TELEHEALTH PARITY LAWS: THE REAL STORY

Posted by Rene Quashie on September 06, 2017
Healthcare, Medicaid, Telehealth, Telemedicine / No Comments

State telehealth parity laws, which generally require private payers (and occasionally Medicaid programs) to cover telehealth services if those services would be covered if provided in-person, have long been trumpeted as a means to increase telehealth acceptance.  The argument is simple: given how the availability of health care services is usually directly tied to whether (and how) payers cover a particular service, laws that require payers to cover telehealth services should drive utilization.  A recently published report, however, questions the impact these laws have on telehealth utilization.

The Center for Connected Health Policy (CCHP), the federally funded national telehealth resource center, conducted a five-month study to analyze state telehealth parity laws and the impact these laws may have on telehealth utilization.  In an interesting twist, the report’s authors also interviewed health plan executives to gain insight into how plans cover and reimburse telehealth services, and the issues preventing greater telehealth utilization.  The report should be required reading for all telehealth stakeholders seeking to understand the telehealth reimbursement landscape.

Here are some key general highlights:

  • As of September 2016, 31 states and the District of Columbia have passed telehealth private payer laws.
  • How a parity law is drafted can determine “the expansiveness of reimbursement and can predict telehealth utilization.”
  • Inclusion/exclusion of certain language may create barriers to telehealth utilization by allowing payers to limit the types of services that may be reimbursed.
  • Only 3 states have laws that explicitly require payment parity (meaning payers in these states have to reimburse for telehealth at the same rate as they pay for in-person services).
  • Live video is the modality most often referenced in the parity statutory definition of telehealth. Approximately 70 percent of state parity laws reference store-and-forward, and about 55 percent include references to remote patient monitoring.
  • Only 4 states and the District of Columbia include a site limitation in their parity laws.
  • Unlike the Medicare program, parity laws usually do not include explicit exclusions regarding types of services, types of providers, and geographic locations.

Payer Interviews

As I mentioned, the report’s authors interviewed commercial plan executives, medical officers, and other plan representatives in six states (CA, MS, MT, OK, TX, and VA), resulting in a compelling look into how commercial payers view telehealth.  For plans not participating in interviews, CCHP conducted research regarding their telehealth policies.  Some points to highlight from the interviews:

  • The majority of selected plans only reimbursed for live video. Some plans provide limited reimbursement for store-and-forward, but only for certain specialties.
  • Remote patient monitoring is not being reimbursed by any of the payers that were part of the study.
  • The majority of interviewees confirmed that their plans reimbursed telehealth services at the same rate as in-person services.

Plan interviewees also noted that, notwithstanding the increase in state parity laws, telehealth utilization is generally low.  Among the reasons provided:

  • Patients are reluctant to use telehealth, although once they try it, many respond positively.
  • Patients have a preference to see physicians and other providers in-person.
  • Providers are reluctant to use telehealth for a number of reasons ranging from lack of training, skepticism regarding telehealth, or concerns that they could lose business by providing telehealth.
  • Lack of education and awareness regarding the availability and efficacy of telehealth.

Medicaid

CCHP also spoke with Medicaid representatives and concluded that private payer laws have little impact on Medicaid telehealth policies unless the laws explicitly include Medicaid.  The Medicaid representatives also noted that providers face significant challenges in implementing telehealth programs, including the cost of equipment and billing issues.

Moving Forward

While the report acknowledges the promise of telehealth, CCHP concludes that many obstacles remain, including what it describes as “a broad misconception that, because telehealth private payer laws are in place in many states around the country, telehealth is achieving its promise of providing the same patient benefit and payment as in-person care.” Specifically, the report warns that parity laws “have been weakened by their lack of clarity and often contain clauses that may negate much of the intent of the legislation.”  The report encourages more careful drafting of laws and a more comprehensive implementation plan.  CCHP concludes by asking policymakers to consider, among other things, the following steps:

  • Using explicit language in private payer laws.
  • Ensuring that payment or reimbursement parity language is included in the language of these laws assuming it is the intent of policymakers to have telehealth reimbursed at the same rate as in-person services.
  • Developing a comprehensive Medicaid telehealth policy.

Conclusion

I believe the report is significant for two reasons.  First, it dispels the notion that the existence of state parity laws alone will drive greater telehealth utilization.  As the report makes clear, some of this is due to poorly drafted laws in some states—but I believe that much of the disconnect between parity laws and telehealth utilization is tied to broader issues regarding telehealth utilization generally. The lack of knowledge and education on the part of consumers regarding telehealth, for example, is as big a stumbling block as any other. Second, it appears that while plans have bought into the benefits of telehealth they are cautious regarding how to drive utilization. The report points out that most plans prefer a slower approach to telehealth expansion and favor using methods such as pilot projects to assess potential expansion.

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2017 Digital Health Funding For Emerging Companies Setting Records

Posted by Rene Quashie on July 12, 2017
Healthcare / No Comments

report on table with calculator2017 is setting records for the funding of digital health emerging companies according to two recent reports. Two leading digital health stakeholders StartUp Health and Rock Health published separate reports in the last two weeks highlighting the record number of digital health deals, total investments, and number of deals over $100 million—all great news for the thousands of digital health emerging companies making their way in the health ecosystem. StartUp Health is New York-based organization that brings together a community of innovators, investors, and advisors to help health care-focused companies through various stages of development. Rock Health is a full-service fund based in the Bay Area that supports a wide diversity of digital health emerging companies. Interestingly, while the organizations track funding differently, their reports essentially come to the same conclusion—the funding outlook for digital health emerging companies is as robust as it has ever been.

StartUp Health tracks companies that enable health, wellness and the delivery of care through data/analytics, sensors, mobile, internet-of-things, genomics and personalized medicine. It looks at various levels of funding from accelerator to private equity funding. StartUp Health’s Insights 2017 Mid-Year Report shows that 2017 has surpassed previous years in overall funding and number of new and unique investors focused on digital health. Among the highlights of the report:

  • Q2 2017 had a total $3.8 billion invested—larger than the total annual funding for 2010 and
  • 2011 combined;
  • Mid-year funding stands at a little over $6 billion—setting a record for the most funding by the halfway point of any year;
  • 10 deals over $100 million in the first half of 2017 (tied for most deals in any full year);
  • Approximately 60 percent of deals are considered early-stage (seed and Series A);
  • Mega deals are a trend with 4 deals from 2017 making the top 11 of all deals since StartUp Health began tracking funding in 2010;
  • As expected, funding is most significant in the Bay Area with the Northeast (Boston and New York City) and Chicago also the focus of major deals and funding. Growing digital health hubs include Austin, Minneapolis-St. Paul, Denver, and Seattle;
  • Close to 600 unique investors so far in 2017—almost as many as all of 2015; and
  • No IPOs in the digital health space so far in 2017.

Continue reading…

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NQF Telehealth Draft Report Provides Opportunity For Stakeholders

Posted by Rene Quashie on June 15, 2017
HHS, Telehealth / No Comments

Close up of male doctor with laptop computerThe National Quality Forum (“NQF”) has published a draft report (“Report”) recommending various methods to measure the use of telehealth.  By way of quick background, NQF is a non-profit, nonpartisan organization that seeks national collaboration to improve health and healthcare quality through measurement.  The Department of Health and Human Services (“HHS”) requested NQF to convene a multi-stakeholder committee to recommend various methods to measure the use of telehealth as a means of providing care. Among other things, the Report analyzes the best way to ensure clinical measures are appropriately applied to telehealth, proposes a measure framework, sets some guidelines for future telehealth measurement, and identifies measurement gaps.

To help develop a telehealth measurement framework, NQF began by conducting a comprehensive scan identifying existing measures and potential measure concepts related to telehealth. As explained in the Report, the “framework is a conceptual model for organizing ideas that provides high-level guidance and direction on priorities for what is important to measure in telehealth and how measurement should take place in order to assess its impact on healthcare delivery and outcomes.” The Report analyzed reports and white papers from organizations such as the American Telemedicine Association, the Health Information Management and Systems Society, and the Office of the National Coordinator for Health Information Technology. Continue reading…

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Telemedicine Benchmark Study Provides Great Insight

Posted by Rene Quashie on May 09, 2017
ACA, Healthcare, Hospital, Telemedicine / No Comments

A recent telemedicine industry benchmark survey published by REACH Health provides great insight into where the industry has been and where it is headed. The survey was conducted among U.S. healthcare executives, physicians, nurses and other professionals. Organizations represented in the survey were diverse and included representatives from organizations with a $1 billion or more in revenue (about a third of respondents), and almost half with revenues under $50 million.

 

In reviewing the survey report, there were some significant takeaways:

  • Telemedicine is evolving from a specialty offering to a mainstream service.
  • More than half of respondents consider telemedicine to be a top or high priority.
  • Patient-oriented objectives—including improving patient outcomes, improving patient convenience, and increasing patient engagement and satisfaction—are the three top objectives for telemedicine programs.
  • There is an emphasis on better leveraging specialists with a large majority of respondents ranking this a top or high priority.
  • Nearly half of hospital and integrated delivery network respondents who began their telemedicine programs/initiatives with a departmental approach are transitioning to an enterprise approach.
  • The maturity of telemedicine programs varies widely among service lines and settings of care. Generally, settings requiring highly specialized treatment continue to be more mature than those requiring generalized treatment.
  • Telemedicine technology, reporting and analytics, as well as in-house physicians are viewed as highly important to the success of a program, whereas outsourced physician coverage services less so.

Continue reading…

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PA DOH Releases Proposed Temporary Medical Marijuana Regulations for Doctors

Yesterday the Department of Health (DOH) released the much anticipated proposed temporary regulations for physicians that among other items, set forth requirements regarding: the physician registry, the completion by physicians of a four-hour training course, and issuing patient certifications, as well as prohibitions, including for example, a prohibition against advertising a physician’s ability to prescribe cannabis under the Pennsylvania Medical Marijuana Act (Act 16). As the proposed regulations are not yet effective, DOH will accept comments on them until April 20, 2017. More information about these draft regulations appears on the DOH website, and they are available here.

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Repeal Efforts Fail (for now): Can Obamacare Survive?

Posted by Chris Raphaely and J. Nicole Martin on March 28, 2017
ACA / No Comments

With the House GOP pulling the American Health Care Act (AHCA) due to lack of sufficient support even within its own party, Obamacare is not out of the woods.

The ACA’s two pillars, the individual marketplaces and Medicaid expansion, remain vulnerable and could be used as political bargaining chips in Washington as the battle over “health care reform” plays out in the coming months and years.

In response to the House’s failure to pass the AHCA, the President and House Speaker have expressly said that Obamacare will “implode” and the administration has many ways to see to it that it does sooner rather than later. On the other hand, the administration and Congress could also move on to on tax reform and other items while changes to the marketplaces are implemented by regulation.  The administration already has proposed regulations on the table that has been characterized as a “good faith” effort to implement minor changes to prop up the marketplaces. Reportedly, however, many insurers will want more in the form of funding for cost sharing reductions and reinsurance to keep sufficient numbers of insurers in the marketplaces long term.  Continue reading…

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Minnesota Federal Court Says Cross-Plan Offsets Are Unlawful; Certifies Case for Immediate Appeal

Posted by Chris Raphaely and Dana Petrillo on March 23, 2017
Healthcare / No Comments

gavel and bookThe U.S. District of Minnesota has ruled in Peterson v. Unitedhealth Grp. Inc., No. 14-CV-2101 (PJS/BRT), 2017 WL 991043 (D. Minn. Mar. 14, 2017) that ERISA does not permit United Healthcare (“United”) to claw back alleged overpayments related to patients from one plan by reducing or eliminating payments related to patients from different self-insured plans, dealing a potential blow to the use of an effective tool that health insurers have used to recoup alleged overpayments from providers.

In Peterson, the Plaintiffs were healthcare providers who brought suit against United as assignees of patients who were enrolled in United-administered plans. United had allegedly overpaid Plaintiffs for services provided to certain patients, and offset these alleged overpayments by reducing or eliminating payments for services that Plaintiffs provided to other patients, who were members of different United-administered self-insured ERISA plans. This practice is known as cross-plan offsetting. Continue reading…

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The Telehealth Cost Wars

Posted by Rene Quashie on March 22, 2017
Telehealth / No Comments

How to properly evaluate and weigh cost savings in health care has long been a controversial subject—perhaps nowhere more so than when technology-enabled health care is evaluated. A recent study is a case in point. The journal Health Affairs recently published a study that has caused quite a stir in the telehealth community. Without getting into details regarding methodology and results—best left for a more in-depth article—the study acknowledges that reimbursement for direct-to-consumer (“DTC”) telehealth visits are lower than would be the case for in-person physician or ED visits. However, the study raised two concerns. First, the researchers posited that there could be increased spending for DTC visits “if the direct-to-consumer telehealth visit is more likely to result in follow-up appointments, testing, or prescriptions, compared to similar visits to other settings.” Second, the researchers believe that DTC physicians “may be more likely to recommend that patients have a subsequent in-person visit with a provider.”  The basis for these concerns is not made entirely clear, and quite frankly doesn’t square with my discussions with DTC telehealth stakeholders.

The study also broadly concludes that DTC telehealth may lead to increased utilization as patients will seek care for illnesses for which they would not have sought care had telehealth not been available. More to the point, the researchers calculated that about 88 percent of telehealth usage represents new utilization. In other words, only 12 percent of DTC telehealth usage replaced or substituted visits to other providers. Ultimately, the study argues that DTC telehealth may increase access by making care more convenient for some individuals, and, thereby, may also increase utilization and health care spending. Continue reading…

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Telemedicine Liability – The Real Numbers

Posted by Rene Quashie on February 28, 2017
Telemedicine / No Comments

stethoscope keyboard and phoneAmidst all the interesting legal and regulatory issues implicated by telemedicine, one issue less discussed is the potential liability exposure associated with telemedicine. Many critics have argued that the nature of how telemedicine services are provided will naturally lead to increased risk for malpractice. Available data does not support the argument—at least not yet.

While not a lot of data exists, the Physician Insurers Association of America (“PIAA”) published a July 2015 article comparing telephone treatment medical professional liability (“MPL”) claims versus overall MPL claims reflected in the PIAA Data Sharing Project (“DSP”)—a very large database of MPL claims. Here are the numbers:

  • Of the 94,228 total claims in the DSP during the period from 2004-2013, a total of only 196 claims were linked with telephone treatment.
  • Of those 196 reported claims, 56 resulted in some form of claim payment.
  • The total indemnity loss related to telephone treatment was only $17 million, compared to $8 billion for the total of all MPL losses.
  • Telephone treatment claims represented only about 0.21% of all MPL losses.
  • The average indemnity loss was also lower for telephone treatment at $303,691, compared to $328,815 for all MPL claims within the DSP.

Continue reading…

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The Critical Role of Telemedicine in the Addiction Crisis

Posted by Rene Quashie on February 17, 2017
Telemedicine / No Comments

doctor at laptopTelemedicine is now mainstream. Surprisingly, however, one area in which telemedicine has not been used to its fullest capability is drug addiction treatment. As you are aware, the country is in the midst of an addiction crisis.  The statistics are daunting:

Adding to the woeful statistics are the fairly dismal rates of addiction recovery—assuming that such recovery services are even available. Relapse rates are over 50 percent for certain drugs, and higher for opioid addicts. According to one survey, almost 9 percent of the population needs treatment but only 1 percent actually receives it. The National Institute on Drug Abuse notes that effective substance abuse treatment combines treatment medications with behavioral therapy—and traditional treatment is limited by the availability of treatment professionals who often are not available outside of in-person care settings. Continue reading…

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