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Overwhelmed by Medicare's 600-page telehealth rule? Here are the 2 key takeaways.

June 13, 2019

    In January, we commented on a proposed policy that would allow Medicare Advantage (MA) plans to expand telehealth coverage in a more budget-friendly way. The recently finalized rule is doing exactly that—and more. Here's what the final version does, and why we think it will increase telehealth adoption among Medicare Advantage beneficiaries.

    Ready-to-present slides: Telehealth industry trends for 2019

    De-coding the rule

    The rule makes two major changes to how MA plans can reimburse telehealth, effective in 2020:

    1. It expands the funding available for plans to spend on additional telehealth offerings. Historically, plans were only able to fund additional telehealth as a supplemental benefit. Supplemental benefits all had to be funded through a small pool of dollars that could be used for anything from gym memberships to vision coverage. This "competition" for funding meant that MA plans were slow to reimburse for any telehealth services that were not covered by fee-for-service (FFS). Now, additional telehealth services can be considered "basic benefits," which are funded by the plan's core funding source: the money received from its initial bid to CMS. Observers believe that this change will make it more likely for MA plans to offer telehealth benefits that extend beyond what is allowed under FFS.

    2. It eliminates the location restrictions for MA patients. This change means patients are not required to be in rural areas to receive billable telehealth services. It also means that patients are allowed to receive services without being in a qualified health care facility; patients can be anywhere, including their homes.

    Why this could drive utilization

    While the first change—offering more funding—makes plans more likely to offer  expanded telehealth coverage, we believe that the second change will make consumers more likely to adopt  these newly available services. Our numbers suggest that eliminating location restrictions for telehealth coverage could drive utilization among MA patients in two key markets:

    1. Urban dwellers: Urban patients are already using telehealth at much higher rates than rural ones—according to our 5,000-participant Consumer Preferences Survey, more than a third of urbanites have used a virtual visit, compared with only 9% of rural patients. By extending coverage to urban beneficiaries, MA plans give these already inclined consumers even more reason to use telehealth.

    2. Direct-to-consumer services: Many of the services that Medicare beneficiaries would consider receiving virtually are those that allow the patient to remain at home. For example, nearly half of Medicare beneficiaries in our survey said they would definitely/probably consider virtual visits for prescription refills or questions, and 29% said the same for health coaching.

    Ready-to-present slides: Telehealth industry trends for 2019

    Whether you're considering adding telehealth to your service offerings, or have already made the investment, this ready-to-use presentation can save you time and make your next planning meeting a snap. It contains our most popular slides on telehealth market trends, including an industry overview, factors influencing adoption, and expected ROI.

    Use the slides to frame your next strategy meeting and build a strong foundation for your presentation.

    Get the Slides


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