Contributed By John McIlwain
Many healthcare delivery organizations also conduct clinical research. In fact, this research has become a significant source of revenue for these institutions, which can include academic health centers, practice plans, hospitals, affiliated clinics and multi-center clinical research networks.
Healthcare providers conducting clinical research face a very real challenge with both underbilling and overbilling. The former leaves them operating at a loss, while the latter jeopardizes their compliance with the law. The requirements of clinical research billing, and the established billing processes and systems now available in the hospital or clinic, are antithetical. What’s more, the lack of organizational infrastructure to manage this dichotomy in billing is both costly and risky.
The problem outlined by Amar P.S. Chahal, MD, in a white paper for Velos Inc., has two dimensions. One relates to the domain of patient care, while the other relates to the activities of clinical research. For the established billing department in patient billing, the objective is to ensure that an encounter or procedure funded by the research sponsor is appropriately billed to insurance; appropriately billed to the patient; and not double-billed or not charged to Medicare when a sponsor has paid for it.
For the clinical research billing department, the objective is to ensure that billing for the clinical research is appropriate to the contract specifics through the use of either the chargemaster or a contract-specific set of charges); appropriate to the organization providing the service (a research protocol may have encounters that occur in the hospital, the physician practice or an affiliate); and based on the right milestones defined in the sponsored research contract.
The current norm, with attempts to define the problem purely in processes around either hospital billing systems or research billing systems, has proven unsuccessful, expensive in terms of losses and risky in terms of consequences.
Risks from lack of infrastructure include significant monetary risk, estimated to be from $4 million to $14 million in large academic organizations. Non-monetary risks from the lack of good billing system infrastructure for clinical research include double billing and consequent exposure to charges of insurance and often Medicare fraud; security exposure under HIPAA and IRB regulations; and obvious ethical issues.
Within the patient care domain, billing is driven by encounter, DRG, location and the patient. Billing for clinical research may be event-, encounter- or milestone-driven. Research protocols can take the patient across care organizations, service groups and multiple labs. This creates a complex web of billing, discounting and decreased fees.
Beyond these complexities, the process is further confounded by differing systems based on location of services or multiple billing organizations, such as a practice plan or hospital, within the same research organization. It is also complicated by the need to bill parts of the same encounter to various entities – insurance, patient or sponsor – based on a specific contract or the need for pass-through billing on ancillary services that may be outsourced.
Another factor is the need for patient confidentiality, which may not be supported by the billing system. Additionally, there are supply chain management issues from a billing perspective; for example, patients may be encountered at the research sites but be billed from the lead research center.
As a result, billing systems are needed to support this complexity. Almost all organizations have satisfactory patient billing systems in place. Increasingly, academic centers are looking to systems that track charges and billing for research. However these systems, in their current deployment, are open to the problems of under-billing due to missed encounters or data, as well as double-billing and incorrect billing.
This problem requires a software solution that will connect these multiple sets of billing systems within the two domains and enable expert review of data across platforms. This solution must provide a simple interface for the expert to quickly approve or negate charges. It must store and forward different charge and bill types back to each billing system and, later on, offer the capability to add automation and intelligence. It also must enable an organization to create an audit trail for these actions.
This software solution should ideally live as middleware, residing between billing and research systems. It can be designed to run with a simple interface, displaying appropriate information for a research expert to view a comparison of patient charges with the appropriate research protocol contract billables. This solution can help the manager decide on appropriateness of visits and procedures for transmission back to each distinct system for billing to insurance, patient, or sponsor, and it must discard unnecessary line items. This software solution should record all entities that need billing for different visits on a protocol and agree or disagree with the billed amounts. Finally, it should pronounce the data fit for sending back to the patient and research billing systems.
As middleware, this system set can remain independent of billing and research financial management systems and still provide protection from changes in a highly regulated and scrutinized environment. Ideally, it can provide auditability at compliance levels for both billing and research, and serve as a knowledge store for processes. Staying independent of the information itself – the only transactions in the system being the set of decisions or notes regarding decisions about billing – this system set should enable increasing amounts of automation over time, as well as extensibility in other billing areas beyond research.
By deploying an application as a billing rules engine with specific user-determined or embedded rules, there can be a safe knowledge-processing store for this vexing problem, one that is unresolved today for most healthcare providers conducting clinical research.
John S. McIlwain is CEO of Velos Inc. of Fremont, Calif.