Industry watchers routinely report on the progress healthcare organizations are making toward successful conversions to ICD-10 and electronic health records (EHRs). Far fewer headlines have been generated about the Department of Health and Human Services’ updated rules on financial conflicts of interest (FCOI) that went into effect in August 2012.

The new regulations, which replace the less stringent FCOI requirements initially released in 1995, demand greater transparency and accountability for healthcare organizations and research institutions that receive funds from the National Institutes of Health (NIH).

Compliance with FCOI is not a mere regulatory formality for healthcare organizations. Hundreds of thousands of dollars are at stake, as organizations that do not comply with the new rules could be disqualified from receiving NIH funding support for their research projects.

Under the new, more stringent FCOI requirements, healthcare organizations and research institutions are no longer allowed to rely solely on investigator discretion when deciding what financial interests should be disclosed to NIH. The new regulations specifically define significant financial interest as any industry compensation that exceeds $5,000 over 12 months (a decrease from the former $10,000 limit), any equity participation in a non-public company, and certain intellectual property rights. In addition, NIH-funded organizations now are obligated to respond to written public requests for FCOI information within five days.

Another significant change in the new FCOI rules is that all investigators must complete training prior to engaging in any NIH-funded research projects—and re-train at least every four years. Staff training also must be conducted immediately whenever an institution’s FCOI policies change, an investigator is newly hired, or an investigator is found to be non-compliant with the organization’s FCOI policy and/or management plan.

Furthermore, healthcare organizations must have a process for determining which significant financial interests constitute FCOIs for its investigators, as well as have a management plan for mitigating that conflict. Possible components of the required management plan include:

• Disclosure of FCOI to participants
• Appointment of an independent monitor to protect the design, conduct, and reporting of the research against bias resulting from the FCOI
• Modification of the research plan if FCOI is determined
• Change of investigator responsibilities or disqualification from participation in all or a portion of the research
• Reduction or elimination of the financial interest (such as sale of an equity interest)
• Severance of relationships that create FCOIs

By creating policies that deal with each of these components, healthcare organizations can be better prepared to quickly implement corrective action plans that address financial conflicts as they are identified.

Best Practices for Deploying a FCOI-Compliant System

With the FCOI regulations now in full force, healthcare organizations should already have evaluated their FCOI policies and related technology infrastructure to determine their compliance readiness. Ideally, organizations should have a methodology in place for obtaining financial disclosures using an electronic questionnaire that ties directly into a centralized database. For those organizations still relying on a paper-based disclosure system, the new FCOI regulations present an opportunity to streamline processes by deploying an automated solution that will simplify FCOI tracking and reporting to NIH. Whether an organization needs to update an existing automated FCOI system or create a new one, there are best practices recognized within the industry that can make either endeavor both time- and cost-efficient.

At the outset, advocacy by senior leadership is critical to ensuring the financial resources needed to update or acquire an automated FCOI system are earmarked. To facilitate a successful FCOI technology implementation experience, IT department heads would do well to use a three-prong approach based on evaluating current processes, identifying future needs, and implementing a forward-looking solution with a demonstrable return on investment (ROI).

FCOI systems capable of processing financial disclosure forms annually, as well as on a transactional basis, enable researchers to update disclosures and conflict status information for multiple projects as they arise. In combination with a robust and accessible database, this functionality can be instrumental in helping maintain the most current financial disclosure information for investigators and other key staff. Such an automated system will also allow institutions to comply with NIH and public requests for FCOI information within the mandated five-day window.

There are several options available to healthcare organizations seeking to upgrade or deploy an automated FCOI solution. When vetting potential product offerings, the organization’s IT decision-makers should expect a best-in-class FCOI solution to offer, at a minimum, the following feature set:

• Multi-level branching questionnaire design capabilities
• Automated assignment of reviewers
• COI management plan development
• Data mining tools for auditing, tracking, and reporting on potential conflicts of interest

Healthcare IT departments today are challenged to leverage technology to achieve compliance for a host of regulatory guidelines without depleting already-scarce resources. An automated FCOI solution can help meet both goals, by ensuring easier compliance with the new FCOI regulations without greater investments in time or human capital.

William Sacks is co-founder and vice president of Health Care Compliance Strategies, which provides compliance and conflict of interest services. Sacks has more than 30 years of experience in healthcare management as a consultant, medical practice manager, and faculty practice plan director.