A Look at the Future of Telehealth from a Medicare Reimbursement Perspective

We’ve all been watching the explosion of telehealth thanks to COVID-19 and a number of the reimbursement changes that have come as part of the pandemic.  While we’re all waiting to see if these telehealth reimbursement changes are permanent (Looks like Telehealth reimbursement may even be included in the Heroes Act and extended through the end of 2021), it was great to get some perspectives on what we can expect from a government affairs perspective at a recent HIMSS Telehealth Press event.

At the event, Tom Leary, VP Government Affairs at HIMSS, offered an insight into why telehealth reimbursement has been held back in the past that I hadn’t heard before:

For many years the big struggle from a Medicare perspective is that the CBO has said that introducing widespread telehealth is going to have an increase in cost for patients that might not have gone to the doctor very often but now they have great access and therefore it’s going to have an impact for the Medicare program.

Leary then went on to share that the previous community response to this was to look at the VA data or various individual health systems that had adopted telehealth more broadly to verify if this was something to be concerned about or not, but that never resonated with the CBO or Medicare.  At least it didn’t resonate enough for them to change their evaluation of telehealth reimbursement not driving more visits which would increase Medicare costs.  Leary described that Medicare would say that they didn’t have enough data on Medicare patients to really evaluate it.  However, Leary suggested things might be different now:

I’m anticipating that since there were 1.3 or 1.7 million Medicare patients in April, that’s plenty enough data now for CBO to be able to really, truly understand the positive access impact as well as the potential cost savings or cost drivers.

Of course, if the Heroes Act mentioned above really does extend telehealth reimbursement through the end of 2021, Medicare will have even more data to make this assessment and understand what impact telehealth has on potential costs savings and cost drivers.

During the press call, Domenic Segalla, Principal, Healthcare Advisory Services at Withum, offered a separate perspective on the future of telehealth from a health system perspective.

The one thing that is clear from all of the providers and health systems we work with is, they do not believe that they can go back. Hopefully the digital health era is here to stay, but from a patient standpoint and the ease of the virtual care that they’re receiving and some of the fear of going back in for E&M type of visits, they believe this has to stay in tact.

Is this the perspective of health systems?  I’d be interested to hear what you think in the comments.

No doubt there is still going to be an ongoing fear for many patients when it comes to going back in for an office visit.  Even before COVID-19 many patients had this fear, so it won’t be a surprise if this fear persists and drives many patients to demand a telehealth option.  However, if reimbursement for telehealth visits doesn’t keep up, will those demands fall on deaf ears?

Segalla also offered this important perspective on what CMS will use to evaluate the future of telehealth reimbursement:

Clearly from Medicare’s side and from CMS’s standpoint, they’re looking at, “Will it improve the health outcomes?” and “Will it reduce the overall healthcare spend?” And I think that’s more to come on that. Is it a 1 for 1 on this type of virtual care as that patient would have come in and physically seen the physician. More to come on that, but clearly CMS is not going to want to increase their spend. So, I think this is something that they’re really going to dig into. A to see what the current rate will be going forward and what the impact on outcomes and healthcare spend will be.

I think he’s right that Medicare is going to want to really evaluate the results of telehealth before finalizing decisions on telehealth reimbursement.  However, now they have the data and should be able to do that analysis.  My only fear is that this analysis won’t take into account things like the convenience for the patient.  It’s hard to put a number on that value.

Needless to say this is a fluid situation and likely will be for the next year or longer.  However, there are definitely promising signs that telehealth from a Medicare perspective is here to stay.  Will that be enough to ensure health systems and doctors continue telehealth?  I think there are more variables to the telehealth value equation than just Medicare reimbursement.  However, it would be a big step in the right direction.

This article is part of the #HealthIT100in100

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About the author

John Lynn

John Lynn

John Lynn is the Founder of HealthcareScene.com, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference, EXPO.health, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.