Infographic

What is Coverage Analysis in Clinical Research?

April 30, 2021

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.

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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 participant.

How does non-compliance happen?

It is largely due to a lack of understanding¹. 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 2019²
$2.8 billion in 2018³
$3.7 billion in 2017⁴
More than $62 billion since 1986²

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 sites faced, a site’s reputation can face severe backlash following the settlements¹.

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 violation⁵.

In 2016, US hospitals submitted $3 trillion worth of medical claims; $262 billion of the charges were initially denied⁶.

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.