing errors, such as:

  • Double billing – billing the research participant’s insurer for services covered by the study sponsor
  • Upcoding – assigning a diagnosis code that does not match the recorded medical documentation to obtain participants; for example reporting ICD-9-CM diagnosis code 410.00 Acute myocardial infarction of anterolateral wall episode of care unspecified for heart attack (ICD-10-CM, I21.09 ST elevation (STEMI) myocardial infarction involving other coronary artery of anterior wall) when ICD-9-CM diagnosis code 413.0 Angina decubitus for angina (ICD-10-CM, I20.8 Other forms of angina pectoris) was actually documented
  • Billing for items or services that are not clinically necessary and for research purposes only
  • Billing for items or services that were outlined as free in the participant’s informed consent document
  • Billing for items or services performed as part of a nonqualifying trial

Research often occurs with routine care encounters, which adds to the potential for research billing errors. Your goal is to ensure items or services for routine care or research are billed to the appropriate payer, and in compliance with applicable regulations.

Take Four Steps Towards Research Billing Success

A good starting point for developing strategies to prevent clinical trial billing errors is detailed in “Risk Management in Health Care Institutions: A Strategic Approach,” by Florence Kavaler, MD, MPH, and Allen D. Spiegel, Ph.D., MPH. Focus on this four-step risk management strategy before committing to a clinical trial agreement and while developing coverage analysis techniques:
Risk identification involves collecting data about similar types of trials that could uncover liabilities to the patient or institution.
Risk analysis entails assessing the collected data to develop a tailored plan that eliminates or limits the impact of substantial liability.
Risk control and treatment is the most common step for risk management. Control and treatment is an institution’s response of implementing techniques to limit liability when incidents occur.
Risk financing is a comprehensive and retrospective review of the expenses required for the previous steps as well as funding losses associated with addressing potential incidents.

Cover Yourself with Coverage Analysis

Coverage analysis is a standardized method of reviewing and detailing the trial protocol to identify the responsible payer for each item or service to be appropriately billed. This is similar to using national or local coverage determinations (NCDs or LCDs) for routine clinical services.
A complete research billing coverage analysis:

  1. Outlines the participant’s financial liability, to be further explained in the informed consent document, so that all parties avoid incurring unexpected costs before agreeing to participate.
  2. Identifies the qualifying research items and procedures.
  3. Supports the billing staff in identifying the responsible payers or restrictions during the entirety of the trial to prevent False Claims Act violations.

Sample billing grid



Example Case Studies

To demonstrate how coverage analysis works, let’s review two fictional scenarios. After reading through a scenario, ask yourself:

  • Who would be listed on the coverage analysis as the responsible payer for the service or item provided to the participants during the course of the clinical trial?
  • What services or items should the coverage analysis clearly outline as standard of care or research related?
  • How could your billing staff use the coverage analysis information to avoid research billing errors during the entirety of the clinical trial?

Scenario 1: A private durable medical equipment (DME) company specializing in sleep medicine devices contacts your accredited sleep lab facility about sponsoring a clinical trial. They want to test a new version of their continuous positive airway pressure (CPAP) machine. As the sponsor, the DME company is willing to have an informed consent that states the CPAP and study-related items or services rendered during the course of the trial are covered by the DME company; however, the DME company only wants to pay a reimbursement rate of 70 percent of your facility’s charge costs. In addition, the study will only enroll a participant after screening via a recent standard of care sleep study (CPT® 95810 Polysomnography; sleep staging with 4 or more additional parameters of sleep, attended by a technologist) that led to a diagnosis of obstructive sleep apnea (ICD-9-CM 327.23 Obstructive sleep apnea (adult)(pediatric); ICD-10 G47.33 Obstructive sleep apnea (adult) (pediatric)).
Scenario 2: A cardiologist in your hospital wants to apply for a federal grant to study cardiac blood flow in teenage patients that present to the emergency department (ED) with symptoms of acute embolism/deep vein thrombosis (ICD-9-CM 453.40 Acute venous embolism and thrombosis of unspecified deep vessels of lower extremity; ICD-10 I82.409 Acute embolism and thrombosis of unspecified deep veins of unspecified lower extremity). The total grant funding offered is $50,000 for an estimated 10 patients. Your institution’s internal review board (IRB) gives approval to obtain initial study data by piggybacking off of the standard of care records acquired from the ED encounter. If, however, the patient is admitted, the study protocol requires phlebotomy every six hours, numerous lab tests, and physical exams that would not be done for medical necessity and not covered as standard of care during the inpatient stay.
Protecting your institution from criminal or civil litigation due to allegations of fraud or abuse is an important risk management goal. It is also important to consider the patient’s rights. For example:

  • In scenario 1, appropriate coverage analysis techniques would show the DME company as the responsible payer for the follow-up sleep study, according to specifics in the informed consent. As necessary for charge auditing or invoicing, your billing staff should refer to a billing plan grid (see grid above) that clearly shows the disposition of charges generated during each research encounter for the entirety of the study.
  • For scenario 2, the coverage analysis should create techniques that identify all the research specific tests, quantities, and budget caps during the inpatient stay. Again, the billing staff should use a billing plan grid with clear payer designations for research charges, broken down by six hour intervals.
  • Keep in mind that for both scenarios coverage analysis gives an indicator of the fiscal viability or potential loss your institution may incur. Just as your IRB or medical director reviews proposed study protocols for clinical efficacy, your billing team needs to do a monetary review.

Using coverage analysis techniques is a good risk management strategy for preventing common research billing errors, avoiding excessive fines due to fraud allegations, and keeping your institution on track to do the right thing.

CT Coverage Analysis Resources

  • National Coverage Determination for Routine Costs in Clinical Trials (310.1)—CMS coverage database
  • Current year CPT® and HCPCS Level II books
  • MediRegs (Check to see if your organization has a subscription.)
  • Medicare administrative contractor (MAC) sites (e.g., Highmark Medicare Services)
  • Your institution’s revenue cycle department

Duwayne Barrett, MBA, RPSGT, CPC-P, has worked as a sleep technologist and billing staff member for industry and federally sponsored clinical trials since 2002. He is the director of patient access at Mercy Suburban Hospital in Norristown, Pa. Learn more about research billing or global health care infrastructure by following Duwayne on Twitter @DbeBARRETT.

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