The Growth Channel

Telehealth policy moves to watch in 2016

by Caitlin Gillooley

Interest, investment, and utilization of telehealth have been steadily growing across the past few years, but the status quo is still the old-fashioned in-person clinical encounter. What’s holding the market back from widely embracing virtual care?

As we’ve discussed before, a major barrier to the spread of telehealth is policy—particularly regarding reimbursement and practice standards. But based on the buzz, we predict that we’ll finally see this barrier fall in 2016. Here are the policy shifts to watch for across the next few months.

1. State telehealth bills

More than 200 telehealth bills were introduced in state legislatures last year. Many of these bills removed restrictions like geographic or distance requirements that made it difficult to get paid for virtual care; others added providers like physical therapists, psychologists, and nurse midwives to the list of providers eligible for reimbursement. Even bills that simply clarified the language around the definition of telehealth or practice standards paved the way for more telehealth-specific programs in the future.

Perhaps most telling is the fact that 32 states and DC now have private insurance parity laws, and 8 of the states that do not currently have a law saw parity bills proposed in 2015, carrying over into the 2016 session (IL, IA, MA, NJ, NC, OH, PA, and RI).

2. Licensure compacts

In addition to a difficult reimbursement landscape, telehealth has been held back by restrictive cross-state practice requirements. However, more states are offering special telemedicine licenses or reciprocal licensure for telehealth to ease the burden of interstate physician practice.

In 2016, this trend will go even further as more states consider entering into Interstate Licensure Compacts. These agreements expedite the licensure process and increase the “portability” of a medical license throughout participating states. So far, 12 states have entered into the Federation of State Medical Board’s compact for physician practice (NV, ID, MT, WY, UT, SD, MN, IA, WI, IL, AL, and WV) and 12 more have introduced bills to join (AK, AZ, WA, CO, NE, KS, OK, MI, PA, VT, NH, and RI). The National Council of State Boards of Nursing recently proposed a similar compact for nurse practitioners, as have associations for other advanced practitioners.

3. Congressional bills

Several bills were introduced in Congress last year that had some impact on telehealth, most of them regarding rural health care. This year we’ll be watching the TELE-MED Act, which was referred to committee in July, and seeks to permit certain Medicare providers to provide telemedicine services across state lines.

We’ll also be on the lookout for progress on the Telehealth Innovation and Improvement Act, which was introduced in December and looks to require the Center for Medicare and Medicaid Innovation (CMMI) to test the effects of telehealth on cost and clinical efficacy.

4. Medicare rules

Medicare added several billable codes for telehealth last year, and is adding 6 more in 2016. This expands Medicare’s financial support for chronic disease management in particular. MedPAC discussed the potential for telehealth to control costs at length at the end of last year, and is considering new reimbursement models for telehealth in 2016.

With MedPAC’s support for rulemaking, the Congressional Budget Office would likely conduct a formal review of telehealth’s financial impacts—which would, in turn, spark more discussion in Congress.

5. Quasi-regulatory programs

In addition to the formal regulatory process, we’ll also be on the lookout for non-governmental sponsored programs to support telehealth expansion. For example, telehealth accreditation programs are starting to promulgate standards and best practices for virtual care implementation; the American Telemedicine Association and URAC recently launched proprietary accreditation programs.

In addition, employers, ACOs, and other payers will invest more in telehealth as a care and cost management strategy as technology improves and decreases in price. Alternative payment models for telehealth—that is, financial support that doesn’t follow the traditional fee-for-service reimbursement process—will likely include telehealth as part of bundles of care services in an attempt to improve care coordination and increase patient access.

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