Health Law Blog - Healthcare Legal Issues

Reimbursement for Telemedicine and Telehealth Services

Reimbursement Rules for Telemedicine Slow to Develop

The absence of consistent, comprehensive reimbursement policies has historically been one of the most serious obstacles to the development of telemedicine.  Without uniformity in reimbursement it is much more difficult for providers to develop economically self-sustaining telemedicine programs.  If reimbursement is inconsistent, providers must look to other factors, such as enhancement of efficiencies, to justify the development of new telemedicine technologies.  We are beginning to see changes in state and federal reimbursement for telehealth services, but changes are coming slowly.

All health care reimbursement policy is disjointed between a variety of federal agencies, state governments, and various types of private health care payors.  Reimbursement policies play an important role in determining the rate which new modes of providing care can develop.  CMS policy often sets some of the general rules that other payors look to when setting their reimbursement policies.  Unfortunately, in the area of telehealth coverage, CMS has not taken a progressive approach to developing a reimbursement policy.  Some progress has been made toward expanding Medicare coverage.  Yet, Medicare coverage is still severely limited and is only (with very few exceptions) available to patients that are located in specific rural areas.

Many state Medicaid programs, including Wisconsin’s Badger Care Program, provide more expansive coverage of services that are provided using telemedicine technologies.  Other states have more restrictive coverage.  Private insurance policies vary widely.  Some states have passed laws that mandate telemedicine coverage.  Even of the states that have passed mandatory laws, the nature and scope of the mandate differ widely.

Unfortunately, this inconsistency and unpredictability in reimbursement serves as an impediment to development in telemedicine.  Even when a telemedicine program is developed, reimbursement inconsistencies increase administrative burdens involved with billing for services.  The inconsistencies also necessarily increase compliance risk if the provider is not up to date and accurate as to the reimbursement rules that are applicable.

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John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
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