Budgets – Cost Reimbursable

Cost Reimbursable Budget Transcript

There are two main types of budgets used in research: fixed fee and cost reimbursable; today we’ll look at building a cost reimbursable budget.  This requires a detailed breakdown of associated expenses when planning how you will be compensated for your work.

Fiscal responsibility is a necessity for all researchers and starts with a project’s budget.  A close look at all costs involved ensures that the project is being done in a cost effective manner; just as people strive to get the most out of their personal budgets, MMRF strives to achieve the most progress for the most reasonable price.  Being able to fully cover the costs of a study, while being compensated fairly for quality work, is always the goal.  MMRF follows the cost principals outlined in 2CFR 200 as well as those in our institutional business expense guidelines, both linked in the description.

To start a budget, imagine every step involved from project start to finish.  Where will the work take place?  Will other institutions be involved?  Will this project involve travel?  Will new equipment need to be purchased? And what about staff; will new personnel need to be hired?  What kind of time will be needed to reach the study’s aims?  What about supplies, materials, or other consumables?  And how about compensation for patients or costs for pre-clinical subject models?

Now that you’ve imagined the steps and costs involved to accomplish your research, let’s get organized.

This sample template for a cost-reimbursable budget arranges costs into these categories: key personnel and other staff, equipment, travel, trainee costs, other direct costs, and finally indirect costs.

The first two sections deal with personnel costs.  Who will work on the project?  Be sure to list all MMRF and HCMC staff from the pharmacist filling and tracking prescriptions to the data analyst.  Consider how long it will take for a task to be completed.  If it takes three hours to consent a subject and run tests, and another three to analyze the data then make sure to budget for the full six hours per patient instead of only the three directly interacting with them.  Other labor costs to consider would be any necessary staff training or time the PI may need for article writing.  Remember this is just MMRF/HCMC personnel; subawards, collaborators, and consultants come later.

If you do plan to set up a subaward contact your Grant Administrator right away.  Each subaward site will need to create its own budget and interinstitutional agreements will need to be set up, so the earlier your GA can get started the better.

Next is equipment. For federal proposals, anything over $5,000 is considered equipment and gets its own line item.  A laptop for data entry or a pharmacy storage fee would be considered a supply and not listed here.  Special equipment over $5,000, such as a freezer or centrifuge, should be itemized here.

Travel costs include airfare, lodging, ground transportation, meals, and incidentals.  Will you need to travel to any sites to meet with co-investigators or present data?  Will there need to be a study startup meeting or any required visits to subcontractors?

Costs related to Trainees and Participants are fairly rare at MMRF—these would be more typical of an institution of higher education; check with your Grant Administrator if you have questions about this section.

Other Direct Costs include costs from many other categories, such as rent, printing and publication costs, study materials and supplies, participant payments, postage, and other direct costs your project will incur.  Think about the space your project will need.  Where will each step take place?  Do you already have that space available and will you need to pay rent on those areas?  Will subject recruitment materials (such as brochures or advertisements) or patient stipends be needed? Do you plan to publish and how much will those fees cost?

Additional common costs to consider would be services provided by HCMC such as data analysis, pharmacy or laboratory services, and other HCMC billable services.  These will need to be paid for by the research project and must be included in the budget.  Billable service costs will also need to be outlined in your IRB application in Appendix A.  Note that HCMC charges Medicare rates for research related procedures, so use this as guidance to budget these expenses. At HCMC, data extraction from EPIC is done by the Analytic Center for Excellence.  Please contact them early in the process to make sure they have the resources that you need available.

Other direct cost considerations include space costs for non-common areas like a dedicated office, binders for study materials or other office supplies, and any fees specific to the project.  Will you need to hire any consultants, like someone specialized in FDA submissions? The budgets provided by your subawards also fall under Other Direct Costs. Remember to engage your grant administrator early on to make sure the subawards are setup and ready to go in time for submission.

Once you have identified all of the direct costs related to your project, the final item is MMRF’s facilities and administration rate.  These are the costs to maintain the institution’s infrastructure and compliance requirements.

For federal projects, MMRF calculates indirect costs on a SALARIES and WAGES basis; so all of MMRF’s indirect costs for a project are calculated ONLY on the S&W amount.  This is different from other institutions which typically calculate overhead on all direct costs in the project.  Of course, if a sponsor has published guidelines in the proposal announcement that limit F&A MMRF will meet those requirements.  A request from a sponsor is not enough for a reduced rate without approval from MMRF’s authorized institutional official; the rate must be stated in the request for a proposal or in the terms of the award available on the sponsor’s website.  Also, different rates can apply when working with an industry partner or foundation.

As you work through building your budget, be sure to keep in contact with your grant administrator so they can work with you to ensure your project’s budget is set up for success.

Now that you have the numbers and costs laid out for your project, it’s time to write a budget justification.  This is just a written description of the line items requested that explains why these funds are needed to conduct this research.  MMRF and the NIH have a few templates available that can help in starting the budget justification; get in touch with your GA to learn more.

After your project is funded, make sure to check the monthly Financial Accounting Statements sent from MMRF accounting so you can compare the actual costs to what was budgeted.  Occasionally budget adjustments may be needed.  Don’t worry; your GA is there for that as well.

If you have questions about budgets or anything else feel free to email us at researchinquiry@hhrinstitute.org.  Thanks for watching and have a nice day.

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