Expansion of Medicare Coverage and Payment for Telehealth Services
On March 6, 2020, Congress passed new legislation providing emergency funding for federal agencies to respond to the COVID-19 outbreak and including an expansion of Medicare coverage for telehealth services. The new law provides authority for the Secretary of the Health and Human Services (HHS) to waive certain Medicare telehealth payment requirements during the public health emergency declared by the Secretary of HHS on January 31, 2020.
Traditionally, the Centers for Medicare and Medicaid Services (CMS) has prohibited reimbursement for telehealth services provided to a Medicare beneficiary at home, except for “virtual check-ins.” Other covered telehealth services under current Medicare policy include remote monitoring services, physician interpretation of diagnostic tests, and other non-face-to-face care management, each of which may be billed as if the service was furnished in-person.
Now, Medicare originating site and geographic requirements are waived under the new law, allowing telehealth services to be provided regardless of where the beneficiary is located, including their residence. To qualify for the waiver, the telehealth provider must have furnished services to the patient within the previous three years or be in the same practice (i.e., as determined by tax identification number) of a practitioner who has treated the patient in the past three years. However, HHS has announced that it will not conduct audits to ensure that such a prior relationship existed for claims submitted during this public health emergency. All services currently eligible under the Medicare telehealth reimbursement policies are included in this waiver (e.g., office visits, psychotherapy, and consultations). The waiver, which is expected to be effective until the end of the public health emergency as declared by the Secretary of HHS, does not expand the list of eligible providers or the modalities that can be used to provide telehealth services.
Additional guidance on Medicare coverage and payment of telehealth services is available at cms.gov/medicare and CMS FAQs may be found at cms.gov/faqs.
OIG Permits Physicians to Reduce or Waive Cost-Sharing for Telehealth Services
The HHS Office of Inspector General (OIG) issued a policy statement permitting physicians and other practitioners to reduce or waive cost-sharing obligations, including coinsurance and deductibles, for telehealth services paid for by federal healthcare programs. Ordinarily, reductions or waivers of costs owed by federal health care program beneficiaries may implicate the federal anti-kickback statute.1 By contrast, OIG indicated in this policy statement that the agency will not subject physicians and other practitioners to OIG administrative sanctions for such reductions or waivers of cost-sharing obligations, particularly in light of increased demand for telehealth services resulting from the COVID-19 outbreak.
Relaxation of HIPAA Enforcement and Requirements
HHS' Office for Civil Rights (OCR) advised covered health care providers that they may now use any non-public facing remote audio or video communications platform (e.g., Apple FaceTime, Google Hangouts, Skype) to deliver telehealth services. OCR’s decision not to impose penalties for the use of such communication platforms does not extend to public facing platforms such as Facebook Live, Twitch, and TikTok. OCR recommends that providers enable all possible encryption and privacy modes when utilizing the permissible platforms and to advise patients of the potential privacy risks.
OCR's decision applies to telehealth services provided for any reason, not just services related to the diagnosis and treatment of COVID-19. Further, OCR advised that it will not impose penalties against covered health care providers who use a video communication vendor without first signing a business associate agreement, a requirement that is typically mandated under HIPAA.
In a separate announcement, OCR released guidance detailing its intention to relax Health Insurance Portability and Accountability Act (HIPAA) enforcement against covered entities utilizing telehealth to cope with the national emergency created by the COVID-19 outbreak. Specifically, OCR announced that it will "exercise its enforcement discretion" and "will not impose penalties for noncompliance" with HIPAA's regulatory requirements in connection with the "good faith provision of telehealth."
Additional guidance on HIPAA requirements during a public health emergency is available on reedsmith.com.
Medicaid Guidance
CMS also issued Medicaid-specific guidance to assist state Medicaid agencies with understanding their options for covering and paying for telehealth services. As detailed in this guidance, states are not required to submit a state plan amendment to pay for telehealth services if payment will be made in the same manner as if the service was furnished in person. Practitioners must continue to practice within the guidelines of their scope of practice. States may pay a qualified practitioner at the distant site (the billing provider), and the state's payment methodology may include costs associated with the time and resources spent facilitating care at the originating site.
States are also permitted to pay for appropriate ancillary costs, such as technical support, transmission charges, and necessary equipment, according to approved state payment plan methodologies. Ancillary costs associated with the originating site for telehealth may either be incorporated into the fee-for-service rates or separately reimbursed as an administrative cost. Telehealth providers should check with the relevant state Medicaid program to confirm what policy changes have been adopted in a particular state.
State Law Considerations
Under its Section 1135 authority, CMS has waived certain billing rules requiring practitioners to be licensed in the state in which they practice, so long as they are licensed in another state. The waiver eases the way for providers to be reimbursed for the performance of telehealth services. However, providers should continue to be mindful of state law restrictions. Although certain states are undertaking their own independent efforts to promote telehealth access at a localized level, providers should remain mindful of state laws regulating telehealth delivery, including issues concerning professional licensure, scope of practice, standard of care, and patient consent. As exemplified by steps taken by Massachusetts identified in the section below, many states have moved to mandate or encourage payment parity between services delivered in-person and via telehealth. Nonetheless, in the absence of explicit authority indicating otherwise, providers should expect that standard state laws and regulations still apply. Providers should remain vigilant of such requirements and any related developments at the state level.
Commercial Payors Take Steps to Expand Members' Access to Telehealth Services
An increasing number of commercial payors are waiving fees or lessening out-of-pocket costs for telehealth services to expand access for their members in the midst of the COVID-19 outbreak. One major commercial payor, for example, announced that it will waive out-of-pocket costs through May 31, 2020 for COVID-19 related testing by in-network providers, whether in-person or via telehealth. Other large payors have announced their waiver of telehealth visit copayments, including the offering of zero co-pay telemedicine visits for any reason to all Individual and Group Medicare Advantage members until further notice. Additionally, certain states have mandated that commercial payors take action to expand telehealth coverage. In Massachusetts, for example, Governor Charlie Baker has ordered all commercial payors in the state to permit all in-network providers to deliver medically necessary covered services to members via telehealth and has prevented payors from reimbursing telehealth services at a lower rate.
Additional Legislation May Be Forthcoming
As we draft this summary, the United States Senate is working on additional legislation that includes telehealth and other health policy provisions. Similarly, many state legislatures and boards of medicine are considering additional changes to policy in order to foster telehealth services.
Contact Us
For more information on this issue, please contact any of the authors.
In addition, our broader Reed Smith Coronavirus team includes multidisciplinary lawyers from Asia, EME and the United States who stand ready to advise you on the issues above or others you many face related to COVID-19.
For more information on the legal and business implications of COVID-19, visit the Reed Smith Coronavirus (COVID-19) Resource Center or contact us at COVID-19@reedsmith.com.
- 42 U.S.C., Section 1320a-7b(b).
Client Alert 2020-147
