Ohio Think Tank Supports Telehealth Bill, But Not Payment Parity

September 23, 2020 - An Ohio think tank has published a report supporting legislation to extend telehealth coverage in the state – including the decision to move away from payment parity.

“Access to Healthcare Made Easier: Promoting Best Practices in Ohio’s Telehealth Policy” was released this week by James Woodward, PhD, an analyst with the Economic Research Center at the Columbus-based Buckeye Institute. In it, he sees success with connected health access and coverage during the coronavirus pandemic and urges state lawmakers to pass HB 679, which would expand and improve on the state’s current telehealth laws.

“With little indication that the new-found demand for telehealth services will subside, Ohio should continue to promote remote access to medical advice, doctor’s visits, and testing by facilitating innovation and pursuing best practices in telehealth,” Woodward writes. “Ohio’s House Bill 679 takes significant strides in that direction.”

But the bill, he says, could see use some fine-tuning, particularly around the issues of cost-sharing and standards of care. And he supports the controversial decision to go against mandating payment parity for telehealth services.

“Private insurers have recognized the promise of telehealth and have already shown a willingness to expand telehealth coverage, but they are still learning where the true potential and value for telehealth really lies,” Woodward says. “A payment parity requirement at this early stage would prematurely signal that telehealth treatment options are interchangeable with in-person visits in terms of cost and quality. Medical studies, however, do not warrant this conclusion or pricing structure inasmuch as there are still many areas in which telehealth’s medical value is not yet established.”

READ MORE: New Bill Looks to Mandate Payer Coverage for Telehealth Services

Woodward says a payment parity mandate would steer payers away from covering telehealth services that haven’t yet proven their value and stifle growth in the industry.

The issue is among the most hotly debated in telehealth these days, with some arguing that providers won’t try out virtual care unless they’re reimbursed at the same rate as in-person care. Others say that since telehealth is primed to reduce healthcare costs, those reductions should be seen in payments to providers to use the technology.

With telehealth seeing a great deal of momentum during the COVID-19 crisis, many states and several payers have pledged to continue telehealth coverage beyond the existing crisis, during which coverage and access are expanded under emergency measures. Some are promoting payment parity, saying the industry needs that support to compel telehealth adoption. Others have argued that payers should be able to negotiate their own coverage rates with providers free of legislative pressure.

“Requiring payment parity would lead to misleading price signals and undermine the competitive process that is unleashing telehealth’s latent potential,” Woodward concludes in his report. “Just as the existing fee-for-service system encourages overuse and overpayment, payment parity requirements would impose the same dynamic upon a new treatment option, possibly benefitting insurers and providers, but not patients or the health system as a whole.”

On other issues in HB 679, Woodward agrees with the bill’s language treating cost-sharing arrangements for telehealth at the same rate as in-person visits, noting it “helps avoid overusing unnecessary services by forcing patients to share in the cost of their treatment.” But he disagrees with the waving of cost-sharing for preventive care visits initiated by the clinician, saying research has shown that patients are willing to pay for those services if they’re convinced that telehealth will help them avoid more expensive treatments down the road.

READ MORE: Ohio Medicaid Asks to Make Expanded Telehealth Coverage Permanent

In addition, Woodward approves of wording in the bill that doesn’t mandate audio-visual telemedicine, noting that store-and-forward telehealth and even the basic landline telephone have been proven useful in certain areas. But while the bill requires that telehealth services be consistent with the standard of care for providers, it does give the State Medical Board of Ohio and other licensing boards to ability to limit patient access to certain telehealth services.

“The medical board may elect, for example, to classify some telehealth services within the standard of care of one professional but not another for reasons that have nothing to do with the practitioner’s expertise or ability,” he says. “Such restrictions do not help patients, but benefit some professions at the expense of others - a recurring issue in the licensing of health professionals.”

To that end, Woodward recommends that Ohio’s medical board follow the lead of North Carolina’s medical board, which recognizes telehealth’s value and holds providers to the same standards as in-person care but doesn’t support a separate standard of care.

“Such an approach would leave the treatment decision up to the patient and provider while still holding the licensee accountable to the board,” he wrote.

Finally, separate from HB 679, Woodward makes the case for relaxing the rules to allow clinicians to use telehealth across state lines, though he stops short of recommending that Ohio join any of the interstate licensure compacts.

“Allowing care providers to practice across state lines in Ohio was a temporary rule change brought on by the pandemic, (b)ut making these changes permanent would provide patients with more treatment options and make it easier for them to see the best doctor for their situation,” he says. “When the state allows patients and care providers to negotiate on the basis of their needs and situations - without artificial geographical limitations - research and recent experience show that health care systems can adapt quickly and innovatively to better serve patients.”