Clinical Trial Billing Errors Generate Multi-Million Dollar Fines

Clinical trial billing errors continue to emerge at established, well-respected sites—and the penalties and publicity can hit hard, warns Brent Ibata, PhD, JD, MPH, FACHE, RAC, CCRC, CPI, CHRC, the research compliance officer at Sentara Healthcare.

It is rarely a case of out-and-out fraud, Ibata notes. Instead, it can be a lack of understanding. Clinical trial research studies must meet federal billing compliance requirements, including:

  • no double billing at the site level;
  • medical documentation must support coding;
  • research modifiers, diagnosis codes, condition codes, and NCT# (the National Clinical Trial Number, or Identifier) must be in place when the study is qualifying; and
  • transparent documentation from the sponsor must be clear and definitive.

“Isolated instances of fraud and abuse artificially inflate the cost of healthcare to the federal government,” Ibata says. Some estimates say improper payments costs Medicare and Medicaid more than $50 billion annually. In some cases, sponsors are not getting everything they paid for, either. Billing compliance is a partnership between sites and sponsors to get it done correctly.

“Sites need to understand the coverage analysis process and how it protects them in clinical trial billing,” states Kelly Willenberg, MBA, BSN, CHRC, CCRP, CHC, of Kelly Willenberg & Associates. “Once you understand the rules, you can put best practice in place and show due diligence.”

Federal regulators are working to get some of the losses back. Several settlements demonstrate the seriousness of the situation. Those include:

  • Rust University Medical Center agreed to a $1 million settlement after self-disclosure of improperly billing Medicare for physician and hospital services and as routine costs in cancer care.
  • Tenet USC Norris Cancer Hospital settled for $1.9 million after self-disclosure of overbilling with oncology trials.
  • The University of Alabama at Birmingham accepted a $3.39 million settlement for falsely billing Medicare for researcher time spent on patient care when no patients had been seen.
  • Emory University agreed to a $1.5 million settlement for falsely billing Medicare and Medicaid for clinical trial services that were not permitted by the Medicare and Medicaid rules in a whistleblower case.