Blue Cross and Blue Shield of Alabama resisted paying for most telehealth services for years after their introduction. The insurer, which holds a near-monopoly of the state's commercial market, had cost concerns about the still-evolving technology that electronically connects patients with doctors and other clinicians.
There wasn't even a clear definition of what qualified as a telehealth visit.
Should doctors submit a telehealth claim for every patient phone call? Should real-time video visits be the primary catalysts for payment? Should telehealth be used mostly for primary-care treatments such as ear infections and colds? Should it include more specialized care like psychiatry?
“What is the definition of telemedicine?” asked Doug McIntyre, vice president of network operations at BCBS of Alabama. “Doctor struggled to really tell us what that is.”
But BCBS of Alabama, which operates in a mostly rural state where many people have trouble accessing care, recently shifted gears, in large part because of rapid advances in enabling telehealth technologies.
As of last Dec. 1, the insurer began paying providers for five telemedicine services, including behavioral health and stroke. Amid rising demand, the insurer determined that the technology used to treat patients in those categories was “indistinguishable from a face-to-face visit,” McIntyre said. Earlier last year, BCBS of Alabama also struck a deal with Teladoc to add telehealth for urgent care to its group benefit plans.
More private insurers are paying for telehealth services, a trend experts say will boost relatively low levels of utilization. More than half of states now have laws with rules addressing telehealth coverage.
Nearly all payers now believe telehealth will help rural members access providers and may attract companies that want to offer modern conveniences to employees of the Netflix generation, who expect on-demand services. Insurers are also hoping telehealth will live up to its hype by keeping people out of more expensive healthcare settings.
“They've begun to see the financial value in making these offerings available,” said Nate Lacktman, a healthcare lawyer at Foley & Lardner who specializes in telehealth matters.
Looking ahead, telehealth advocates and providers see seniors on Medicare as the next major arena for growth. Roughly 1 in 5 people older than 65 live outside of a metropolitan area, and seniors usually have worse access to primary-care physicians and specialists if they live in rural areas. Many older adults in urban and suburban areas also face difficulties traveling to their doctors' offices for frequent appointments.
“When you're looking at the chronic condition situations, or simple rural situations (for telehealth), they're (equally) or more relevant to the older population,” said Patricia Smith, former CEO of the Alliance of Community Health Plans.
But Medicare still has restrictive rules for telehealth payment. Insurance, provider and technology trade groups are stepping up their lobbying efforts to pass legislation that will force Medicare to provide greater financial support for the service.
The origins of telemedicine stretch back to the space race in the 1960s. NASA wanted to see how a zero-gravity environment affected astronauts' vital signs. NASA's desire to monitor the health of its faraway astronauts nurtured a curiosity in “Earth-bound physicians trying to diagnose or treat a patient in a remote location,” reads a 1996 essay in the Bulletin of the Medical Library Association.
Today, telehealth includes everything from telephone consultations and live video feeds via Skype to digital CT scans and remote monitoring of intensive-care units. Behavioral health, dermatology, radiology, infectious disease and stroke are commonly covered service lines, and primary-care services are becoming a major focus, since they usually involve quicker diagnoses.