November 26, 2022

Volume XII, Number 330


November 23, 2022

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CMS-Supported Telehealth Will Continue To Be A Driving Force – But Watch for Greater OIG Enforcement

As mindsets pivoted to a post-pandemic life, telehealth advocates petitioned CMS to embrace telehealth as a permanent care option, and CMS responded with regulatory action at the end of 2021.

During the Covid-19 Pandemic, telehealth usage surged as patients and providers turned to it as a safer care alternative. McKinsey estimated telehealth claim volumes reached 80 times pre-pandemic levels at its peak, ultimately stabilizing at 38 times pre-pandemic levels by early 2021.1 This increase was mostly driven by CMS’ waivers and relaxation of regulatory constraints for telehealth reimbursement. But, the temporary nature of both left questions regarding telehealth’s future.

In December 2021, CMS issued new regulations which, collectively, steer telehealth toward becoming a part of the telebehavioral health toolkit accepted by Medicare post-pandemic. In the CY2021 Physician Fee Schedule Final Rule2 , further discussed here, CMS broadly expanded access to telebehavioral health services. Specifically, Medicare permanently authorized payment for telehealth services furnished “for purposes of diagnosis, evaluation or treatment of a mental health disorder” under the following relaxed criteria:3

  • First, CMS made the patient’s home4 a qualifying originating site for telehealth encounters done for diagnosis, evaluation or treatment of a mental health disorder, provided that such services were preceded and followed by a qualifying inperson visit

  • Second, CMS waived geographic restrictions on Medicare’s payment for such services.5 Now, a patient’s home may serve as an originating site for telebehavioral services, even when the home isn’t in a qualifying rural zip code.

  • Third, CMS permanently allowed audioonly visits for the evaluation and treatment of mental health disorders when: (1) the patient’s home is the originating site, and (2) the telehealth provider has audio-visual technical capabilities for the encounter, but the patient either is incapable of having or refuses to consent to a video encounter.6 (For services other than behavioral health counseling services, CMS is still refusing to pay for audio-only encounters.7)

Collectively, these changes are likely to significantly broaden access to behavioral health care for Medicare beneficiaries facing increased challenges accessing care. However, at the same time, one can also expect increased scrutiny and enforcement action from the Office of Inspector General (“OIG”) to prevent fraud, waste and abuse in telehealth. The Department of Justice and OIG have already increased anti-fraud enforcement measures in the telehealth industry over the past few years, and this is likely to continue as telehealth becomes a permanent part of behavioral health services. As recently as September 2021, the OIG specifically evaluated telehealth’s use in providing behavioral health services to Medicaid enrollees.8 In its report9 , the OIG acknowledged telehealth’s value during the pandemic, but also highlighted the importance of (i) ensuring payers can distinguish between telehealth and inperson services; (ii) evaluating the effects of telehealth on access, cost, and quality of behavioral health services; and (iii) ongoing monitoring for fraud, waste, and abuse.

Based on these comments, providers should consider acting defensively in building out telebehavioral health services and adopt processes supportive of quality, robust documentation, and furthering the Triple Aims10 of improving the patient care experience (including quality and satisfaction); improving the health of populations; and reducing the per capita cost of health care.


1 See Oleg Bestsenney et. al, Telehealth: A Quarter-Trillion Dollar Post-Covid-19 Reality? (Updated July 9, 2021) available at: healthcare-systems-and-services/our-insights/telehealth-a-quarter-trillion-dollar-post-covid-19-reality.

2 86 Fed. Reg. 64996 (Nov. 19, 2021) available here

³Telehealth services must meet the conditions in 42 C.F.R. §414.65 and §410.78, as well as state requirements, to lawfully seek Medicare reimbursement.

4 A patient’s “home” may include their residence, a temporary residence (e.g. hotel, shelter), or a nearby location where the patient goes for privacy or other reasons.

5 86 Fed. Reg. 65057 (Nov. 19, 2021) (CMS noted a patient’s home does not need have to be located in a qualifying location provided by 41 C.F.R. §410.78(b)(4) (i.e. a rural health professional shortage area)).

6 86 Fed. Reg. 65057 (Nov. 19, 2021).

7 CMS justified limiting phone-only consultations to mental health services primarily involving verbal conversation between the patient and provider by noting that visualization of the patient is less necessary for such services, but important for others.

8 See Opportunities Exist To Strengthen Evaluation and Oversight of Telehealth for Behavioral Health in Medicaid (OEI-2-19-00401) (Sept. 20, 2021) available at

9 Id.

10 See The IHI Triple Aim, Institute for Health Improvement, available at

© Polsinelli PC, Polsinelli LLP in CaliforniaNational Law Review, Volume XII, Number 62

About this Author

Laura Little, Polsinelli PC, Stark Compliance lawyer, anti kickback statute Attorney

Drawing on her business, policy, and legal background, Laura Little assists clients in navigating the ever-changing regulatory health care landscape. Laura’s practice centers on representing physicians, hospitals and health systems, and health care technology corporations in a variety of regulatory and transactional matters, including: 

  • Hospital-physician relationships 

  • Health care mergers and acquisitions 

  • Medicare and Medicaid reimbursement 

  • ...
Lori Oliver Health Care Lawyer Polsinelli Law Firm

Lori Oliver’s practice focuses on a wide array of health care regulatory, transactional and operational matters. Her deep bench of experience and in-depth understanding of the health care industry enables Lori to offer practical solutions and strategic advice to clients. As a former health care executive, she has significant health care operational experience to draw upon. She has experience in health care alignments and relationship strategies, clinically integrated networks, health care operations and complex compliance matters, including fraud and abuse, Stark, HIPAA and state privacy...

Jessica Andrade Commercial Litigation Lawyer Polsinelli Law Firm

Jessica is a commercial litigator and investigations attorney with Polsinelli, where she is chiefly associated with the firm’s Government Investigations practice group.  Jessica has significant experience defending clients facing government investigations and enforcement proceedings, as well as in False Claims Act, Anti-Kickback, and Stark litigation.  This experience includes working with clients in both the healthcare and government contracting industries.  In addition, Jessica provides compliance advice to help clients avoid government inquiries.

Jessica has significant complex...