Telemedicine update for health execs: What to know

Changing reimbursement models, additional payments for remote patient care and evolving legal guidelines are moving telemedicine from a new trend to a well-established form of healthcare delivery.

Linkous“The rise in telehealth services is being driven by an effort to use technology to improve care quality, contain costs and meet growing consumer demand for access to care," says Jonathan Linkous, chief executive officer of the American Telemedicine Association (ATA). "Our whole way of paying for healthcare is changing very rapidly in this country.”

More than 10 million consumers directly benefited from using telemedicine last year, according to the ATA, and recent reports suggest that number could rise quickly over the next few years. A 2014 report from Deloitte, for example, predicted that 75 million of the average 600 million general practitioner appointments would occur through electronic visits in the U.S. and Canada in 2014.

The report estimated that the savings resulting from those visits could reach $5 billion. Other studies suggest that health plans and business are poised to take advantage of the potential benefits. According to a Towers Watson report, more than 80% of employers say they could be offering telemedicine services by 2018.

Next: Plans take action

Plans take action

In late 2014, Anthem announced that it would begin offering telehealth visits with no copay to its Medicare Advantage members in 12 states. And currently, most Anthem plans-including commercial, exchange, and Medicare-cover telehealth visits with doctors who use LiveHealth Online, a video service that links consumers to physicians for non-emergencies via smartphone, tablet or computer, says John Jesser, Anthem's vice president of provider engagement.

“Payers no longer want to pay for lots of services performed by providers," says Linkous. "They want to pay for quality care that helps patients get well and stay well, which reduces costs. They’re also more willing to pay for on-demand services and see telemedicine as a way of meeting those goals."

Anthem is not the only health plan getting involved with telemedicine. Cigna and Aetna provide varying forms of reimbursement for telemedicine services, and UnitedHealthcare says it will expand its telemedicine reach to encompass 20 million enrollees in 2016.

NEXT: The retail spin

The retail spin                 

On the retail pharmacy side, Walgreens plans to roll out a smartphone app that allows consumers to consult “virtually” with physicians for a range of acute conditions. These physicians can then e-prescribe medications when appropriate, says Walgreens' chief medical officer Harry Leider, MD. He calls telehealth “a natural extension" of the health services the company already offers, and he expects more payers to begin reimbursing for telehealth over the next five years.

“We view it as another way to meet the increasing demand from consumers for convenient and affordable care where and when they want it," says Leider. "We also believe that, as we continue to expand our offerings, we will significantly improve patient outcomes and enhance loyalty among customers.”

The last holdout

In the Medicare Physician Fee Schedule for 2015, the Centers for Medicare and Medicaid Services (CMS) added the following services to the list of services that can be furnished to Medicare beneficiaries under the telehealth benefit: annual wellness visits, psychoanalysis, psychotherapy, and prolonged evaluation and management services.

The Medicare Telehealth Parity Act of 2015 would also expand qualifying origination sites to include federal health centers, home health sites and counties in the Metropolitan Statistical Areas with populations in excess of 100,000. While traditionally private plans tend to follow CMS' lead when it comes to reimbursement, Linkous says that in this case, private plans are the initiators. “Medicare is the last great holdout," he says. "... Fortunately, we’re seeing private insurance companies, employers and states take the lead in telemedicine."