In its most recent report to Congress on Medicare payment policy, the Medicare Payment Advisory Commission (MedPAC) recommended that some of the expansions to Medicare coverage of telehealth instituted during the COVID-19 public health emergency (PHE) be retained for one to two years after the PHE ends, so that the impact of telehealth on access, quality and cost can be assessed. MedPAC recommends that after the end of the PHE, Medicare should return to paying the facility rate for telehealth services, and no longer permit providers to reduce or waive cost sharing for beneficiaries. Also, it recommends that the Centers for Medicare and Medicaid Services (CMS) should implement safeguards to protect against potential fraud relating to telehealth.

The report notes that the share of primary care services delivered by telehealth rose from less than 1% in January 2020 to 47% in April, but then declined to 18% in June as in-person services rebounded. Also, MedPAC notes that in the annual Medicare beneficiary survey, over 90% of respondents who had a telehealth visit reported being somewhat or very satisfied with their video or audio visit. While there are some clinical trials comparing telehealth and in-person care, there is not yet evidence on how expanded access to telehealth affects quality and costs in the Medicare program. Therefore, MedPAC recommends that some telehealth expansions be retained for a limited duration after the PHE ends to gather more evidence.

Prior to the PHE, in most cases Medicare coverage of telehealth was limited to beneficiaries receiving care at originating sites in rural areas. MedPAC recommends that Congress temporarily give CMS the authority to pay for telehealth services provided to all Medicare fee for service beneficiaries regardless of location, including the beneficiary’s home. Before the COVID-19 PHE, Medicare covered about 100 services provided by telehealth. This was expanded by over 140 services during the PHE. CMS recently added nine of these additional services to the allowable telehealth list (for permanent coverage), and allowed about 60 additional services to be billed through the end of the calendar year in which the PHE ends. MedPAC recommends that CMS continue to temporarily cover services that the agency determines have potential for clinical benefit. Prior to the PHE, telehealth services payable by Medicare had to be provided via a telecommunications system including two-way audio and visual communication technology. During the PHE, CMS allowed coverage of audio-only interactions for some telehealth services, including behavioral health services. MedPAC recommends that CMS continue to temporarily cover some telehealth services delivered through audio-only interaction when CMS determines there is potential for clinical benefit.

During the PHE, Medicare has paid for telehealth services at either the facility or the nonfacility rate, based on the location of the clinician. MedPAC recommends that CMS return to paying the facility rate (which is typically lower than the nonfacility rate). MedPAC also notes that during the proposed temporary expansion of telehealth, CMS can collect cost information from vendors that provide direct-to-consumer telehealth services to determine whether services provided through such vendors should be paid at lower rates than telehealth services provided by other clinicians. Also, MedPAC recommends that after the PHE ends, providers no longer should be permitted to reduce or waive cost sharing for beneficiaries, since requiring beneficiaries to pay part of the cost of telehealth services would help reduce the possibility of overuse.

MedPAC recommends that CMS permanently apply additional safeguards to protect the Medicare program from overutilization and potential fraud related to telehealth. Additional scrutiny to clinicians who bill many more telehealth services than other clinicians in the same specialty, or who bill for a high number of services in a week or month, may be indicated. MedPAC also suggests requiring an in-person face-to-face visit before a clinician can order expensive durable medical equipment or expensive laboratory tests. Finally, MedPAC recommends that CMS prohibit “incident to” billing by any clinician who can bill Medicare directly.

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