The rapid spread of the Coronavirus Disease 2019 across the globe has turned the world on its head. Every sector of the economy is experiencing some form of distress, especially the healthcare industry. This is due, in part, to the often in-person and face-to-face contact involved in healthcare services delivery.
In response to the pandemic, the relaxation of certain federal health regulatory requirements (such as privacy laws and Medicare/Medicaid billing rules) was necessary to allow physicians and other providers to utilize telecommunications and digital health products to consult, diagnose, treat, monitor and follow up with patients from a remote location – known as “telehealth” or “telemedicine” services.
The COVID-19 pandemic has caused a noticeable shift in how telehealth services are valued and has accelerated the adoption of telecommunications and digital health products to deliver patient care. This article outlines the historical regulatory and financial barriers to the adoption of telehealth services, how policymakers have temporarily waived many of these barriers in response to the COVID-19 public health emergency and the benefits of such actions, and the anticipated new path forward for telehealth services in the nation’s healthcare system after the pandemic.
Barriers to Telehealth Adoption
The concept of delivering healthcare services to patients from a remote location has arguably existed since the advent of the telephone, but advancements in telecommunications technology and broadband speeds in the 21st century have expanded the capabilities of telehealth and the potential benefits of its broad adoption.
A key moment in national recognition of telehealth was when Congress amended the Social Security Act to allow coverage for certain telehealth services under the Medicare program. After more than two decades, however, the healthcare industry still has been slow to adopt telehealth services as a fundamental way to deliver patient care. Theories explaining the industry’s reluctance abound, but at a high level can be boiled down to the unique interests of the key stakeholders (providers, payors and patients) and a labyrinth of regulatory restrictions.
- Licensure: State-level regulations of health professionals require physicians and advanced practitioners to obtain licensure or registration from the state where the patient is located (the so-called “patient of origin principle”) to deliver telemedicine services. Because licensure requirements vary from state-to-state and may require significant expenditure of time and resources by prospective licensees to obtain and maintain multiple state licenses, the patient-of-origin principle, in practice, imposes a considerable impediment to the cross-border delivery of telehealth services.
- Reimbursement: Payment policies of government and commercial payors that are designed to ensure the quality and medical necessity of the telehealth services covered, and physicians’ responses to such policies, have contributed to the slow adoption of telehealth. The most common of such reimbursement policies relate to (1) where the provider and patient are located when the service takes place, (2) what type of provider is delivering the service and (3) what modality was used to deliver the service. Indeed, Congress imposed such coverage limitations under the SSA, which most stakeholders agree has severely impacted the extent to which Medicare providers have incorporated telehealth services into their practices. Another common, hotly-debated issue relates to differing reimbursement amounts for services delivered in-person versus telehealth.
- Remote prescriptions: The ability to prescribe medications remotely faces many roadblocks which restrict the full embrace of telehealth services. The Ryan Haight Act (2008) prohibits a physician practicing telemedicine from prescribing controlled substances without an in-person evaluation except in certain circumstances (such as a public health emergency). States also have a range of regulatory frameworks within which remote prescribing is regulated – ranging from restrictive (such as requiring in-person examinations) to more liberal (such as allowing electronic prescriptions).
- Broadband access: Not all geographic areas in the United States have equal access to the internet at broadband speeds necessary to support real-time/audio-visual interactions. Even with the presence of federal subsidies for these services, rural areas that would experience a proportionally greater benefit from access to telehealth services still struggle to find adequate funding for broadband access and expansion.
- Patient adoption and use: Historically, there have been few obvious incentives or opportunities for patients to change how they receive healthcare services in-person. Most people only seek healthcare when they become ill or for occasional checkups, with the majority of those treatments paid for by a government or commercial payor. Patients thus do not act as economically rational consumers when seeking healthcare services; consequently, the delivery modules are not patient-driven but provider-driven.
Telehealth as a Response to COVID-19
COVID-19 has put a significant strain on the resources and abilities of healthcare organizations and providers to deliver items and services to patients in-person. In response, government regulators at all levels have implemented measures designed to control the virus’s spread (such as stay-at-home orders) and preserve resources (such as prohibitions on nonurgent medical procedures).
One of the critical measures taken to keep patients safe at home while still being able to access medically necessary services during the pandemic was the immediate expansion of telehealth services, accomplished through temporary waivers of regulatory provisions that historically have inhibited its adoption. These telehealth waivers addressed four broad categories: licensure, location, modality and reimbursement.
Licensure
At the outset of the COVID-19 public health emergency, many states quickly found themselves with an insufficient supply of health professionals. Some states already had emergency response plans built into their existing laws (for example, California activated its plan via executive order, allowing out-of-state licensed medical professionals to provide and be reimbursed for services delivered to patients in California during the public health emergency). In other states, governors and medical licensing boards swiftly responded by temporarily relaxing or waiving licensure and registration requirements for out-of-state licensed physicians and other advanced practitioners (for example, Texas permitted physicians licensed in other states to obtain an emergency license to practice in Texas or hospital-to-hospital credentials). Also, on the federal level, the Centers for Medicare and Medicaid Services waived requirements that certain health professionals be licensed in the state in which the beneficiary is located.
While states certainly have an interest in ensuring health professionals are qualified to treat patients within their borders, the ease with which state-specific licensing regulations were waived in reliance upon another state’s licensure process, in concert with the conspicuous lack of associated negative outcomes, suggests that many state licensing regimes should be reevaluated before these temporary licensure waivers expire as CMS Administrator Seema Verma has acknowledged.
One possible vehicle through which states could efficiently reevaluate and standardize their licensing standards is the Interstate Medical Licensure Compact, which is designed to streamline the licensure process for physicians delivering services across state borders. In 2017, the IMLC became operational and, as of September 2020, has been adopted by 29 states as well as the District of Columbia; however, the patchwork regulatory regime of the 21 nonadopting states – including Texas – still represents a major hurdle to overcome.
Medicare and Medicare Advantage
The SSA restricts coverage of “telehealth services” under the Medicare program to treatment provided only in certain geographic areas (such as rural areas), to patients located at defined “originating sites” (such as hospitals, clinics or physician’s offices), by qualified providers (such as physicians or advanced practitioners) through a synchronous or interactive audio/visual telecommunication platform. In recent years, without amending the SSA, Congress and CMS have taken steps toward expanding coverage of telehealth services through demonstration projects and by defining certain technology-based services (such as virtual check-in and remote patient monitoring) as outside the “telehealth services” definition. However, the COVID-19 public health emergency required a quicker, more robust response, prompting Congress and CMS to authorize significant regulatory waivers.
On March 6, Congress passed the Coronavirus Preparedness and Response Supplemental Appropriations Act of 2020, which added 42 U.S.C. 1320b–5(b)(8), authorizing the Secretary of the Department of Health and Human Services during the declared public health emergency to temporarily waive certain Medicare coverage requirements for telehealth services related to:
- Geographic area: The waiver of geographic area restrictions means patients located in a defined emergency area (in this case, the whole country) will be covered;
- Originating site: The waiver of patient location restrictions means patients can be treated in an at-home setting and avoid entering the community; and
- Modality: The waiver of modality restrictions means providers can use telephone-only communications to deliver certain telehealth services if the technology is capable of real-time, audio-visual communication if needed (smartphones, for example).
HHS also announced that, using its enforcement discretion, it would not require healthcare providers to have a preexisting relationship with a patient before providing telehealth services.
Congress also passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was signed into law on March 27. Under the CARES Act, the Secretary of HHS is authorized to expand the use of telehealth for certain services that previously were required to be delivered in-person to be reimbursed by Medicare (examples include assessments of patients with end-stage renal disease receiving home dialysis, check-in visits with hospice patients and remote monitoring of patients receiving home health services). The CARES Act also expands the list of eligible providers who may review, certify and recertify plans of care for Medicare home health patients to include advanced practitioners, such as nurse practitioners, clinical nurse specialists and physician assistants (if home health services are within the scope of providers’ state licensure).
In addition, CMS released guidance with additional waivers intended to increase the number of Medicare-enrolled providers available to furnish all sorts of telemedicine and remote treatment and encouraged providers to use technology-based services for patients in their home or residence. Under these waivers, multiple covered services were approved for remote visits, including behavioral health, physical and occupational therapy and many others that were previously deemed inappropriate for telehealth services.
Under additional CMS guidance, Medicare Advantage plans were encouraged to expand their lists of covered telehealth services, to eliminate referral or prior authorization requirements and to waive or reduce all patient cost-sharing obligations for COVID-19-related treatment, including laboratory tests and telehealth benefits.
Medicaid
State Medicaid programs already have broad authority to tailor coverage for telehealth services as they deem appropriate, which authority becomes even more flexible in disaster or emergency conditions. In response to the COVID-19 public health emergency, CMS released guidance with recommendations that states seek waivers to take advantage of this flexibility to remove administrative burdens and expand access to needed services. In addition, state Medicaid programs were encouraged to explore the full limits of their coverage authority applicable to home and community-based services.
Nearly every state has submitted and been approved for Section 1135 waivers, which include authorizations for: (1) temporarily increasing individual eligibility cost limits, (2) modifying service, scope or coverage requirements, (3) exceeding ordinarily applicable service limitations, (4) expanding provider qualifications to maximize the pool of providers who can render services and (5) covering more services.
Commercial payors
Many commercial health insurers have likewise modified their reimbursement policies temporarily to expand coverage for, and access to, treatment delivered via telehealth, such as modifications waiving patient cost-sharing obligations and prior authorization requirements. Several state governors have also issued emergency executive orders mandating that commercial payors cover services delivered via telemedicine on the same basis and at the same rate as if the services were delivered in person.
In addition, recognizing the substantial role remote medicine is likely to play in healthcare going forward, some commercial payors have directly partnered with telemedicine platforms and applications to expand options for enrollees to seek a range of healthcare services from their own home.
Grant programs
Congress and federal agencies have greenlit grant programs designed to promote increased use of telehealth services. For example, the Federal Communications Commission currently administers a grant program, the COVID-19 Telehealth Program, specifically designed to provide funds to certain healthcare providers to purchase the infrastructure, equipment and support services necessary to enable them to provide telehealth services during the COVID-19 public health emergency. Another FCC grant program, the Connected Care Pilot Program, a $100 million multiyear pilot study on the long-term impacts of telehealth, is dedicated to funding healthcare providers in delivering telemedicine services targeted at low-income or veteran patient populations, including the costs of broadband connectivity, network equipment and information services. Meanwhile, the Health Resources and Services Administration, a division of HHS, is offering funding through a range of grant programs intended to expand availability of telemedicine services and study the long-term benefits. Included among these programs is one that is intended to promote cooperation among state medical licensing boards to develop and implement policies within their jurisdictions that will remove statutory and regulatory licensing barriers to cross-border telemedicine delivery.
Conclusion
The COVID-19 pandemic has highlighted the utility and value of telehealth services in delivering patient care. While the regulatory waivers are temporary, federal and state policymakers appear aligned in their support of expanding coverage for telehealth services and extending the waivers beyond the COVID-19 public health emergency, and some have already begun to make them permanent.
At the time of this article, federal legislation (Creating Opportunities Now for Necessary and Effective Care Technologies (CONNECT) for Health Act of 2019) has been introduced with support from a bipartisan group of Congressional members advocating for telehealth waivers – particularly the allowance of audio-only modalities – past the public health emergency to study telemedicine’s effectiveness. Further, the president has signed an executive order that calls upon CMS to propose certain telehealth waivers that should be made permanent and authorizes the agency to test new payment models to extend telehealth flexibility beyond the COVID-19 pandemic for Medicare beneficiaries and providers in rural areas.
Moreover, CMS Administrator Verma has indicated the agency supports such actions and is already reviewing how it may implement them through regulatory action, including whether reimbursement rates for telehealth services should be commensurate with rates for in-person services. CMS also issued an advance copy of its proposed 2021 Physician Fee Schedule rule, which contains coverage for many new telehealth services under the Medicare program to expand access to and use of telehealth. This robust list of proposed new telehealth services is a significant deviation from past years in which CMS added only a limited number of telehealth services each year. CMS, in consultation with the Medicare Payment Advisory Commission, is exploring even greater expansion of Medicare coverage for telehealth services that are reimbursed under accountable care organizations and other alternative payment models rather than traditional fee-for-service models.
At the state level, a number of legislatures, such as Colorado and Rhode Island, have already introduced or passed legislation to: (1) expand coverage under their state Medicaid programs for a variety of different services and include payment parity provisions for telehealth services; and/or (2) prohibit commercial health insurers from imposing additional requirements on the use of telemedicine services or requiring in-person exams to be conducted before future telemedicine treatments.
Major challenges to broadscale adoption and use of telehealth services still remain on the horizon – including challenges related to scalability and compatibility to share information across various telecommunication technologies, platforms and networks. But in an industry frequently beset by an inability to adapt due to the diverse interests of payors, patients, providers and policymakers, these stakeholders seem more willing than ever to work together and realize the benefits of telehealth services. The path forward for telehealth has been forever transformed.
Charles Dunham, a shareholder at Greenberg Traurig, LLP, advises health care providers and other businesses in regulatory, corporate, transactional, reimbursement, compliance and white-collar defense matters. He represents an array of health care providers, suppliers and other health-related entities with a distinct focus on the clinical laboratory and telehealth industries.
Ben Nipper, an associate at Greenberg Traurig, LLP, focuses his practice on telehealth and fraud and abuse matters.