A key House committee has come up with a draft bill calling for Medicare to pay providers the same rates for telehealth services as for comparable in-person visits—as long as it doesn't raise overall costs.
The lawmakers working on the bill intend to roll it into a broad package of legislation dubbed 21st Century Cures emerging out of the House Energy & Commerce Committee.
The bill would require the CMS to come up with a methodology within four years for reimbursing both hospital and physician telehealth “to the same extent and amount” as comparable in-person services.
Chairman Fred Upton (R-Mich.), is listed as the key member of the working group drafting the legislation. The group also includes ranking member Rep. Fred Pallone (D-N.J.), Rep. Peter Welch (D-Vt.), Rep. Bill Johnson (R-Ohio); Rep. Doris Matsui (D-Calif.), Rep. Bob Latta (R-Ohio), Rep. Greg Walden (R-Ore.) and Rep. Gregg Harper (R-Miss.).
The bill specifically asks the agency to consider telehealth services that meet unmet service needs, substitute for an in-person visit, reduce readmissions or allow patients to be treated at a lower level of care, such as with home health services.
The CMS would have no obligation to implement the changes if its actuary concludes that adjusting reimbursement for remote services would increase Medicare costs.
Telehealth companies have lobbied hard for Medicare payment parity, and several bills have been introduced in the House and Senate in previous sessions. In the 2015 Physician Fee Schedule the CMS expanded telehealth reimbursement to behavioral health and annual wellness visits.
Getting Medicare reimbursement is, for telehealth firms, “if not the holy grail, definitely the shrubbery!” said consultant Lisa Suennen. That's in part because private insurers are likely to follow the government's lead.
Tom Rodgers, managing director for McKesson Ventures, said many insurers are enthusiastic about video visits and telehealth – but only up to a point. Their reluctance comes down to two roadblocks: They're waiting for Medicare to move first and their own actuaries are demanding proof that the services would replace rather than add to the use of healthcare services.
“These actuaries believe that, until proven, they feel that the people who are going to utilize telehealth are your frequent flyers and people who probably otherwise didn't need care,” he said.
That's an issue that may hold back the CMS as well and is acknowledged in the emerging House legislation. Actuaries still question how often patients would substitute virtual or distance visits for more expensive in-person visits, especially those in an emergency department or urgent care clinic.
There's not much good evidence about how much new demand is generated by the convenience and relatively low costs of video telehealth services in particular, said Dr. Ateev Mehrotra, an associate professor of healthcare policy at Harvard Medical School.
But, he said, “My hypothesis is that the vast majority of visits over videoconferencing are new visits, and not substitution.”
Virtual visit firms have generated their own evidence arguing that their use and reimbursement will save money. The Alliance for Connected Care, a telehealth trade group, issued a report relying on survey and internal company data to argue that patients are in fact substituting virtual visits for emergency department and urgent care visits and aren't requiring an excessive number of in-person follow-up visits.
Mehrotra doubts the study, saying that survey data are often unreliable.
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