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Feds Take CMS to Task Over Improper Telehealth Reimbursements

Roughly 30 percent of Medicaid reimbursements for telehealth in 2014-15 were made in error, according to sample of 100 payments analyzed by the Office of the Inspector General.

Source: ThinkStock

By Eric Wicklund

- About three of every 10 Medicare reimbursements for telehealth in 2014-15 were made in error, according to a recent audit by federal regulators.

The U.S. Health and Human Services Department of the Inspector General announced last week that an examination of 100 claims for distant-site telehealth services found 31 claims that did not meet requirements set by the Centers for Medicare & Medicaid Services for reimbursement. Those incorrect claims cost CMS roughly $3.7 million, the report stated.

The OIG launched its investigation in July 2017 following a report from the Medicare Payment Advisory Commission (MedPAC) that indicated Medicare reimbursement claims filed in 2009 without associated claims for originating site facility fees were likely for non-reimbursable services. The agency then found that more than half of the claims filed during 2014-15 did not matching originating site facility fee claims.

The OIG selected 100 claims from the 191,118 Medicare paid distant-site telehealth claims filed in 2014-15, totaling $13.8 million, that did not have corresponding originating-site claims. Of the 31 claims determined to be non-reimbursable:

  • 24 claims were made by beneficiaries who received services at non-rural originating sites;
  • 7 claims were billed by ineligible institutional providers;
  • 3 claims were for services provided to beneficiaries at unauthorized originating sites;
  • 2 claims were for services provided by an unallowable means of communication (one was asynchronous and the other was telephone);
  • 1 claim was for a non-covered service; and
  • 1 claim was for services provided by a physician located outside the United States.

The report touches upon one of the biggest barriers to telehealth and telemedicine adoption in the US: the restrictive and oftentimes confusing set of guidelines for CMS reimbursement, particularly in determining where such services can be delivered.

READ MORE: CBO Analysis Highlights ROI Challenge Faced by Telehealth Bills

Last April, a report prepared by the US Government Accountability Office found that providers aren’t adopting telehealth or telemedicine because of uncertainties around what is and isn’t reimbursed.

The GAO report, issued as part of the Medicare Access and CHIP Reauthorization Act of 2015, found that Medicare, Medicaid, the Veterans Administration and the U.S. Department of Defense used telehealth to treat 12 percent or less of their beneficiaries in 2014 through 2016, with less than 1 percent of Medicare beneficiaries using any telehealth services.

Providers surveyed for the report cited “the potential to improve or maintain quality of care as a significant factor encouraging the use of telehealth and remote patient monitoring,” but they rated “cost increases or inadequate payment and coverage restrictions” as either somewhat or very significant barriers to adoption.

Meanwhile, an analysis of CMS’ 2016 payments for telehealth and telemedicine, released last August, showed a strong uptick in total reimbursements, claims submitted and originating site claims, but the total is still a small fraction of CMS’ total payments of $600 billion-plus and nowhere near what the federal government anticipated spending some 15 years ago.

In its report on CMS reimbursements, the OIG faulted CMS for not analyzing the telehealth claims more thoroughly, and made three recommendations:

  1. Conduct periodic post-payment reviews to disallow payments for errors for which telehealth claim edits cannot be implemented;
  2. Work with Medicare contractors to implement all telehealth claim edits listed in the Medicare Claims Processing Manual; and
  3. Offer education and training sessions to practitioners on Medicare telehealth requirements and related resources.

READ MORE: CMS, AMA Look for Common Ground on Remote Patient Monitoring

Nathanial Lacktman, an attorney with the Foley & Lardner law firm and chairman of its Telemedicine Industry Team and co-chair of its Digital Health Work Group, said providers shouldn’t fear the audit or use it as an excuse to put off new programs.

“Before billing Medicare for telehealth services, it is essential the hospital or healthcare provider understand and adhere to the specific conditions of coverage required by CMS,” he wrote in a recent blog. “Current coverage of telehealth services under Medicare is limited, with the coverage restrictions established via statute under the Social Security Act. Any notable expansion of telehealth coverage under Medicare would require legislation by Congress.”

Some of those restrictions, Lacktman noted, should be eased once the Bipartisan Budget Act, signed into law this February, takes effect. In the meantime, he said, healthcare providers should take note of the five conditions for Medicare coverage of telehealth:

  1. The beneficiary is located in a qualifying rural area (providers can check if the originating site is in a qualifying rural area by using the Medicare Telehealth Payment Eligibility Analyzer);
  2. The beneficiary is located at one of eight qualifying originating sites (i.e., the offices of physicians or practitioners; Hospitals; Critical Access Hospitals; Rural Health Clinics; Federally Qualified Health Centers; Hospital-based or CAH-based Renal Dialysis Centers (including satellites); Skilled Nursing Facilities; and Community Mental Health Centers);
  3. The services are provided by one of ten distant site practitioners eligible to furnish and receive Medicare payment for telehealth services (i.e., physicians; nurse practitioners; physician assistants; nurse-midwives; clinical nurse specialists; certified registered nurse anesthetists; clinical psychologists; clinical social workers; registered dietitians; and nutrition professionals);
  4. The beneficiary and distant site practitioner communicate via an interactive audio and video telecommunications system that permits real-time communication between them (store and forward is covered in Alaska and Hawaii under demonstration programs); and
  5. The CPT/HCPCS (Current Procedural Terminology/Healthcare Common Procedure Coding System) code for the service itself is named on the CY 2017 (or current year) list of covered Medicare telehealth services.

The OIG is also conducting an audit of state Medicaid payments for telehealth and telemedicine services. A report on that audit is expected in 2019.

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