Penn State College of Medicine’s Clinical Trials Office provides payer coverage analysis, which is a review of research-related documents to determine the Medicare billing status of both the study and the items/services provided to research subjects as part of a research study.
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Learn More about Payer Coverage Analysis
A coverage analysis (CA) is a systematic review of research-related documents to determine the Medicare billing status of both the study and the items/services provided to research subjects as part of a research study.
The CA process involves the following steps:
- Identify studies to undergo CA.
- Create the coverage analysis review (CAR) memo.
- Perform the “qualifying status” of the clinical trial.
- Identify routine costs.
- Construct the study billing grid as a tool for coverage determinations.
Primary objective: To ensure all costs of a clinical trial are billed to the appropriate payer (sponsor, a third-party payer, institution or subject).
The coverage analysis (CA) is necessary to assist in determining the responsibility of charges in a clinical trial. Medicare will only reimburse clinical trial services and items when a clinical trial “qualifies” for coverage and the items and services are “routine costs.” The CA identifies those items and services that may or may not be billed.
A coverage analysis is required for studies that include services billable to insurance. The CA is needed if it is possible for a charge to be captured in the billing system. The CA is not needed if a trial uses existing specimens or involves collecting data based on clinical progression. A survey, retrospective or observational study only includes a collection of forms during the standard of care. Form collection is not billable to insurance.
Medicare rules are used for various reasons.
It is not practical to budget on non-Medicare rules since Medicare drives the reimbursement rules in the United States. Medicare incorporates the “most favored nation” clause. This means that if a Medicare patient is enrolled in a clinical research study, the best deal must be given to the Medicare subject.
Medicare rules for research coverage are being adopted by payers, with many states already requiring commercial payers to follow rules similar to Medicare.
Pediatric studies go through the process as well since budget negotiations are based off of the coverage analysis results.
Determining coverage involves a three-part approach.
First, the coverage analysis reviewer will identify if a clinical trial “qualifies” for Medicare coverage based on the Clinical Trial Policy established through the national coverage determination process.
If the trial does qualify, the reviewer will pinpoint what items and services are “routine costs” in the clinical trial and potentially billable.
Finally, a review of all statutes, regulations, national and local coverage determinations, Medicare manuals and specialty-specific practice guidelines will take place in an effort to determine if Medicare rules allow for coverage of these specific “routine costs” in the clinical trial.
When a study qualifies for Medicare coverage, routine costs can potentially be billed to Medicare. Medicare is likely to cover the following:
- items and services that would be covered outside the clinical trial when provided for the same purposes; and
- items and services identified as “routine costs” when not being paid for by the sponsor (or through a grant) or promised free in the informed consent.
A two-part process is used to determine if a study is a qualifying clinical trial. The study must be one of four types of trials that Centers for Medicare & Medicaid Services (CMS) has deemed to meet certain characteristics. Additionally, the study must meet three necessary requirements.
Types of Trials Deemed to Meet Desirable Characteristics
A trial must be one of these four types in order to potentially be considered a CMS qualifying clinical trial:
- Funded by NIH, CDC, AHRQ, CMS, DOD or VA; or
- Supported by centers or cooperative groups funding by NIH, CDC, AHRQ, CMS, DOD or VA; or
- Conducted under an IND application; or
- IND-exempt under 21 CFR 312.12(b)(1)
A trial that falls into one of those types will be considered a CMS qualifying clinical trial if all of the following requirements are met.
A trial must meet all of these three requirements, in addition to being one of the study types listed above, in order to be considered a CMS qualifying clinical trial.
- Falls within a Medicare benefit category
- Has therapeutic intent
- Has enrollees with diagnosed disease
If the research study does not qualify for coverage, none of the protocol required items and services can be billed to Medicare.
There are two exceptions: conventional care and the treatment of complications.
Routine costs in a qualifying clinical trial are billable to Medicare.
Routine costs under the Clinical Trial Policy include all items and services that are otherwise generally available to Medicare beneficiaries. This means a benefit category exists for the item or service, it is not statutorily excluded, and there is not a national non-coverage decision.
Routine costs in clinical trials include:
- items or services that are typically provided absent a clinical trial (e.g., conventional care);
- items or services required solely for the provision of the investigational item or service (e.g., administration of a non-covered chemotherapeutic agent);
- items or services required for the clinically appropriate monitoring of the effects of the item or service, or the prevention of complications; and
- items or services needed for reasonable and necessary care arising from the provision of an investigational item or service, in particular for the diagnosis or treatment of complications.
Routine costs in clinical trials do not include:
- the investigational item or service itself (unless otherwise covered outside of the clinical trial);
- items and services solely to satisfy data collection and analysis needs;
- items and services not used in the direct clinical management of the patient (e.g., used to determine trial eligibility);
- items and services provided by the research sponsors free of charge;
- items and services promised free in the informed consent; and
- items and services not generally available (those items and services without a Medicare benefit category, that are statutorily excluded or that fall under a national non-coverage policy).
The Clinical Trial Policy states a clinical trial must have therapeutic intent in order to be a qualifying clinical trial.
This means the trial must not be designed exclusively to test toxicity or disease pathophysiology. The principal purpose of the trial must be to test whether the intervention potentially improves the participants’ health outcomes.
No. A Medicare/Medicaid beneficiary is responsible to pay a copay, coinsurance and/or deductible. These cannot be paid by a trial sponsor.
The Medicare Administrative Contractor (MAC) for Penn State Health is currently Novitas Solutions Inc. The local MAC plays an important role in billing in both drug and some device trials.
The Centers for Medicare & Medicaid Services (CMS) has established regulations for coverage of device trials.
These rules are found in the Code of Federal Regulations 42CFR 405.201 – 405.215 and 411.215 and 411.406. In addition, the Medicare Benefit Policy Manual stipulates that it is the responsibility of the investigator to provide information to the MAC in order for a coverage determination to be made.
Investigators can expect an average of 30 to 45 days until an answer is received from the local MAC.
The local MAC, currently Novitas Solutions Inc., is contacted for all subjects enrolling into clinical trials at Penn State Health. The coverage analysis can only be built upon mational and local coverage determinations. The potential enrollment of an out-of-state subject is unknown at the beginning budgeting phase, when the coverage analysis takes place.