• Revenue Cycle Management
  • COVID-19
  • Reimbursement
  • Diabetes Awareness Month
  • Risk Management
  • Patient Retention
  • Staffing
  • Medical Economics® 100th Anniversary
  • Coding and documentation
  • Business of Endocrinology
  • Telehealth
  • Physicians Financial News
  • Cybersecurity
  • Cardiovascular Clinical Consult
  • Locum Tenens, brought to you by LocumLife®
  • Weight Management
  • Business of Women's Health
  • Practice Efficiency
  • Finance and Wealth
  • EHRs
  • Remote Patient Monitoring
  • Sponsored Webinars
  • Medical Technology
  • Billing and collections
  • Acute Pain Management
  • Exclusive Content
  • Value-based Care
  • Business of Pediatrics
  • Concierge Medicine 2.0 by Castle Connolly Private Health Partners
  • Practice Growth
  • Concierge Medicine
  • Business of Cardiology
  • Implementing the Topcon Ocular Telehealth Platform
  • Malpractice
  • Influenza
  • Sexual Health
  • Chronic Conditions
  • Technology
  • Legal and Policy
  • Money
  • Opinion
  • Vaccines
  • Practice Management
  • Patient Relations
  • Careers

Telehealth and the law: the challenge of reimbursement

Publication
Article
Psychiatric TimesPsychiatric Times Vol 35, Issue 10
Volume 35
Issue 10

When it comes to telemedicine services, the primary factor affecting reimbursements is legal policy.

Technological advances continue to expand the healthcare delivery marketplace. Through technology, more and more providers are trying to cash in on telehealth. As with any other business, the healthcare industry is driven by profitability. 

In healthcare, profitability is generally driven by reimbursements from government payers such as Medicare and Medicaid, private insurers such as Blue Cross and Aetna, and, to a smaller degree, self-pay patients. When it comes to telemedicine services, the primary factor affecting reimbursements is legal policy.

Under the Medicare program, which covers approximately 15 percent of Americans, telehealth services are typically reimbursable only if they are provided for beneficiaries who live in certain rural or underserved areas, and usually require the beneficiary who is receiving the telehealth services to be physically located at certain “originating sites,” such as practitioners’ offices, hospitals, rural health clinics, and nursing homes. Medicare publishes a list of procedures, which are designated by billing codes, that Medicare will pay for if all of the required conditions are met. Medicare also has additional rules that must be followed in order for telehealth services to be reimbursable, such as limitations on the type of technology that may be used and what type of practitioner may provide covered telehealth services. 

If a telehealth service is covered under the Medicare rules, both the remote practitioner and the originating site may be entitled to bill for the service. The remote practitioner is entitled to bill for the professional service that is provided, and the originating site is entitled to bill for a facility fee. When submitting claims to Medicare for telehealth services, each provider must add a billing code modifier to identify the service as a telehealth service. The fee is subject to applicable deductibles and coinsurance. Additionally, Medicare fee schedule reimbursement for telehealth services are not necessarily on par with the fees payable for similar in-person services.

Reimbursement for telehealth services provided for non-Medicare patients is dependent upon the jurisdiction where the patient is located while receiving the services. Most states have legal policy governing telehealth services, and there is a lack of uniformity with regard to state telehealth guidance, including in the areas of site-of-service requirements and the types of technology that may be used. And perhaps even more importantly, there is also variation regarding whether private insurers are obligated to reimburse for telehealth services.

Most states require private insurers to cover telehealth services. However, state laws vary regarding the amount that private payers must reimburse. Some states require private insurers to reimburse for telehealth services “on par” with, i.e. at the same rates that the insurer would have paid if the same service was provided to the patient in person. Other states, like New York, require private payers to cover telehealth services, but either do not require or are silent with respect to parity for reimbursement. And yet other states have some form of reimbursement requirement for telehealth services that does not quite equate to on-par reimbursement. For example, New Jersey requires private insurers to reimburse for services provided through telehealth, but only requires that the rates for telehealth reimbursement may not exceed the rate of reimbursement if the service was provided in person. And yet other states have no requirement for private payers to cover any telehealth services. 

Like other types of healthcare, telemedicine profitability is driven primarily by payers, including Medicare, Medicaid, and private insurance companies. Even within the same jurisdiction, the laws and rules relating to each of these types of healthcare payers can be vastly different, which can create great difficulties for providers, especially providers delivering telehealth services from different states. In most jurisdictions, insurance companies have great discretion in determining how much to pay telehealth services, or even whether to pay at all. It is up to each provider to become aware of reimbursement rules for services they will provide for patients in another state before those services are provided.

John D. Fanburg is chair of the Health Law Practice and the managing member at Brach Eichler LLC, a law firm based in Roseland, NJ. He can be reached at (973) 403-3107 or jfanburg@bracheichler.com. Jonathan J. Walzman is an associate in Brach Eichler’s Health Law Practice.  He can be reached at (973) 403-3120 or jwalzman@bracheichler.com.

Related Videos