Mitigating undue influence in clinical care, teaching, and research is essential for healthcare organizations, especially academic medical centers (AMCs). While clinical providers often engage with external industry entities in the consulting space to advance scientific and educational discourse and innovation, such engagements can create compliance challenges. Consulting engagements may cause a clinical provider to deviate from their contractual responsibilities to their employer, exposing both the clinician and organization to potential reputational, financial, and regulatory risks.
This article explores how AMCs can identify, manage, and mitigate potential conflicts of interest (COI) by establishing a preapproval contract-review workflow to protect the interests of the clinical provider and the healthcare organization.
How does a COI present in a consulting capacity?
As a baseline, a clinical provider should refrain from any engagement with an external industry entity that interferes or significantly conflicts with their contractual responsibilities to their employer. A COI can arise when a clinical provider’s personal, professional, or financial interests may compromise, or appear to compromise, their objectivity. In the private consulting space, a clinical provider’s compensated consulting interests in an external industry entity that also conducts business with their employer could be construed as providing undue influence on the care provided to patients, purchases made in the clinical space, or research efforts pursued. Even an unpaid external consulting role could present a COI if it impacts a clinical provider’s objectivity.
When does a COI become a potential regulatory concern?
A COI in consulting can become more problematic from a regulatory perspective when it implicates federal laws such as the Anti-Kickback Statute or the Physician Self-Referral Laws (Stark Law). Without proper safeguards, compensation exchanged between a clinical provider and an external industry entity could be considered an inducement to refer or arrange for the referral of business that is payable by the federal government. Violations could lead to heavy criminal and civil penalties for all parties involved, including, but not limited to, damages under the False Claims Act. To mitigate regulatory risks, adherence to healthcare organization policy requirements and regulatory protections can be critical.
Given these considerable risks, getting ahead of any potential COI issues that may emerge in a clinical, academic, or research setting is imperative for an organization. AMCs can reduce risk and improve disclosure compliance by focusing on: (1) identifying and managing COIs in consulting; (2) establishing a preapproval contract workflow; and (3) educating providers on their disclosure obligations.
Identification and management of COIs in consulting
To determine whether COIs exist among its clinical providers, a healthcare organization should implement a mechanism for clinical providers to self-report relevant interests involving external industry entities. A structured disclosure system promotes transparency and provides visibility to stakeholder departments, allowing them to review and collaborate on mitigation efforts once a COI is confirmed. Such a system can also support ad hoc auditing and monitoring by a dedicated team. Aside from the disclosure of ongoing interests, the healthcare organization should be informed of newly proposed opportunities presented to its clinical providers for consideration. To avoid any gaps, embedding a preapproval process for proposed consulting engagements can help proactively address regulatory and healthcare organization policy concerns from the outset.
A central concept to keep in mind when reviewing proposed arrangements for potential COIs is the criteria that would trigger additional review. The healthcare organization should define the types of interests and activities that would be considered consulting. For some, consulting can be as straightforward as offering advice to an outside party, regardless of whether remuneration is exchanged. For others, consulting could involve serving on an advisory board. Sometimes consulting involves tangible deliverables or simply the exchange of ideas. It is crucial that consulting be defined by the healthcare organization in its policies and procedures to remove ambiguity from the review process. From a regulatory perspective, the consulting service, compensation, and time commitment represent well-established criteria that could implicate a clinical provider and their employer. Ideally, services should be confined to scientific and/or educational efforts in support of the healthcare organization’s mission. In summary, consulting services should not compromise the reputation of the healthcare organization that employs the clinical provider, and there should be a clear definition of outlining the criteria warranting further review.
When identifying potential COIs in consulting, the type of external industry entity with which clinical providers associate matters. A preapproval contract review process would enable the healthcare organization to be aware of the types of opportunities presented to its clinical provider population. At times, external industry entities may reach out to hundreds of clinical providers in a specialty, which may also include multiple clinical providers in the same department of an institution. Consistency in recommendations is a vital part of the review process. Inconsistency can prove perilous for a healthcare organization in terms of building trust in a transparent review process that minimizes bias.
Furthermore, a healthcare organization must determine the threshold of reviews that can be submitted for preapproval on an annual basis or during a given period. For example, should all one-time speaking engagements be required to be submitted for approval, or only those arrangements with ongoing services? The answer may depend on the scope of the healthcare organization’s mission.
A structured disclosure system promotes transparency and provides visibility to stakeholder departments, allowing them to review and collaborate on mitigation efforts once a COI is confirmed.
Once identified, a potential COI should be reviewed by relevant stakeholders to ensure that appropriate mitigation efforts are implemented. Committees may be formed to focus on specific institutional areas, such as the impact of external consulting on purchasing or research. It is also essential to determine how the identified COI could be managed and by which appropriate parties would manage it. With this collaborative approach, consulting arrangements are vetted by relevant stakeholders as needed before execution to ensure adherence to the healthcare organization’s policies and applicable healthcare regulations, while safeguarding institutional assets and mitigating risk for all involved parties.
The establishment of a preapproval contract review workflow
Some organizations lack formal COI policies and instead handle COI matters on a case-by-case basis. This approach may be impractical for healthcare organizations with a larger clinical provider population. Healthcare organizations often benefit from established policies that reduce administrative burden and target interests requiring further review, especially in consulting. When developing a workflow, healthcare organizations should consider the population and the means of submission for such preapproval requests. Some healthcare organizations consolidate proposed consulting requests through the clinical provider’s department and then onward to a central committee for final review and approval. In other cases, a healthcare organization may implement a workflow in which the clinical provider submits proposals directly to their supervisor for approval without receiving input from different stakeholders. Ideally, a successful workflow should include input from compliance in reviewing at least a portion of these submissions, if not all of them.
Existing rules and regulations must drive policy development. While healthcare organizations may employ COI policies tailored to their unique provider community, the consulting review process should be clearly defined and widely disseminated amongst the applicable population. As best practice, consulting agreements should be submitted within a specified time frame so that any recommendations can be incorporated before the activity begins. Submitting a proposed agreement the day before an event will be held does not provide sufficient time for a reviewer or supervisor to weigh in appropriately.
Regarding the submission of documentation, the workflow should clearly outline the minimum necessary information so that a comprehensive review can be completed. As best practice, a consulting agreement should clearly define the scope of work, compensation to be received, and the basis for payment. Parameters should consider whether the use of a healthcare organization’s resources is permitted for the consulting to be performed by a clinical provider. Such allowance could create liability for the healthcare organization and lead to reputational issues. A healthcare organization should consider whether it is appropriate for a clinical provider to use their organization-issued computer, office space, or other resources when providing consulting services. For many healthcare organizations, it would be wise to avoid such crossover and prevent any potential conflicts of commitment concerns that may arise.
Ideally, the consulting services should not overlap with the services that the clinical provider is engaged in to provide for their employer. If any overlap is discovered during the review process, the reviewer can consult with the appropriate stakeholder departments for further review. As a protective measure, the workflow should acknowledge that the healthcare organization’s policies will govern regardless of the terms outlined in an individual consulting agreement.
It is also essential to include the clinical provider’s supervisor in the review process, as they would have context on the clinical provider’s performance. For instance, it would only be appropriate for the clinical provider to consider engaging an external industry entity if they have met their full-time obligations to the healthcare organization.
The turnaround time for the review process should be established and documented in the healthcare organization’s applicable policies and procedures. The clinical provider should drive the process, and the healthcare organization should determine whether the clinician should lead any correspondence with the external industry entity. While there are pros and cons to direct communication between the clinical provider and the external industry entity, it is imperative to ensure the clinical provider understands what they are agreeing to perform under the arrangement. Regardless, whoever is guiding the process should review it proactively and ensure any feedback is memorialized in writing. It is important to note that some external industry entities may experience delays in their responses as they process hundreds of arrangements; therefore, patience is required by all parties.
The way in which reviews are conducted also matters. For larger healthcare organizations, investing in an online platform to centralize the repository of both ongoing disclosures and newly proposed requests under an individual account profile.
As part of the workflow, the clinical provider should be allowed to make edits to a contract as agreed upon with the external industry entity, provided that these edits fall within the healthcare organization’s policy parameters. However, dealing with disappointment is part of the process. As such, the healthcare organization should have a politically sensitive plan to address arrangements that cannot be further modified to fall within its policy parameters. Outside of the primary review process, obligating the provider to inform the healthcare organization of any changes to the scope of the relationship is crucial for monitoring efforts, prompting re-review so that the healthcare organization can opine further on the relationship terms over time.
Addressing nondisclosure is a critical aspect of the review process as well. If it is discovered that the request is submitted after participating in the activity without the input of a supervisor or compliance, then the purpose of getting ahead of any risk points would be rendered obsolete. Consequences, if any, should be applied consistently and uniformly.
As the review process concludes, the final approval authority is a significant factor in the workflow’s success. At some healthcare organizations, the supervisor will provide final approval. At others, the responsibility to determine whether a consulting arrangement is appropriate for engagement rests with the individual clinical provider. Here, some oversight and consistency in how approvals are issued can support the mission of ensuring that clinical providers are treated consistently across the organization, regardless of the department with which they are associated.
As a protective measure, the workflow should acknowledge that the healthcare organization’s policies will govern regardless of the terms outlined in an individual consulting agreement.
Lastly, notification is a significant element of the workflow. Ensuring that the individual provider and their supervisor are informed of the final determination is vital for transparency in the process. This also encourages others to use the system rather than opting out of the process altogether. The following are some additional elements to consider when developing a preapproval contract review workflow:
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- What types of proposed interactions with outside industry entities (i.e., excessive compensation, marketing/ promotion of outside industry products, remuneration based on volume of referrals, etc.) would trigger further review?
- Must all arrangements fall within a safe harbor protection to proceed to the final step of the preapproval review process?
- If an ongoing interaction or arrangement was not submitted through the preapproval process and is found to require services to be offered or provided in a manner or on conditions that would interfere with independence in clinical practices, how would this be addressed in real time by the healthcare organization?
- If an employee has a compensated consulting interest in an external industry entity, are they required to recuse themselves from voting in purchasing or formulary decisions made by their employer?
- Upon discovery, how should significant COI issues involving multiple clinical providers be handled?
- Does the workflow address consistency in escalation and discipline to guide stakeholder recommendations?
Ways to encourage and educate providers on disclosure obligations
COIs in consulting can be highly politically and culturally sensitive. Ensuring that clinical providers understand the healthcare organization’s relevant policies supports broader adoption of preapproval and disclosure systems. The presence or absence of leadership buy-in can determine the success of a preapproval contract review workflow. While annual compliance training is helpful, department-wide refresher sessions and year-round newsletter communications keep such efforts active and visible.
Managing COIs in the consulting space isn’t the responsibility of one person; it requires collaboration among leadership, stakeholders, and clinical providers to proactively seek approval for consulting engagements and periodically review existing interests. Ongoing education helps reinforce how COIs in consulting are identified, reviewed, and escalated. In the best-case scenarios, healthcare organizations can mitigate such risks by establishing a preapproval contract review process to ensure efforts to interact with outside industry are within compliant boundaries. With policies, education, and regular auditing and monitoring efforts in place, healthcare organizations are better positioned to prevent COIs in the consulting space before they pose a significant risk to clinical providers or the healthcare organization itself.
Takeaways
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- A healthcare organization should clearly define in its policies and procedures the interests and activities that would be considered consulting.
- Consulting agreements should be submitted within a given time frame so that any recommendations can be incorporated before an activity is initiated.
- Identified conflicts of interest can be managed through collaboration with relevant stakeholders.
- Consistent recommendations are critical. Inconsistency can undermine trust in the development of a transparent review process.
- Buy-in from a healthcare organization’s leadership can determine the success of the preapproval contract review workflow.