Understanding the current landscape

By 2030, all baby boomers will be older than 65 and eligible for Medicare. This transformative time in healthcare will make it necessary for practices to find new ways to treat the rising number of geriatric patients.

The field of telehealth offers promising ways to treat Medicare patients conveniently and effectively. However, current telehealth utilization among original Medicare beneficiaries is low. In 2016, only 0.25% of more than 35 million Medicare beneficiaries utilized telehealth services.¹ Many factors contribute to that low utilization rate, such as the statutory restrictions placed on reimbursement. However, regulatory and legislative changes in recent years indicate a desire from Congress and the Centers for Medicare & Medicaid Services (CMS) to expand the reach of telehealth services.

Original Medicare

Providers treating Medicare patients can receive reimbursement for telehealth services if they meet certain requirements. Distant site practitioners can furnish and receive payment for covered telehealth services at originating sites using live, two-way, audio-video telecommunication systems. As of this year, there are almost 100 telehealth codes available for providers to bill, ranging from psychoanalysis to diabetes management. Despite the availability of telehealth to a wide range of practitioners, the statutory requirement of where a patient must be located impedes telehealth growth.

Eligible originating sites:

Physician and practitioner offices
Hospitals and Critical Access Hospitals (CAHs)
Rural Health Clinics (RHCs)
Federally Qualified Health Centers (FQHCs)
Skilled Nursing Facilities (SNFs)
Community Mental Health Centers (CMHCs)
Renal Dialysis Facilities
Mobile Stroke Units
Homes of beneficiaries with end-stage renal disease getting home dialysis
Hospital-based or CAH-based Renal Dialysis Centers

The most limiting restriction for providers wishing to use telehealth with Medicare patients involves originating sites. Medicare beneficiaries must be located at an originating site that is either (a) outside a Metropolitan Statistical Area (MSA) or (b) a rural Health Professional Shortage Area (HPSA) in a rural census tract. However, the originating site requirement is waived if the providers are participating in a federal telemedical demonstration project that has been approved by the U.S. Department of Health & Human Services (HHS). These originating site requirements severely limit the number of patients that providers can treat through telehealth because there are HPSAs that are also located in urban areas.

These reimbursement restrictions originate from the Social Security Act, which only Congress can amend. In recent years, Congress has shown an interest in expanding telehealth services for specific health conditions and disorders. For instance, the Bipartisan Budget Act of 2018 (BBA) included language that allows new sites to be eligible and exempt from the geographic restrictions for treatment related to end-stage renal disease and acute stroke. Additionally, the SUPPORT for Patient and Communities Act requires CMS to adjust its telehealth reimbursement policy for treating individuals with substance use disorders (SUDs) or co-occurring mental health disorders.

There is also movement on the regulatory front regarding healthcare delivery via communications-based technology. In the CY 2019 Physician Fee Schedule (PFS), CMS created new virtual care codes, which allow for the use of telecommunication in treating patients without the same restrictions placed on original Medicare telehealth services. These new services are not technically considered “telehealth services” under Medicare and, as such, are reimbursed separately using new codes under the PFS.

While it is exciting that CMS is creating new codes, there are drawbacks to the logistics of utilizing these codes. For starters, the virtual check-in codes require patient consent each time because there is a patient copay. Moreover, the reimbursement rate for these codes is relatively low. For example, the reimbursement for a virtual check-in (HCPCS G2012) is approximately $15. Interprofessional internet consultations are reimbursed between $18 and $73 depending on the length of the discussion. Between the low reimbursement rate and the patient copay, virtual check-ins are not particularly attractive to physicians.

Medicare Advantage plans

Next year, medical groups have an opportunity to expand telehealth services when working with patients enrolled in Medicare Advantage (MA) plans. The BBA included language that allows MA plans to begin covering telehealth-delivered services beyond what is statutorily required in original Medicare.

In April, CMS released a final rule that further clarified the changes to MA plans set forth in the BBA. Starting in 2020, MA plans have the ability to provide “additional telehealth benefits” that are available under Medicare Part B but not payable under Section 1834(m) of the Act to enrollees and treat them as basic benefits. The originating site geographic limitations do not apply to these additional telehealth benefits. CMS also purposefully left the definition of “electronic exchange” broad, defining it as “electronic information and telecommunications technology.” Some examples of electronic exchanges include store-and-forward technologies, the telephone, videoconferencing and other technologies that are appropriate for non-face-to-face communication.

The new MA plan telehealth policies provide medical groups with the ability to incorporate telehealth more broadly into their practices; however, there are a couple points to remember. MA plans are not required to offer these additional telehealth services. The limitations on who may act as a provider under original Medicare telehealth still apply, which could discourage MA plans from choosing to participate. MA plans offering additional telehealth benefits must also comply with provider selection and credentialing requirements provided in CFR 42 §422.204. It remains to be seen how incentivized MA plans will be to cover these additional telehealth services, but it demonstrates that Congress and CMS are open to the idea of telehealth expansion.

Conclusion

In recent years, Congress and CMS seem interested in finding ways to expand telehealth without completely overhauling the legislative foundation from which telehealth originates. Congress passes bills that waive original Medicare telehealth requirements for specific cases, and CMS creates different codes that act as pseudo-telehealth services. MGMA Government Affairs expects to see this trend continue as we move forward and will monitor the progress so medical groups can make informed decisions about their practices.