Recently-Passed CHRONIC Act Allows for Increased Medicare Coverage for Telehealth Services

Although telehealth services are in high demand from patients, providers’ adoption of telehealth has been limited because many payers, particularly Medicare, have historically placed tight restrictions on coverage of telehealth services.

The two-year budget deal, signed into law on February 9, 2018, includes passage of the Creating High Quality Results and Outcomes Necessary to Improve Chronic Care Act of 2017 (also referred to as the CHRONIC Act). The CHRONIC Act expands Medicare coverage and reimbursement of telehealth services provided to certain beneficiaries that signals a shift in policy supportive of telehealth. The Arent Fox Health Care team previously covered the CHRONIC Act in a May 17, 2017 Alert summarizing several recently-introduced or passed bills that ease federal health care programs’ restrictions on telehealth. 
 
Currently, Medicare coverage of telehealth services is limited to certain Part B services furnished by a physician or practitioner via telehealth where (i) the patient is in a qualifying rural area; (ii) the patient is at one of eight qualifying facilities or originating sites; and (iii) the service is provided over real-time audio-video feed. The CHRONIC Act, however, expands the use of telehealth under Medicare Advantage (MA) plans and Accountable Care Organizations (ACOs) as well as for end stage renal disease (ESRD) assessments and acute stroke treatments. 

Medicare Advantage Plans

Starting in MA plan year 2020, MA plans will have the option of providing additional telehealth benefits, including: (i) benefits available under Medicare Part B but were previously ineligible for payment when furnished via telehealth; and (ii) additional services identified as clinically appropriate to furnish via telehealth.
 
By November 30, 2018, the Secretary of the Department of Health and Human Services must solicit comments on the types of items and services that should be considered additional telehealth benefits. Moreover, the Secretary must establish requirements for telehealth benefits, including physician and practitioner qualifications (factors necessary to ensure coordination with benefits furnished in-person) and other areas determined by the Secretary. Telehealth stakeholders should keep an eye out for the Secretary’s solicitation for comments, which would be a prime opportunity to suggest items or services that should be covered by MA plans when provided via telehealth.

Accountable Care Organizations

Under the CHRONIC Act, ACOs will have the ability to expand the use of telehealth services by allowing Medicare fee-for-service beneficiaries to receive telehealth services in their homes. Beginning on January 1, 2020, services provided to Medicare fee-for-service beneficiaries who are assigned to an ACO may be done in the beneficiary’s home, which will be deemed an eligible originating site. The CHRONIC Act also eliminates the geographical requirements for telehealth for ACOs (i.e., that the originating site be located in a rural health professional shortage area or non-metropolitan statistical area).
 
Indicating that the ACOs may serve as a “trial run” for expanded telehealth reimbursement for traditional Part B services, the CHRONIC Act requires the Secretary to conduct a study on the utilization and expenditures for telehealth services by applicable ACOs to be submitted to Congress by January 1, 2026, along with recommendations for legislative and administrative action.

End Stage Renal Disease Assessments & Stroke Treatments

Starting January 1, 2019, Medicare will cover monthly ESRD-related clinical assessments provided via telehealth to Medicare Part B home dialysis patients. Medicare beneficiaries receiving home dialysis must still receive monthly in-person, face-to-face assessments during their first three months of treatment and at least once every three months thereafter.
 
The CHRONIC Act also eliminates the geographic and facility type restrictions on origination sites for services involving the diagnosis, evaluation, or treatment of symptoms of stroke.

What’s the Takeaway?

Although telehealth reduces costs and improves access to health care, reimbursement limitations (particularly in the Medicare context) have prevented its widespread adoption. The passage of the CHRONIC Act is a major step in the right direction. Should these trends continue, providers will see a growing acceptance for telehealth services and increased coverage and reimbursement for telehealth services. 
 
Providers and other telehealth stakeholders must stay on top of the evolving issues associated with this emerging field. Telehealth poses a number of regulatory challenges: licensure, particularly for providers seeking to establish multi-state arrangements; scope of practice; reimbursement; and fraud and abuse.