Telemedicine: Medicaid and Medicare
For purposes of Medicaid, telemedicine seeks to improve a patient's health by permitting two-way, real time interactive communication between the patient, and the physician or practitioner at the distant site. This electronic communication means the use of interactive telecommunications equipment that includes, at a minimum, audio and video equipment.
Telemedicine is viewed as a cost-effective alternative to the more traditional face-to-face way of providing medical care (e.g., face-to-face consultations or examinations between provider and patient) that states can choose to cover under Medicaid. This definition is modeled on Medicare's definition of telehealth services (42 CFR 410.78). Note that the federal Medicaid statute does not recognize telemedicine as a distinct service.
Telemedicine Terms
Distant or Hub site: Site at which the physician or other licensed practitioner delivering the service is located at the time the service is provided via telecommunications system.
Originating or Spoke site: Location of the Medicaid patient at the time the service being furnished via a telecommunications system occurs. Telepresenters may be needed to facilitate the delivery of this service.
Asynchronous or "Store and Forward": Transfer of data from one site to another through the use of a camera or similar device that records (stores) an image that is sent (forwarded) via telecommunication to another site for consultation. Asynchronous or "store and forward" applications would not be considered telemedicine but may be utilized to deliver services.
Medical Codes: States may select from a variety of HCPCS codes (T1014 and Q3014), CPT codes and modifiers (GT, U1-UD) in order to identify, track and reimburse for telemedicine services.
Telehealth (or Telemonitoring) is the use of telecommunications and information technology to provide access to health assessment, diagnosis, intervention, consultation, supervision and information across distance.
Telehealth includes such technologies as telephones, facsimile machines, electronic mail systems, and remote patient monitoring devices, which are used to collect and transmit patient data for monitoring and interpretation. While they do not meet the Medicaid definition of telemedicine they are often considered under the broad umbrella of telehealth services. Even though such technologies are not considered "telemedicine," they may nevertheless be covered and reimbursed as part of a Medicaid coverable service, such as laboratory service, x-ray service or physician services (under section 1905(a) of the Social Security Act).
Provider and Facility Guidelines
Medicaid guidelines require all providers to practice within the scope of their State Practice Act. Some states have enacted legislation that requires providers using telemedicine technology across state lines to have a valid state license in the state where the patient is located. Any such requirements or restrictions placed by the state are binding under current Medicaid rules.
Reimbursement for Telemedicine
Reimbursement for Medicaid covered services, including those with telemedicine applications, must satisfy federal requirements of efficiency, economy and quality of care. States are encouraged to use the flexibility inherent in federal law to create innovative payment methodologies for services that incorporate telemedicine technology. For example, states may reimburse the physician or other licensed practitioner at the distant site and reimburse a facility fee to the originating site. States can also reimburse any additional costs such as technical support, transmission charges, and equipment. These add-on costs can be incorporated into the fee-for-service rates or separately reimbursed as an administrative cost by the state. If they are separately billed and reimbursed, the costs must be linked to a covered Medicaid service.
State Flexibility in Covering/Reimbursing for Telemedicine Services and the Application of General Medicaid Requirements to Coverage of Telemedicine Services
Telemedicine is viewed as a cost-effective alternative to the more traditional face-to-face way of providing medical care (e.g., face-to-face consultations or examinations between provider and patient). As such, states have the option/flexibility to determine whether (or not) to cover telemedicine; what types of telemedicine to cover; where in the state it can be covered; how it is provided/covered; what types of telemedicine practitioners/providers may be covered/reimbursed, as long as such practitioners/providers are "recognized" and qualified according to Medicaid statute/regulation; and how much to reimburse for telemedicine services, as long as such payments do not exceed Federal Upper Limits.
If the state decides to cover telemedicine, but does not cover certain practitioners/providers of telemedicine or its telemedicine coverage is limited to certain parts of the state, then the state is responsible for assuring access and covering face-to-face visits/examinations by these "recognized" practitioners/providers in those parts of the state where telemedicine is not available.
Therefore, the general Medicaid requirements of comparability, state wideness and freedom of choice do not apply with regard to telemedicine services.
CMS Approach to Reviewing Telemedicine SPAs
Link: https://www.medicaid.gov/medicaid/benefits/telemed/index.html
Medicare
Whether expanding Medicare coverage for telemedicine services would increase or decrease federal spending is difficult to predict, but doing so depends on two main considerations:
It is believed that if all or most telemedicine services substituted for or prevented the use of more expensive services, coverage of telemedicine could reduce federal spending. If instead telemedicine services were mostly used in addition to currently covered services, coverage of telemedicine would tend to increase Medicare spending. Many proposals to expand coverage of telemedicine strive to facilitate enrollees’ access to health care. Therefore, such proposals could increase spending by adding payments for new services instead of substituting for existing services.
Because coverage of telemedicine services in Medicare’s traditional fee-for-service program is limited, so is evidence about the effects of such coverage. Thus, Congressional Budget Office (CBO) must often draw inferences from other sources—such as the experience of private managed care plans—when developing cost estimates. However, an important limitation of that evidence is that private plans generally have more ways to influence doctors’ choices and to limit the services that their enrollees use than are available in Medicare’s fee-for-service program (which the Department of Health and Human Services and its contractors run). As a result, even if coverage of telemedicine reduced net costs for some private plans, the greater difficulties involved in ensuring that services are used appropriately in the fee-for-service Medicare program mean that proposals to expand coverage of services in that program could increase federal spending.
Given the substantial interest in proposals related to telemedicine, CBO has prepared the discussion below, which further describes the issues that arise in defining a telemedicine benefit and how CBO estimates the budgetary effects of those proposals.
Telemedicine services include virtual visits with doctors or other professionals, remote monitoring of patients’ conditions, and off-site analysis of medical imaging or test results. Providers may offer telemedicine through various means of communication, including phone calls, video chats, text messages, email, and websites. With the varied possibilities, proposals to expand coverage for telemedicine or telehealth services in Medicare would need to define several factors, including:
CBO’s analysis of such proposals would take into account how they differed from Medicare’s coverage of telemedicine services under current law. Now, Medicare providers can be paid to furnish certain telemedicine services by using specified methods and sites of service—but only for patients who live in rural areas. (Those patients generally visit a facility that has some staff but that accesses some doctors remotely.) In general, Medicare pays the distant doctor or other provider of telemedicine the same fee that Medicare would have paid for an in-person office visit, and the site where the patient receives the services is paid a facility fee. Medicare’s total payments are thus higher for telemedicine services than for equivalent services delivered conventionally. Whether similar arrangements would apply for any expansion of coverage for telemedicine depends on the details of legislative proposals.
Although offering telemedicine to rural enrollees could improve the quality of care that such enrollees receive and could be more convenient for them, doing so might not reduce Medicare spending on their care. More broadly, if rural or urban enrollees would otherwise not have received care because of difficulties in obtaining access to doctors, providing telemedicine might well increase spending on services Medicare covers instead of substituting for services that would have been covered without telemedicine. Without other constraints, the added convenience for enrollees of receiving telemedicine rather than face-to-face care could increase their demand for and use of Medicare-covered services. Provisions governing the cost-sharing requirements that enrollees face for telemedicine services would also affect their demand for those services.
Extracted from a blog post by Lori Housman, Zoë Williams, and Philip Ellis dated July 29, 2015