Most states have laws supporting telehealth reimbursement

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The march toward wider acceptance of telemedicine is continuing, prodded along by activities by individual states that require private insurance plans to cover the virtual services.

A total of 34 states now have laws on the books requiring insurance plans to cover telehealth services. Most recently, governors in Oklahoma and Texas have signed laws requiring payment for some telemedicine services.

That’s an encouraging trend for the distance care industry, which for years struggled against barriers imposed by state and federal regulations that restricted reimbursement.

In general, recent telemedicine legislation requires private insurers to offer reimbursement for physician services provided via telemedicine, similar to the way they pay for in-person physician services, says Gary Capistrant, chief policy officer at the American Telemedicine Association.

Still, challenges remain for the industry, because the new laws governing telemedicine vary from state to state, Capistrant notes.

For example, Oklahoma this year enacted a law to establish new practice standards for telemedicine that now enable physicians to create a doctor-patient relationship without first having an in-person examination, says Thomas Ferrante, a health law attorney and chair of the telemedicine team at the Foley & Lardner law firm.

Similarly, the new Texas legislation allows physicians to use videoconferencing to see patients without requiring a prior in-person interaction.

However, the Texas law sets rules on the physical distance between the provider and patient and does not specify methods of delivery or additional records requirements. By contrast, the Oklahoma law defines telemedicine as two-way, real-time interactive communication and imposes specific requirements on access to patient medical records prior to the telemedicine visit.

However, Capistrant and others note that state laws vary, and what’s more challenging is that Medicare and Medicaid—the largest payers in the nation—have lagged behind private insurers in reducing burdens to the use of telemedicine.

Medicare, for instance, generally only covers telehealth services in rural areas, thus limiting telemedicine availability to only about one-fifth of Medicare beneficiaries, and the services must be done in person, meaning patients need to travel.

Medicare also does not cover hospice services in the home, although it is unrealistic to expect many hospice patients to get in the car and go see a doctor, Capistrant contends. “But with telehealth technology, we can bring the provider to the patient.”

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Medicaid, in general, does not cover telehealth services in the home, according to Capistrant. A patient can go to a community health center or other facility that supports remote consultation with a specialist, but that means patients must travel. “A lot of people can’t travel that distance or travel at all,” he adds.

Further, mental health patients often do better with telehealth consultations if they are allowed to have a remote session with a therapist in their homes, Capistrant explains. “They are reluctant to travel and sit in an office and open up. People with severe depression won’t get out of bed, much less out in the community.”

States could lift telemedicine barriers by changing existing policies, Capistrant believes. Telehealth licensing in large part remains a state-by-state issue for communities located near state borders, affecting providers, patients, employers and multi-state health plans. However, some states have reciprocal agreements with one or more neighboring states to enable physicians with patients in more than one state to conduct telehealth sessions in each participating state.

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