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While many United States healthcare providers are returning to their in-person offices, many others are digging in to offer hybrid telehealth or exclusive telehealth practices moving forward. Understanding the future of telehealth reimbursement is then a pivotal issue. As a hub for telehealth consultants and trainers, the Telehealth.org is receiving daily requests for assistance from behavioral health groups and independent practitioners seeking to position themselves for telehealth expansion optimally. The information below is a quick synopsis of reimbursement trends reported by Telehealth.org since the start of the Public Health Emergency (PGE), combined with perspectives gained in almost 3 decades of focus on telehealth reimbursement by our Founder, Dr. Marlene Maheu.1
The Future of Telehealth
When thinking about the future of telehealth, various leading indicators are traditionally discussed by stakeholders, but none is as telling as reimbursement. Simply stated, clinicians need to get paid if they are expected to deliver care. The key to understanding the future of telehealth then is understanding financial disincentives and incentives for telehealth reimbursement.
Follow the Money
Let’s start with disincentives. The simple fact is that far too much of the US healthcare reimbursement system supports the delay of services rather than identifying early dysfunction and delivering timely care. Here’s how it works: much of US-based healthcare is purchased by employers for employees. In setting their rates and making their reimbursement decisions, insurance companies make predictions developed into actuarial tables developed by actuaries who look at the specific characteristics of an employee mix to determine which coverage will maximize their profitability.
The reimbursement fact missed by many healthcare professionals is related to those actuarial tables and employment tenure, which is estimated based on how long their beneficiaries (employees) will remain with employers. Employees generally don’t stay with a company to retire after 40 years. Rather, the median number of years that wage and salary workers have worked for their current employer is currently 4.6 years, and it changes by age group. For example, the median job stay for workers age 25 to 34 is less, coming in at 3.2 years. See the Economic News Release from the Bureau of Labor Statistics for details of other age groups. The point is that employers typically purchase health plans that are designed to cost less because they offer benefits for the short term.
Many US-based insurance companies are thus, in essence, disincentivized from intervening in a problem in its early phase. It then would follow that paying for early intervention is not to the employer or insurance company’s benefit. For this reason, many early detection assessments or treatments are not reimbursed by many insurers. Take the example of formal psychological testing, which ceased to be a covered service for all clients and patients since the early days of managed care. Why investigate too deeply? Treating serious mental illness or addiction can be costly… To counterbalance these forces, many highly-rated employers insure themselves or purchase more expensive plans from leading insurance carriers rather than settling for the plans made available to the general public.
Unfortunately, many small business owners and large employers cannot afford higher healthcare coverage rates. Therefore, the majority of employers, by necessity, pay for less expensive plans. Whether they realize it or not when they purchase their insurance coverage for employees, they make the implicit decision to delay the cost of problem resolution to when another employer is involved. Why pay for prevention now if someone else is likely to pick up the tab later? Kicking the can down the street, if you will, is the norm.
What about Telehealth Reimbursement?
Healthcare enthusiasts have long argued that telehealth will save money in the long term. Telehealth, therefore, can be one of the needed solutions to escalating healthcare spend in the US. Why? Most healthcare practitioners don’t get exposed to financial modeling as part of their training. Plus, the healthcare industry’s lack of incentivization for offering early detection and intervention is likely to be experienced as abhorrent to practitioners, whose focus is on helping those in need, and the sooner, the better. For decades, it has been a frustration of the telehealth community that while hundreds of groups have documented these facts, only minor gains had been made toward telehealth adoption before COVID and the PHE. Now that the world has experienced firsthand the benefits of telehealth services, clinicians struggle to know what to expect next. At Telehealth.org, it is clear that the key to understanding the future of telebehavioral health, particularly, is recognizing that the dynamic of disincentivization vs. incentivization is foundational in making decisions about where to set one’s focus for the future.
One of the key calling cards of telehealth is that it is proven to effectively deliver care in the early phases of a client or patient’s dysfunction. Early detection leads to early treatment in the trajectory of an individual’s health challenge. Using telehealth then, patient welfare and costs can often both be improved over the lifespan.
For instance, a 5-year-old’s Attention-Deficit- Hyperactivity- Disorder (ADHD) can be identified and treated before they get into chronic patterns of misbehavior at school, an escalating pattern of associating with similarly untreated children, petty crime, juvenile detention, imprisonment at a later age, and increasingly serious and expensive issues as they grow older.
Medicare Telehealth: Paving the Future for Expanding Telehealth Practices
For those considering a hybrid or full-time, exclusive telehealth future, Telehealth.org has been suggesting that almost a year centering one’s future telehealth efforts on serving Medicare telehealth beneficiaries has been well advised. As described in the July 2020 Telehealth.org article entitled, Waiting to Exhale about Telehealth after COVID-19, Medicare started announcing last summer that it intends to continue its telehealth expansion. Private insurers, on the other hand, started announcing rollout experiments in a variety of states. For example, see Telehealth.org’s States Taking Immediate Action to Prevent Payer Telehealth Coverage Rollbacks for which US insurers were involved.
How do the previously described incentivization processes make sense when considering Medicare as the single best source of telebehavioral health referrals in the future? How does it fit into the “follow the money” theory described above? You probably guessed it…as the country’s stop-gap insurer for disabled and retired individuals, Medicare represents the “end of the road” about kicking the can. If Medicare delays delivering either assessment or treatment services, it will only cost more later on. That’s why many tests that are denied in one’s working years by even the best of employer’s based healthcare plans are commonly covered for Medicare-funded beneficiaries. Also, the avid Telehealth.org newsletter reader may have noticed the Telehealth.org blog alert that the 2018 announcement of telehealth usage metrics by the Centers for Medicare and Medicaid Services (CMS). It reported that 85.4% of all CMS telehealth reimbursements in 2016 were telebehavioral in nature. All the other healthcare disciples comprised 14.6% of all other telehealth spend for the year. See CMS Congressional Report: 85.4% of all Telehealth Providers Used Mental Health CPT Codes. Telebehavioral health is where the action is — and has been for decades.
Let’s first consider the medical example of Carlos, a 60-year-old who has developed a sore on his left big toe. If that sore is an early warning sign of diabetes, it can lead to many complications, including amputation and non-ambulatory. If Carlos waits until he is retired and finally goes to his physician at 65 to be treated under his Medicare benefits, his potential diabetes would probably be more advanced and costly — but such diagnosis and treatment is no longer the former employer’s insurance-funded problem. It now is a Medicare-funded problem.
Medicare is incentivized to treat Carlos immediately and avoid more costly interventions later when Carlos possibly requires amputation. Because the expense of a non-ambulatory patient is high, Medicare then has a vested interest in funding and supporting a wide variety of interventions that can help early detection and treatment, including telehealth.
At a more behavioral level, imagine the pregnant, unwed 15-year-old in an immigrant family who runs away to have her child. In addition to the medical challenges involved, the biopsychosocial stressors that are likely to emerge and linger can be difficult to estimate financially. However, without making this article terminally long, let us suffice to say that every clinician reading this article is likely to feel those many costs in their bones.
Connecting the Dots for Medicare Telehealth Reimbursement
While Telehealth.org does not have a crystal ball, we can help you connect the dots to make an informed decision regarding your telehealth service development, whether it involves a hybrid telehealth approach or exclusive telehealth in the future. To dig deeper, please feel free to browse Telehealth.org’s growing digital library of COVID-related Medicare articles, including those below. If you haven’t registered for Telehealth.org’s free weekly newsletter, we send you these articles by email and see this Telehealth.org Newsletter registration page.
Recent Medicare Telehealth Development
On April 30, the 2021 Health Act, known as Creating Opportunities Now for Necessary and Effective Care Technologies (CONNECT), was re-introduced to Congress. Sponsored by 50 senators, it could eliminate geographic restrictions for Medicare telehealth. This important piece of legislation could also contribute to permanent and more lenient COVID-19 telehealth practices. If passed, among other things, the bill would:
- Allow the Centers for Medicare & Medicaid Services (CMS) to waive certain restrictions, such as geographic restrictions, for services provided in high-need health professional shortage areas, thereby expanding reimbursable telehealth sites to the home and other sites.
- Exclude mental health and emergency medical services, as well as services provided at rural health clinics, federally qualified health centers, and Indian Health Service facilities, from previous geographic restrictions
- Allow the CMS to waive coverage restrictions during national emergencies generally.
- The Secretary of Health and Human Services would have the authority to waive telehealth restrictions.
- Require that a study be conducted on how telehealth has been used during the pandemic.
Additionally, if passed, the Act would require that the Medicare Payment Advisory Commission report on information relating to the access of Medicare beneficiaries to telehealth services at home. The Center for Medicare and Medicaid Innovation will also be tasked with testing alternative payment models relating to expanded telehealth services.
The CONNECT Act & Medicare
Telehealth became a popular topic during the coronavirus pandemic when the federal government allowed for more lenient telehealth practices. As a result, there is concern that seniors with Medicare could lose access to telehealth once the pandemic comes to an end; however, the CONNECT Act would provide the appropriate protection to prevent what is known as the telehealth cliff. Below is a summary of what the 2021 CONNECT Act would accomplish.
- Removal of all geographic restrictions on telehealth services
- Expand telehealth sites to the home and other sites
- Health centers and health clinics located in rural areas would be able to provide telehealth services
- The Secretary of Health and Human Services would have the authority to waive telehealth restrictions
- Telehealth restrictions would be waived during public health emergencies
- Require that a study be conducted on how telehealth has been used during the pandemic.
Will You Be Active in the Future of Telehealth?
After the PHE and COVID, telehealth will continue to play a vital role in the US healthcare system. The use of telehealth more understood and accepted since the start of the pandemic, as the general public has become significantly more comfortable using telehealth services. Already, many patients report preferring to see their primary care physician via a video session. The same applies to behavioral health care. The CONNECT Act would expand these services even more.
A few barriers still exist, however. A larger leap forward would include removing barriers to Medicare coverage of audio and video health services, particularly for vulnerable populations. Current legislation only approves telehealth services for patients living in certain rural areas. At the same time, those in urban and suburban populations are not given the same flexibility and are instead excluded from accessing virtual care. This creates a serious inequity in access to healthcare. If you are serious about telehealth, become an advocate with your elected officials. Make yourself the pebble in their shoe with letters and emails to let them know how you want them to vote.
Telehealth provides high-quality, safe, and equitable access to a wide variety of healthcare services. With the approval of the CONNECT Act, access to healthcare could increase dramatically, allowing more American Medicare beneficiaries to enjoy the many benefits of telehealth. Also, Medicare, in many ways, sets the bar for insurance innovation in the US; it is the bellwether for providers and provider groups seeking to focus their telehealth service development efforts as they make themselves a part of the future of telehealth.
1 Maheu, M. M., Pulier, M. L., McMenamin, J. P., & Posen, L. (2012). Future of telepsychology, telehealth, and various technologies in psychological research and practice. Professional Psychology: Research and Practice, 43(6), 613–621. https://doi.org/10.1037/a0029458
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What are your thoughts about this article? Please comment below.
Providing Tele Health has been an huge advantage to my caseload. Practicing in Southwest Louisiana where my clients were able to continue being served through COVID and then the two major Hurricanes Laura and Delta, the Ice Storm and the Flood that occurred this month has allowed them to continue to have therapy through a very stressful time in which many lost their homes one or and some 3 times since August of 2020. Besides all the barriers that exist to clients being able to go to therapy such as cost or having to leave from work for therapy. Tele Health has opened up the opportunity for many elderly or impoverished clients who can not drive due to disability or inability to access transportation or pay for child care. The reasons Tele Health is a value are to many for me to list at this time. Therapy is a reflection of the overall health care system. Providing access for more disadvantaged individuals is increased through Tele Health.
Kimberly, Lisa, Melissa, J, and Tom,
Each of you described scenarios where people would not get the needed help they deserve. And that’s the problem. At issue here is that most third-party carriers ~don’t want~ to pay for telehealth services. They all-too-often are in the business of making money, not helping people. That’s why they are refusing or rolling back telehealth coverage. To serve these people is an expense they can avoid if they simply deny telehealth coverage. As each of you has so well outlined, along with thousands of studies and reports, telehealth works and is needed, but most insurers are more concerned about their bottom lines than helping people.
What to Do?
Our only recourse is to take these succinct descriptions of how badly telehealth is needed and is helping to our legislators. Put your scenarios in a single-page letter, don’t include any Protected Health Information that could identify the people that you describe, and sent it to all your elected state officials. Please ask them to vote in support of all telehealth bills. You will find the bills listed in the TBHI blog by searching for “legislation” here: https://blog.telehealth.org/blog
I’ve been working to support telehealth for the last 28 years and I can tell you that we’ve never had this window of opportunity. Please take the 30-45 minutes needed to mail your elected officials to ask that they do whatever they can to make telehealth coverage ~required~ by all insurers. If we act now, this week, our collective voices can make a difference.
While you are at it, send the same letter to your state commissioner and ask them to help make sure that telehealth remains available to everyone. If you have a payor who has not been paying for telehealth, tell your commissioner about that, too. Let’s not kick the telehealth can down the road so that the people we care about become someone else’s problem to solve. Please act today. You can find the addresses to your elected officials by typing “your state name.gov” in a web browser. That search will take you to your state government’s website, where there should be a listing of elected officials.
If you can, you may also want to mobilize your state professional associations if they haven’t yet acted in support of telehealth. They have the clout to make noise on behalf of telehealth as well. Send them a copy of your letter and ask them to please help make telehealth permanent by lobbying your state’s elected officials to pay you for telehealth. The succinct case scenarios are very effective in swaying legislators. Give your state association that information so they can do their part with your information, too.
One simple letter can go far.
Let’s do this. We have power in numbers.
Providing counseling services in rural Iowa, our providers find that technology is an issue with elderly and lower-income individuals. Broadband coverage is spotty in many areas, and many individuals do not have a comfort level with computers, cameras, etc. The chronically mentally ill are also suspicious, sometimes, of technology. While telehealth removes many barriers to accessing care, other barriers remain. Educating the public and legislators about telehealth, technology, and connectivity is an important piece of this puzzle. I think the pandemic revealed these gaps in service delivery much faster than they would have been revealed otherwise.
My clients have been grateful to receive their behavioral health sessions via video with audio during the pandemic. My elderly clients felt safer, and are now accustomed to being in their home environment when talking about difficult issues. Access to and use of technology has not been an impediment for anyone in my caseload. My younger working clients, and those at home with young children, find it easier to schedule sessions when they don’t have to factor in travel time. None have mentioned an issue having enough privacy to feel comfortable.
I would like to see telementalhealth continue at an adequate rate of reimbursement; not a dramatically reduced rate. While in some ways there isn’t as much overhead, my education and continuing education still cost the same – so reimbursement should have parity with f2f in my opinion..
One problem is that in Pa, Medicare will not pay for LPCS or MFTS to see
Medicare patients….still. Please write to your state representatives to get
this changed. If we don’t, even if they expand Medicare to even more access
through telehealth ongoing, there won’t be enough therapists to see the clients!
For younger clients who win disability, some are given Medicare immediately.
They are the same client before the disability determination-as after. An LPC
has to stop treatment at that time. Pretty poor quality of care at that point as they
must pursue linking with a new therapist in their greatest time of need and vulnerability.
Medicare and private carriers should use the following model for telehealth payment: each policy should have a TELEHEALTH RIDER BENEFIT: the carrier will pay 50:50 (insurance pay half, patient pay half) up to an annual insurance benefit limit of $1000.00 The fees should be based on physician BILLED CHARGES (no price controls) The doctors would get paid what they are actually worth with cost containment via co-pays and annual benefit maximim
Great article! Thanks for filling full of useful information.
Carolyn, Thank you for taking a moment to voice your appreciation!
One of the strengths of telehealth is accessibility. My clients are able to connect with me at their workplace on their noon hour, for example. They don’t need to take time off from work to come and see me, or try to find a time after work to come into the office. For those with small children, they are able to connect with me from their homes without having to get a babysitter. For older populations who may not have transportation etc the advantages are obvious. I really don’t see a downside to offering telehealth or in being reimbursed for telehealth. The pandemic has pointed out that one of the strengths of telehealth mental health is that anyone can access it at almost any time this is a tremendous advantage.