Standard of Care and Payment Overlap in Clinical Trial Research

The financial aspect of standard of care in patient treatment has become a major issue for many companies conducting clinical research. Many industry monitors, self-appointed and otherwise, have highlighted the issue of payments to physicians by pharmaceutical companies, including the fair market payment of clinical grants, as possibly influencing physician behavior. Subjects in later phase clinical research must have the malady being treated in the clinical trial. Consequently, many of the treatments these patients receive would and should be covered by third-party payers, typically government agencies or commercial insurance companies.

Double Dip: Third-Party and Pharma

In addition to questions of fair market value, senior clinical development management is simply looking for better ways to deal with rapidly increasing drug development costs. One way is to avoid double payments for medical procedures that are covered by third-party payers. A review of over 100 current protocols¹ demonstrates that, while companies are introducing standard of care considerations into their clinical grants, a substantial amount of potential payment overlap still exists. An additional 22% of clinical grants, beyond what pharmaceutical companies already consider as standard of care, is usually covered by these third-party payers. Standard of care is no longer a subjective measure, but rather what physicians are paid to treat a patient for a specific indication according to actual payment records.² Moreover, a large percentage, 80%, of this payment overlap takes place for less expensive procedures, that is, procedures costing less than $1000,—TTC (for more information, please contact help@ttc-llc.com).

1. Subscribers to GrantPlan conduct over 76% of all clinical trials http://ClinicalTrials.gov; March 1, 2010.

2. Trialytics payments data covering over 800 million payment records from commercial insurance companies, Medicare and Medicaid.