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Senate Finance Committee Considering Telehealth Options to Improve Care and Lower Costs

On December 18, 2015, the United States Senate Committee on Finance (the Committee) released a Bipartisan Chronic Care Working Group Policy Options Document (available at http://src.bna.com/bEV) (the Policy Document), which outlines approaches under consideration to improve the care and treatment of Medicare beneficiaries with multiple chronic diseases.  Significantly, the Policy Document contemplates a number of changes that could expand the use of telehealth strategies to address the needs of Medicare beneficiaries with chronic conditions.  In doing so, the Policy Document directly asks the question of whether telehealth strategies can help to improve quality, reduce costs and increase care coordination for beneficiaries with chronic conditions. 

In the Policy Document, the Bipartisan Chronic Care Working Group (the Working Group) makes it clear that the options presented are not proposals and do not represent policies endorsed by the Committee or the Working Group; rather, the Policy Document “is intended to generate . . . comments, feedback, and input from Finance Committee members and stakeholder groups” to assist the Working Group in identifying a more refined list of policy approaches for use in the development of legislation in 2016.  As such, the Policy Document provides not just an outline of potential policy changes, but also an opportunity for stakeholders to comment on specific changes that could strengthen the Medicare program’s adoption of telehealth.  Comments on the document from interested stakeholders are due by January 26, 2015, and should be emailed to the Committee.

Background on Medicare Coverage of Telehealth Services

As background, Medicare has historically provided limited coverage for telehealth services.  Medicare has covered the provision of telehealth services if the beneficiary is seen: (a) at an approved “originating site” (e.g., physician offices, hospitals, skilled nursing facilities) that is located within a rural Health Professional Shortage Area (HPSA) that is either outside of a Metropolitan Statistical Area (MSA) or in a rural census tract, or a county outside of a MSA; (b) by an approved provider (e.g., physicians, nurse practitioners, clinical psychologists); (c) for a small defined set of services, including consultations, office visits, pharmacological management, and individual and group diabetes self-management training services; and (d) using certain telecommunications technologies.

Summary of Chronic Care Policy Options

The following is a description of the key Policy Document provisions that impact Medicare’s coverage of telehealth services.

Expanding Access to Home Dialysis Therapy

In an effort to improve patient outcomes while reducing health care costs, without the need for care in an institutional setting, the Working Group suggests that utilizing telehealth to satisfy the monthly clinical visit requirement for home dialysis could provide greater flexibility for those receiving home dialysis, encouraging patient independence.

Medicare provides that beneficiaries receiving home dialysis treatment may receive a clinical assessment via telehealth only if the telehealth visit conforms to the existing Medicare requirements for telehealth reimbursement.  The Working Group is considering two possible changes to these requirements in the home dialysis context, the first would be that the geographic limitations on Medicare reimbursement are lifted so that free-standing dialysis facilities outside a HPSA constitute acceptable originating sites, and the second, that a dialysis patient’s home might be considered an originating site as well. 

The Working Group is seeking feedback on whether expanded telehealth availability should include mandatory periodic in-person clinical visits (e.g., once every three to six months) and whether a patient’s home is an appropriate originating site for a telehealth visit.

Medicare Advantage Changes

The Working Group identified potential policy changes to increase innovation and technology in Medicare Advantage plans both directly and indirectly.  Directly, the Working Group suggests that allowing Medicare Advantage plans to include telehealth services as a part of their bid would help the plans fund the utilization of telehealth services.  Currently, telehealth services are not separately paid for by Medicare.  The Working Group is seeking feedback on the type of telehealth service appropriate for this approach (e.g., should the telehealth services be limited to those provided under the traditional Medicare program?).

Indirectly, the Working Group suggests that supplemental benefits under Medicare Advantage could be expanded to include services that could benefit beneficiaries, but which are not currently allowed.  The Working Group notes as an example, services related to nutrition.  While telehealth is not specifically identified by the Working Group, given the proliferation of mobile medical applications and other technologies designed for consumers interested in understanding and improving their overall health, it is not difficult to imagine that some of these additional services could include telehealth strategies.  The Working Group is seeking feedback on the criteria that could be used to determine what supplemental benefits could be offered and safeguards that should be put in place to avoid abusive practices.

Providing ACOs the Ability to Expand Telehealth Use

Noting that the “provision of telehealth services has the potential to improve access to care, lower costs, and improve health outcomes,” and that previous stakeholder feedback indicated that telehealth services are important tools for accountable care organizations (ACOs), the Working Group suggests that a waiver of the geographic restrictions on telehealth for accountable care organizations should be considered.  Similar to their dialysis at home suggestion, the Working Group also suggests expanding the definition of the originating site to include a patient’s home. The Working Group is seeking feedback on the loosening of the originating site restrictions and what safeguards should be considered for a beneficiary’s home constituting the originating site.

The Policy Document also suggests consideration of expansion of telehealth services to ACOs by modifying the requirements for reimbursement for telehealth services provided by ACOs in the Medicare Shared Savings Program (MSSP), as well as modifications to allow ACOs to furnish remote patient monitoring services for which payment is not made under a fee-for-service basis.

Embracing Telestroke Programs

The Policy Document contemplates expanding telehealth services for beneficiaries who have experienced a stroke.  Specifically, the Working Group suggests consideration of eliminating the originating site geographic restriction for purposes of identifying and diagnosing strokes to “provide every Medicare beneficiary the ability to receive an evaluation critical to diagnosis of an acute stroke via telehealth from a neurologist not on-site.”  Due to Medicare’s originating site geographic restrictions, this type of care delivery model is currently available only to individuals in located in rural areas.

Empowering Individuals and Caregivers in Care Delivery

The Policy Document contemplates various means to allow individuals and caregivers to better manage chronic disease, including expanding access to prediabetes education and digital coaching via the Centers for Medicare & Medicaid Services’ (CMS) website. 

Key Takeaways

The Working Group’s attention to the role of telehealth builds upon certain regulatory flexibilities already offered by the Center for Medicare & Medicaid Innovation (CMMI), and early CMMI evaluations could further affect the Working Group’s thinking.  For example, CMMI has issued telehealth payment policy waivers, which remove the geographic site and originating site requirements for payment of telehealth services, for its voluntary Bundled Payment for Care Improvement Models 2 and 3 and Next Generation ACO Model, as well as for its first mandatory model, the Comprehensive Care for Joint Replacement Model.  In turn, under these models, eligible beneficiaries may receive telehealth services in their home or in an originating site, with certain restrictions. In the context of MSSP, CMS has indicated that payment policy waivers “may be necessary… to give ACO participants and ACO providers/suppliers more flexibility... to provide appropriate and timely care for assigned beneficiaries,” and that it anticipates issuing telehealth payment policy waivers as soon as January 2017, after it has evaluated the waivers in CMMI’s existing pilots. 80 FR 32807. In turn, this proposal in the Policy Document may be redundant to already forthcoming telehealth flexibilities anticipated for MSSP ACOs.

Broader commentary and actions by CMS further suggest a growing acknowledgment by the agency of telehealth as a tool for value-based care and alternative payment models. For example, the June 2015 MSSP final regulations cite the role of telehealth as a means to improve care and avoid unnecessary costs. 80 FR 32723. CMS also added a new eligibility requirement in the final regulations requiring each ACO to describe in its application how it will encourage and promote the use of technologies that improve care coordination for beneficiaries, citing telehealth and remote monitoring services as two examples. 80 FR 32725. CMS and the Office of Inspector General also have stated that telehealth financial arrangements are eligible to receive protection under specific MSSP ACO fraud and abuse waivers, for example allowing the provision of home health monitoring of blood pressure to a hypertensive patient for free or under fair market value.

The Policy Document and the aforementioned measures demonstrate Congress’s interest in opportunities to accelerate access to telehealth services across Medicare, including notably in Medicare Advantage, to improve quality, reduce costs and increase care coordination for Medicare beneficiaries.  Given the increased focus by Congress and the states on the uses and benefits of telehealth, as evidenced by the numerous telehealth-related bills that were introduced in 2015, it is safe to assume that telehealth will continue to be integrated into new payment and care delivery models in support of the shift from fee-for-service to fee-for-value.

© 2018 McDermott Will & Emery

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Marshall E. Jackson, Jr. is an associate in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Washington, D.C. office.  Marshall focuses his practice on transactional and corporate matters affecting health care organizations,  including business organization, corporate governance, mergers and acquisitions, strategic affiliations and joint ventures.  Marshall also provides advice and counsel on a full range of federal and state fraud and abuse laws to hospital systems, medical practice groups and pharmacies.

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Lisa Schmitz Mazur is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Chicago office.  Lisa maintains a general health industry practice, focusing on the representation of hospitals and health systems and other health industry providers.

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