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Medicare Telehealth Expansion Amid Coronavirus May Have Long-Term Access Implications

by Manuel Avina, Nick Diamond, Danielle Showalter, Abby Moorman, Richard Hughes IV, Chad Brooker, Avalere, on March 20, 2020
New flexibilities for telehealth services in fee-for-service (FFS) Medicare are designed to support ongoing COVID-19 response efforts.


New flexibilities for telehealth services in fee-for-service (FFS) Medicare are designed to support ongoing COVID-19 response efforts.

Ongoing COVID-19 response efforts have increasingly focused on the role that telehealth services can play in augmenting access to care. The CDC has recommended community-based interventions such as social distancing to help slow the spread of COVID-19. This elevates telehealth as a component of the COVID-19 response. The $8.3 billion emergency response funding bill passed by Congress includes provisions that would temporarily increase access to telehealth services for FFS Medicare beneficiaries. In the future, this could be a catalyst for revisiting telehealth requirements in Medicare.

Telehealth Regulation Varies Across Markets

Currently, the federal government, states, and private payers are working to overcome telehealth coverage and reimbursement barriers, but there continues to be variation across states and modalities that affect broader adoption. At the state level, over 40 states and DC have passed widely varying legislation since 2017 to expand telehealth coverage for Medicaid programs and in both the individual and insured group markets. Recent legislation has focused on expanding the scope of telehealth services, ensuring reimbursement parity, establishing telehealth professional board standards, and promoting cross-state licensure.

In April 2019, the Centers for Medicare & Medicaid Services finalized a rule that allows beneficiaries to access additional telehealth benefits in Medicare Advantage (MA), increasing the percentage of MA plans that offer telehealth benefits from 6% in 2019 to 59% in 2020. Moving forward, changes to FFS Medicare could influence how coverage and reimbursement is regulated in different markets for telehealth services.

Reimbursement and Coverage for Telehealth Services in FFS Medicare is Limited

Currently in FFS Medicare, telehealth services may only be reimbursed if they are used in designated geographic areas, at a specific type of site, administered by certain providers, and facilitated by a specific telehealth modality. Specifically, Medicare beneficiaries must be at an approved originating site (e.g., doctor’s office, hospital, critical access hospital, rural health clinic) located in a rural health professional shortage area or in a county outside a metropolitan statistical area, and the telehealth service must be facilitated using two-way, audio-video communication. Typically, treatment via telehealth is provided through the use of an originating site’s telecommunications equipment, as opposed to beneficiary-owed technology, which limits a beneficiary’s ability to use telehealth services at home. There are certain originating site exceptions for beneficiaries with co-occurring mental health disorders, substance abuse, and home dialysis end-stage renal disease-related medical evaluations.

H.R.6074 Expands Originating Site Requirements and Telephone Use Under COVID-19 State of Emergency

On March 6, President Trump signed H.R.6074, the Coronavirus Preparedness and Response Supplemental Appropriations Act, into law, which allows the Department of Health and Human Services (HHS) to waive certain reimbursement requirements for telehealth services provided under Medicare Part B including:

  • Relaxing the “originating site” requirement: The bill will allow for telehealth services provided in nonrural areas, a beneficiary home, or other nontraditional sites.
  • Allowing the use of telephone for telehealth services: The bill reimburses FFS Medicare providers for telehealth services delivered via telephone, but only if audio and video capabilities are available for two-way, real-time interactive communication. This may include beneficiary-owned technologies, such as a smartphone with video capabilities.

However, these new flexibilities only apply if the following are met:

  • Requires an active public health emergency declaration for COVID-19, originally declared by the Secretary of HHS on January 31, 2020.
  • Limits “qualified providers” to those who have treated the beneficiary within the last 3 years or if another member of the same practice treated the beneficiary in the last 3 years. This limitation does not apply to current telehealth services under Medicare and likely only applies in the context of the current public health emergency declaration.

Separately, HHS provided a Notice on March 17 that covered healthcare providers that use telehealth services during the COVID-19 national public health emergency would not be subject to penalties by the Office for Civil Rights for noncompliance under the Health Insurance Portability and Accountability Act of 1996. Therefore, providers may use non-public facing applications (e.g., Apple FaceTime) or privacy-protected applications (e.g., Skype for Business) to provide telehealth services. HHS also clarified that qualified providers can bill for telehealth services immediately for dates of service starting March 6 under the Physician Fee Schedule at the same amount as in-person services.

As the Pandemic Continues, Telehealth May Play a Larger Role in FFS Medicare

HHS may extend the public health emergency declaration, expected to end September 30, 2020, which may allow greater use of telehealth services in FFS Medicare. Additionally, these policy actions in response to the pandemic could result in further recognition of the importance of this mode of healthcare delivery, potentially resulting in longer-term changes to coverage and reimbursement for telehealth services. Prior pandemics have been catalysts for significant policy changes, such as the 2009 novel influenza A (H1N1) pandemic, which led to the expansion of state pharmacist scope of practice laws, after pharmacists played a key role as immunizers during the response efforts. For telehealth services in FFS Medicare, the response for the COVID-19 pandemic may influence further changes to originating site requirements, covered telehealth modalities, and assessment and treatment by various provider types for other conditions unrelated to COVID-19.

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