Telehealth and Medicare

Medicare is the federal health insurance program for people 65 or older, people with certain disabilities under 65 and people with end stage renal disease.  Medicare will reimburse for a limited set of telehealth delivered services if certain parameters are met.

Reimbursement

Medicare reimburses only for specific services when they are delivered via live video. Store-and-forward-delivered services are prohibited, except for Center for Medicare and Medicaid Services (CMS) demonstration programs in Alaska and Hawaii.  Medicare does not reimburse for remote patient monitoring services.

The specific telehealth-delivered services eligible for reimbursement under Medicare are identified by Current Procedural Terminology (CPT) or Healthcare Common Procedure Coding System (HCPCS) codes.  Each year, the US Department of Health and Human Services considers submissions for new telehealth-delivered services to be approved. Submissions are allowed from providers, advocacy organizations, and other interested parties.

CMS will decide to approve a submitted CPT code for reimbursement based on whether the service meets the requirements in one of two categories:

Category 1Services are similar to existing services, such as professional consultations, office visits, and office psychiatry services, which already are approved for telehealth delivery. In deciding whether to approve the new codes, similarities between the requested and existing telehealth services are examined, including interactions among the beneficiary and the practitioner at the distant site and, if necessary, the telepresenter, and similarities in the technologies used to deliver the proposed service.

Category 2Services not similar to Medicare-approved telehealth services. Reviews of these requests include an assessment of whether the service is accurately described by the corresponding CPT code when delivered via telehealth, and whether the use of technology to deliver the service produces a demonstrated clinical benefit to the patient.

CMS maintains a list of current CPT codes eligible for Medicare reimbursement for CY 2016. For information on the changes made for CY 2017, see CCHP’s factsheet on the CY 2017 final physician fee schedule. Newly approved services typically become eligible for reimbursement on January 1 of the following year.

Eligible Providers

Medicare limits the types of health care professionals who can provide telehealth-delivered services.  The small group of eligible professionals are:

  • Physicians;
  • Nurse practitioners;
  • Physician assistants;
  • Nurse midwives;
  • Clinical nurse specialists;
  • Clinical psychologists and clinical social workers (these professionals cannot bill for psychotherapy services that include medical evaluation and management services);
  • Registered dietitians or nutrition professionals.

Geographic Location

The patient’s location at the time services are received via telehealth is known as the “originating site.”  Medicare treats telehealth almost exclusively as a tool for rural areas, and has narrowly restricted the geographic areas that are eligible to use telehealth. The originating site must be in a Health Professional Shortage Area (HPSA) as defined by Health Resources and Services Administration (HRSA), or in a county that is outside of any Metropolitan Statistical Area (MSA) as defined by the US Census Bureau. Some argue against this restriction because many underserved areas are still barred from receiving telehealth-delivered services, and those that are eligible may not have an adequate population base to maintain a telehealth network.

Effective as of January 2014, CMS redefined rural HPSAs as areas located in rural census tracts as determined by the office of Rural Health Policy (ORHP). This allows eligible facilities located in rural census tracts that are within an MSA to be eligible telehealth originating sites. CCHP’s Changes to Medicare fact sheet outlines this new designation.  HRSA also maintains a Medicare telehealth payment eligibility search tool, where eligibility of an originating site may be checked. 

Eligible Facilities

In addition to the rural restriction, Medicare limits the originating sites eligible for telehealth-delivered services to the following facilities:

  • Provider offices;
  • Hospitals;
  • Critical access hospitals;
  • Rural health clinics;
  • Federally qualified health centers;
  • Skilled nursing facilities;
  • Community mental health centers;
  • Hospital-based or critical access hospital-based renal dialysis centers.

Chronic Care Management and Remote Monitoring

In January 2015, CMS created a new chronic care management code, which provides for non-face-to-face consultation.   This has opened up the possibility of receiving reimbursement for virtual asynchronous remote monitoring of chronic conditions. By not defining the codes as a “telehealth” service, these services are not subject to the restrictions other telehealth services currently face, such as geographic and location limitations and prohibitions on the use of asynchronous technology in most cases. For more information, see CMS’ FAQs and factsheet on the new codes.

Medicare Advantage, APMs and ACOs

Medicare does offer some exceptions to its geographic and originating site requirements through special programs, including the Next Generation ACO; Shared Savings Program; Episode Payment Models; and Comprehensive Care for Joint Replacement Models. Factsheets are available on many of these models on under CCHP’s Resources tab.

Medicare Advantage Plans may also offer telehealth as a supplemental benefit, however patients who elect to receive the benefit may pay for it with higher premiums, additional co-pays or from the plans’ rebates.