Telemedicine’s Potential to Improve Medicaid Programs

September 4, 2019 Andrew Townsend

Useful remote technological tools resolve Medicaid patient and provider challenges 

The two top priority concerns shared by almost all Medicaid programs today are cost and access to care. Increasingly for providers and the people they serve, telemedicine delivers an important opportunity to help resolve both of these challenges.

A cost-effective alternative to traditional in-person medical care, telemedicine achieves many of the same clinical outcomes through the use of technology that includes, at a minimum, audio and visual equipment. Telemedicine delivers more convenient access to care for patients, and gives providers another avenue to treat patients. Both of these advantages enable Medicaid programs to increase access to care, while simultaneously maintaining or lowering costs.

Physicians and other providers tend to offer telemedicine for services that do not require them to lay hands on a patient. This includes ongoing follow-up care, medication management, minor urgent care, and other types of services, such as psychiatric treatments. In addition to a video visit, patients often can use a telemedicine platform to confirm insurance for Medicaid eligibility, make necessary co-payments, and fill out forms, such as informed consent. Patients can participate in video calls through their computer’s webcam, or a mobile device. It’s important to remember that any telemedicine tools must be secure and HIPAA-compliant. Any clinical information gathered should also be logged in an electronic health record (EHR), just as it is with care provided in traditional settings.

In addition to video visits with providers, another type of telemedicine is asynchronous or “store and forward.” This refers to the transfer of images, video, or other data to another site for consultation at a later time. In this scenario, providers gather relevant data such as patient records, lab results, or imaging (MRI scans, X-ray photos, etc.), and can securely transmit those files to appropriate health providers.

Of course, the biggest advantage for patients is convenience. Office visits can require commute times or time off work that may be burdensome. Telemedicine is especially useful in rural areas where the nearest provider may be located far from the patient. It is also useful for more complex illnesses, and for patients who may have difficulty traveling. This improves access to timely care.

It’s no surprise telemedicine is the fastest growing type of medical service provided nationally, according to the American Medical Association. From 2016 to 2017, telemedicine grew 53%, vastly outpacing growth in other areas such as urgent care centers (14%), retail clinics (7%), and ambulatory surgical centers (6%).

The Centers for Medicare and Medicaid Services (CMS) has determined that state Medicaid programs may choose from various HCPCS/CPT codes to identify, track, and reimburse telemedicine services. Depending on each Medicaid program’s State Practice Act, new patients may or may not be permitted to access telemedicine services because an initial in-person visit may be required.

Health and Human Services Secretary Alex Azar favors telemedicine as well.  “I am a big supporter of telehealth and how we can harness that, especially for underserved areas like our rural communities,” he said in congressional testimony in February 2019. “I do suspect there’s significant statutory barriers around reimbursement there, given that most of our constructs were set up in the 1960s for our payment regimes.”

Telemedicine provides reimbursement challenges for Medicaid programs and providers. Given that telemedicine is relatively new, laws and regulations vary from state-to-state and are continuously developing. Some states require providers to be located within the state. Others have passed legislation that permit providers to use telemedicine technology across state lines, but require that each provider is licensed within the state where the patient is located.

Any reimbursement for Medicaid-covered telemedicine services must meet federal requirements for efficiency, economy, and quality of care. According to CMS, "States are encouraged to use the flexibility inherent in federal law to create innovative payment methodologies for services that incorporate telemedicine technology. For example, states may reimburse the physician or other licensed practitioners at the distant site, and reimburse a facility fee to the originating site.”

Medicaid programs do not need to submit separate State Plan Amendments (SPA) to reimburse for telemedicine services if the reimbursement and requirements are the same as in-person services. However, if reimbursement and requirements differ from in-person visits, then an SPA must be submitted.

CMS has granted states latitude in how to regulate and reimburse telemedicine services. According to CMS, “The general Medicaid requirements of comparability, state wideness and freedom of choice do not apply with regard to telemedicine services.”

The agency’s primary concern is access protection. If limitations are placed on telemedicine, then states are responsible for ensuring that access is available in the form of in-person visits.

Ultimately, telemedicine is a wide-open healthcare frontier and CMS is opening the door to this technology today. State Medicaid programs are at the forefront, navigating the new territory and assessing technologies, payment methods, and impact on quality of patient care.  Given the advantages, state Medicaid programs should work to embrace telemedicine and not let the fear of regulations or reimbursement implications slow or inhibit further evaluation.

About the Author

Consultant, Payment Method Development, Government Healthcare Solutions, Conduent.

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