Telehealth providers can celebrate another successful year of growth, as CMS reported a 28% increase over total 2016 payments for telehealth services under the Medicare program. Providers continue to successfully integrate telehealth services into their traditional health care delivery approaches, and are realizing payment opportunities both within the Medicare FFS program and in other sources of revenue. Our thanks to POLITICO Pro Morning eHealth Reporter, David Pittman, who first reported on the story and shared the claims data.
Let’s review the numbers. In CY 2016, Medicare paid a total of $28,748,210 for telehealth services, spread across a total of 496,396 claims. This includes payments to distant site providers and originating site payments. Compare this amount to last year, in which Medicare paid a total of $22,449,968 for telehealth services, spread across a total of 372,518 claims. (The figures are slightly different than reported in prior years, as CMS changed its data collection and calculation methodology this year.)
The result: 2016 saw a 33% increase in the number of Medicare telehealth claims submitted and a 28% increase in total payments. This uptick in total payments is not attributable to fee schedule rate increases, but rather to more providers using telehealth services with their traditional Medicare FFS beneficiaries.
Perhaps the most interesting element in the new data is the significant increase in originating site claims (HCPCS Code Q3014).. Before 2015, approximately half of all distant site claims did not have a corresponding originating site claim. This gap has closed in the last two years, and in 2016, 66% of all distant site claims had a corresponding originating site claim. The remaining gap could be due to providers not bothering to bill for the $25 originating site facility fee, or it could be that some claims were billed when the patient was located at home (a different site of service for which a facility would not bill). The federal Office of Inspector General at the Department of Health & Human Services has announced a new audit project to review Medicare payments for telehealth services and understand the reason(s) for this gap.
Despite the increase, Medicare’s $28.7 million payments in 2016 remains a small portion of the $600+ billion overall Medicare program budget. Remember: in 2001, the Congressional Budget Office estimated it would cost the Medicare program $150 million to cover telehealth services for the first five years ($30 million a year). Fifteen years later, total payments (2011-2016) still have not cracked that $150 million forecast and annual spend has not hit $30 million.
Coverage of telehealth services under Medicare remains limited, with the restrictions established via statute under the Social Security Act. Any notable expansion of telehealth coverage under Medicare would require legislation by Congress. There are several bills pending in Congress to remove these limitations, but until such time, there are five main conditions for coverage for telehealth services under Medicare.
In order to bill Medicare for telehealth services, the distant site practitioner must fully comply with each of these requirements. If the service does not meet each of these above requirements, the Medicare program will not pay for the service. If, however, the conditions of coverage are met, the use of an interactive telecommunications system substitutes for an in-person encounter (i.e., it satisfies the “face-to-face” element of a service).
Providers and other interested parties need not wait on federal legislation to pass. Anyone may send CMS a request to add services (HCPCS codes) to the list of covered Medicare telehealth services. This can include medical specialty societies, individual physicians or practitioners, hospitals, state and federal agencies, telehealth companies, vendors, and even patients. Requests may be submitted at any time on an ongoing basis. The requests will be consolidated and considered during the CMS rulemaking cycle that establishes the physician fee schedule rates.
Each request should address the following:
Email your request to Telehealth_Review_Process@cms.hhs.gov and title it “Telehealth Review Process.” Alternatively, you can mail the request to: Division of Practitioner Services, Mail Stop: C4-03-06, Centers for Medicare and Medicaid Services, 7500 Security Boulevard Baltimore, Maryland 21244-1850. Attention: Telehealth Review Process.
Continued expansions in reimbursement mean providers should make enhancements to telehealth programs now, both for the immediate cost savings and growing opportunities for revenue generation, to say nothing of patient quality and satisfaction.
For more information on telemedicine, telehealth, and virtual care innovations, including the team, publications, and other materials, visit Foley’s Telemedicine Practice.