October 23, 2018

CMS Proposes to Expand Telehealth Reimbursement under Medicare

Jeremy Sherer and Amy Joseph, Hooper Lundy, & Bookman, PC Boston, MA and David Vernon, Hooper Lundy, & Bookman, PC, Washington, DC

While many state Medicaid programs and commercial payors across the country are covering services delivered via telehealth (albeit to varying degrees), obtaining Medicare reimbursement for such services remains a significant challenge to the telehealth industry.  Historically, Medicare has covered certain enumerated telehealth services provided from approved originating sites, such as hospitals and other healthcare provider facilities, to beneficiaries located in rural areas.1 Throughout 2018, however, the Centers for Medicare & Medicaid Services (CMS) has issued a number of proposed rules that suggest its perspective on the role of telehealth is evolving. 

This article focuses on two such proposed rules, the 2019 Physician Fee Schedule Proposed Rule and the 2019 Home Health Prospective Payment System Proposed Rule.  In both instances, CMS proposes to cover a number of services that are colloquially considered within the scope of telehealth services by excluding them from “Medicare telehealth services,” thereby circumventing Medicare’s restrictive telehealth reimbursement standards.

2019 Physician Fee Schedule Proposed Rule

On July 12, 2018, CMS issued the 2019 Physician Fee Schedule (PFS) Proposed Rule (Proposed Rule).  In it, CMS proposes a significant and novel change with regard to Medicare reimbursement for telehealth-type services.  If adopted, the proposal would distinguish “communication technology-based and remote evaluation services” from “Medicare telehealth services,” allowing Medicare to reimburse certain telehealth-like services even though they do not satisfy statutory requirements for “Medicare telehealth services.” 

In its commentary, CMS recognizes that technology and its uses have evolved since the Medicare Act was amended to provide coverage for certain telehealth services furnished to patients in specified rural areas and health facilities (originating site and geographic restrictions). CMS specifically acknowledges that these restrictive statutory provisions “may have been limiting the degree to which the medical community developed coding for new kinds of services that inherently utilize communication technology,”2 but concludes that it lacks the authority to change the originating site, geographic and other restrictions for telehealth coverage.3  Instead, CMS responds to these issues by advancing the view that these restrictive reimbursement standards do not necessarily apply to services that “inherently involve the use of communication technology.”  In particular, CMS states:

We have come to believe that section 1834(m) of the Act does not apply to all kinds of physicians’ services whereby a medical professional interacts with a patient via remote communication technology.  Instead, we believe that section 1834(m) of the Act applies to a discrete set of physicians’ services that ordinarily involve, and are defined, coded, and paid for as if they were furnished during an in-person encounter between a patient and a health care professional.

For CY [Calendar Year] 2019, we are aiming to increase access for Medicare beneficiaries to physicians’ services that are routinely furnished via communication technology by clearly recognizing a discrete set of services that are defined by and inherently involve the use of communication technology.4

CMS proposes three “communication technology-based and remote services” that would be reimbursable under Medicare.5  Although these services do not qualify as “Medicare telehealth services,” they are colloquially referred to as telehealth services and would be covered by Medicare if the Proposed Rule is finalized.  The following is a summary of the three proposed communication technology-based and remote services, along with CMS’ other telehealth proposals involving coverage for prolonged preventive care telehealth services, monthly dialysis telehealth assessments, and acute telestroke services.

These proposed changes may signal additional flexibility around technology-enabled services and increased recognition of the value that they can add, including earlier and more cost-effective intervention that could in some cases eliminate the need for an in-person visit.  However, even with the proposed changes, Medicare would still have significantly more restrictive reimbursement standards than many other government and private payors.  If finalized, these proposed changes would take effect on January 1, 2019.  

New Communication Technology-Based and Remote Evaluation Services

a. Virtual Check-ins (HCPCS Code GVCI1)

In the Proposed Rule, CMS proposes to cover “brief check-in services furnished using communication technology that are used to evaluate whether or not an office visit or other service is warranted.”6   While such services furnished before or after an office visit are typically bundled into the payment for the related visit, CMS has proposed to establish a separate payment to physicians who provide a “virtual check-in” to a patient who subsequently does not seek an office visit.

CMS is soliciting comments on whether audio-only interaction (i.e., telephone), as opposed to a live, two-way, audio-video interaction, is clinically appropriate for “virtual check-ins.”  CMS also noted that this “could be used as part of a treatment regimen for opioid use disorders and other substance use disorders, since there are several components of Medication Assisted Therapy (MAT) that could be done virtually, or to assess whether the patient’s condition requires an office visit.”7 CMS emphasized the importance of obtaining a patient’s consent to receive a “virtual check-in,” and has proposed that this service only be available when the interaction is between a clinician and a patient that have an existing relationship.  For the latter requirement, CMS explains that “basic knowledge of the patient’s medical condition and needs” is required to provide a “virtual check-in.”8

If the Proposed Rule is finalized, “virtual check-ins” could be provided to patients regardless of their location. 

    b. Remote Evaluation of Pre-Recorded Patient Information (“Store and Forward” Services) (HCPCS Code GRAS1)

CMS has proposed to reimburse providers for evaluating pre-recorded, patient-created videos or images, regardless of the patient’s location.9  Commonly known as “store and forward” services, this would allow patients to transmit a picture or a video capturing their symptoms to a clinician who could review the data and determine an appropriate course of treatment. 

Like the “virtual check-ins” described above, CMS appears to envision store and forward services being utilized by clinicians to help their patients determine whether or not an office visit is warranted.  Also like “virtual check-ins,” when provided before or after an office visit, payment for these services would be bundled into the payment for that visit, so long as the store and forward services are provided within seven days of the office visit at issue, except when the result of the store and forward consult is that the patient does not seek an office visit, in which case the provider would receive a separate payment. CMS also stated that it is open to allowing for such services to be provided by physicians to non-established patients, particularly in practice areas such as dermatology or ophthalmology, where it may be clinically appropriate to make a determination as to whether an office visit is needed utilizing store and forward communications.

    c. Interprofessional Consultations (CPT Codes 994X6, 994XO, 99446 – 49)

CMS is proposing to pay for “interprofessional consultations undertaken for the benefit of treating a patient” among medical professionals utilizing communications technology such as telephone or the Internet.10  In other words, this proposal is meant to address consultations between professionals with respect to a particular beneficiary.  CMS views this proposal as consistent with its “ongoing efforts to recognize and reflect medical practices trends in primary care and patient-centered care management within the PFS” through which CMS is updating its reimbursement standards to reflect the value of more integrated care. CMS specifically noted that this approach is useful when managing patients’ chronic conditions, such as heart disease, diabetes, respiratory disease, breast cancer, allergies, Alzheimer’s disease, and factors associated with obesity.  This component of the Proposed Rule reflects a concern that current reimbursement standards do not “adequately reflect the changes that have occurred in medical practice, and the activities and resource costs associated with the treatment of these complex patients in the primary care setting.”11

CMS is proposing to make separate payments for these services because it believes they “describe resource costs directly associated with seeking a consultation for the benefit of the beneficiary.”  Because these consultative services are provided without the beneficiary being physically present, CMS is proposing to require the treating practitioner to obtain the beneficiary’s verbal consent in advance of the services, which consent would be documented by the practitioner in the patient’s medical record.  CMS believes that separate payment for these services “will contribute to payment accuracy for primary care and care management services,” but also expressed concern about distinguishing between payable interprofessional consultations for the benefit of the patient and nonpayable consultations for the benefit of the practitioner, and the potential program integrity concerns associated with these consultations.  CMS has expressly requested comment on these issues and potential controls or limitations that could be implemented to address them.12

If implemented, this change would be consistent with the approach of most states that have created consultation exceptions to their telemedicine practice standards.13

2. Addition of Medicare Telehealth Coverage for Prolonged Preventive Services (HCPCS Codes G0513 & G0514)

While CMS states that it does not have the authority to change or limit the conditions that must be met for reimbursement of “Medicare telehealth services,” including originating site restrictions and geographic requirements, CMS does have the authority to add or delete services from the enumerated list of telehealth services that are covered when such requirements are met. In the Proposed Rule, CMS is proposing to add two HCPCS codes to the list of “Medicare telehealth services.”

HCPCS codes G0513 and G0514 allow providers to obtain reimbursement for “prolonged preventive services beyond the typical service time of the primary procedure,”  meaning services provided in the 30 minutes beyond the typical time in the physician’s office or other outpatient setting, as applicable, where direct patient contact beyond the primary procedure would be required.14  CMS noted that it views these services as “sufficiently similar to office visits currently on the telehealth list.”  If this proposal is finalized, these prolonged preventive services provided via telehealth would need to be offered to a patient located at a qualifying site (e.g., a physician’s office, a hospital, a rural health clinic, a skilled nursing facility) in a health professional shortage area (HPSA) or Metropolitan Statistical Area (MSA) in order to be covered as Medicare telehealth services.  In other words, these services would be covered when provided via telehealth as long as they meet Medicare’s reimbursement requirements for Medicare telehealth services.

3. Originating Site and Geographic Requirement Exceptions for ESRD, Telestroke

In the Proposed Rule, CMS outlines several proposed regulatory changes related to originating site and geographic requirements to implement sections of the Bipartisan Budget Act of 2018 (Act).15

With respect to end stage renal disease (ESRD) the Act requires that patients receiving home dialysis may choose to receive monthly clinical assessments via telehealth, and that renal dialysis facilities and the patient’s home be added to the list of acceptable originating sites from which patients can receive such services.  To reflect this change, CMS proposes to modify its current originating site restrictions to add renal dialysis facilities and the patient’s home to the list of acceptable telehealth originating sites from which patients can receive monthly dialysis assessments.  CMS is also proposing to eliminate geographic requirements where treatment is delivered from an originating site that is a hospital-based or critical access hospital-based renal dialysis center, renal dialysis facility, or the patient’s home.

CMS also proposes to add mobile stroke units as permissible originating sites for acute stroke telehealth services.  To implement those requirements, CMS proposes creating a new billing modifier to identify acute stroke telehealth services, which would be used to indicate that codes billed were used to furnish telehealth services for diagnosis, evaluation, or treatment of symptoms of an acute stroke. 

2019 Proposed Changes to the Home Health Prospective Payment System

On July 2, 2018, CMS issued a proposed rule that would introduce changes to the Home Health Prospective Payment System, including by incentivizing the use of remote patient monitoring (RPM) in augmenting home health services.16  RPM is not considered a Medicare telehealth service, but rather uses digital technology to collect health data from a patient in one location and transmit that data to a provider located elsewhere to analyze and determine a course of treatment.  Medicare has covered RPM since January 2018,17 which CMS defines as the collection and interpretation of “physiologic data (e.g., ECG, blood pressure, glucose monitoring) digitally stored and/or transmitted by the patient and/or caregiver to the physician or other qualified health care professional, qualified by education, training, licensure/regulation (when applicable) requiring a minimum of 30 minutes of time.”18  RPM can enable patients to monitor and measure their own clinical data, such as heart rate, weight and blood pressure, and communicate such data to a practitioner without any direct interaction between the patient and his/her practitioner.

RPM is billed under CPT code 99091.  CPT code 99091 is paid under the Medicare physician fee schedule, and thus cannot be billed by home health agencies (HHAs).19  While RPM is not separately billable under the Home Health Prospective Payment System and “may not be used as a substitute for in-person home health services,” CMS notes that there is nothing precluding HHAs from utilizing RPM to “augment the care planning process as appropriate.”20  As such, CMS has proposed to modify Medicare regulations to enable HHAs, if using RPM to augment the care planning process, to report the costs of RPM on their cost reports as allowable administrative costs.21  In doing so, these costs will be factored into the costs per visit, which in turn will impact Medicare margin calculations.

CMS’s press release on the proposed rule observed, “studies show that remote patient monitoring has a positive impact on patients as it allows patients to share more live-time data with their providers and caregivers, which will lead to more tailored care and better health outcomes.”22  By allowing RPM as an administrative cost on the HHA cost report, CMS believes that it will encourage more HHAs to utilize this technology.  While uncertain that the proposal will be implemented, CMS’s apparent desire to enable HHAs to utilize RPM further underscores the Agency’s evolving views on digital health technology.   If this proposed rule is finalized, the changes it introduces will go into effect January 1, 2019.

Conclusion

Medicare reimbursement remains a source of frustration for telemedicine advocates in 2018.  However, as the developments discussed above demonstrate, CMS’s perspectives on telehealth appear to be evolving.  Healthcare attorneys should continue to monitor developments in this space closely.

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Amy M. Joseph, Esq., is a senior counsel in the Boston, MA offices of Hooper, Lundy & Bookman, P.C.  Ms. Joseph advises a wide variety of healthcare providers on business and regulatory matters.  A significant portion of her practice is focused on fraud and abuse compliance, including counseling and advice regarding compliance of potential business structures with federal and state anti-kickback and self-referral laws, health information privacy and security, and mergers and acquisitions and other strategic affiliations.  Ms. Joseph also has a Certification in Healthcare Research Compliance.  She may be reached at ajoseph@health-law.com.

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David J. Vernon, Esq. is an associate in Hooper, Lundy & Bookman’s regulatory department in Washington, DC, where he assists healthcare providers, including hospitals, skilled nursing facilities, and physicians with a broad range of licensing and certification, reimbursement, fraud and abuse, and compliance issues.  He focuses his practice on Medicare and Medicaid reimbursement, especially on Graduate Medical Education reimbursement, and on licensing and certification.  Mr. Vernon is a co-founder of the firm’s Academic Medical Center/Teaching Hospitals Working Group and a member of the firm's Fraud & Abuse Practice Group.  He may be reached at dvernon@health-law.com.

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Jeremy D. Sherer, Esq. is an associate in Hooper, Lundy & Bookman’s Boston office.  His practice focuses on digital health and telemedicine, as well as fraud and abuse compliance and accountable care/hospital-physician integration. Mr. Sherer has experience advising hospitals, telemedicine services providers, physician practices and others on telemedicine matters involving reimbursement (Medicare, Medicaid and commercial), fraud and abuse, scope of practice issues, licensing, contracting, the corporate practice of medicine, proxy credentialing, e-prescribing, privacy, and health information security.  He also advises clients on matters involving federal and state fraud and abuse laws.  He may be reached at jsherer@health-law.com.

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1

42 U.S.C. §1395m(m).

2

See id.

3

Such changes would need to be implemented by Congress via legislation.

4

83 Fed. Reg. 35723 (July 27, 2018).

5

Id.

6

83 Fed. Reg. 35723 (July 27, 2018).

7

83 Fed. Reg. 35724.

8

Id.

9

Id.

10

83 Fed. Reg. 35725.

11

Id.

12

83 Fed. Reg. 35726.

13

See, e.g., American Telemedicine Association, “State Telemedicine Gaps Analysis: Physician Practice Standards and Licensure,” available at https://utn.org/resources/downloads/50-state-telemedicine-gaps-analysis-physician-practice-standards-licensure.pdf.

14

83 Fed. Reg. 35726.

15

Bipartisan Budget Act of 2018, P.L. 115-123.

16

83 Fed. Reg. 32340 (July 2, 2018, while the official copy was published in the Federal Register July 12th.) 

17

82 Fed. Reg. 52976 (Nov. 15, 2017).

18

82 Fed. Reg. 53014.

19

CMS is considering introducing three new CPT codes for RPM technology in January    2019: 990X0, 990X1 and 994X9.

20

83 Fed. Reg. 32425.

21

These regulatory changes, if enacted would modify 42 C.F.R. § 409.46.

22 Id.
23 Connecticut Substance Abuse Treatment Provider Pays $627K to Settle False Claims Act Allegations, https://www.justice.gov/usao-ct/pr/connecticut-substance-abuse-treatment-provider-pays-627k-settle-false-claims-act.
24 Id.
25

Medicare Advantage Organization and Former Chief Operating Officer to Pay $32.5 Million to Settle False Claims Act Allegations, https://www.justice.gov/opa/pr/medicare-advantage-organization-and-former-chief-operating-officer-pay-325-million-settle.

26

Miami Man Sentenced to More than Eight Years in Prison for Role in $10 Million Health Care Fraud Scheme, https://www.justice.gov/opa/pr/miami-man-sentenced-more-eight-years-prison-role-10-million-health-care-fraud-scheme.

27

Supra note 25; supra note 5, at p. 21.

28 Id.
29

Id. The OIG refers to the Department of Health and Human Services’ Office of Inspector General.

30

U.S. ex rel. Poehling v. UnitedHealth Group, Inc., No. 16-cv-08697 (C.D. Cal.).

31

United States ex rel. Poehling v. UnitedHealth Grp., Inc., No. CV1608697MWFSSX, 2018 WL 1363487, at *10(C.D. Cal. Feb. 12, 2018).

32

For Example, in January 2018, the Office of Inspector General (OIG) added a study entitled “Financial Impact of Health Risk Assessments and Chart Reviews on Risk Scores in Medicare Advantage” to its work plan.  https://oig.hhs.gov/reports-and-publications/workplan/summary/wp-summary-0000268.asp.

33

OIG Adds Telehealth Audits to Work Plan, https://mcdonaldhopkins.com/Insights/Alerts/2017/12/06/OIG-adds-telehealth-audits-to-work-plan; CMS Paid Practitioners for Telehealth Services That Did Not Meet Medicare Requirements, https://oig.hhs.gov/oas/reports/region5/51600058.asp.