The COVID-19 pandemic prompts payers to encourage the shift to telehealth, a move supported by patients and providers. How will this change the future of healthcare delivery?
The novel coronavirus stopped traditional healthcare in its tracks, but there’s one bright spot: telehealth. As technology has advanced over the last several years, it seemed as though at any moment, telehealth would finally take off. But while the market size of the telehealth services industry growth has outpaced other areas of healthcare, with 25% average annual growth from 2015 to 2020, relatively few of us have experienced a virtual healthcare visit. That is, until now.
Recognizing the potential of telehealth to provide safe and continuous care to those in need – both potential COVID-19 patients and those in need of other non-emergent healthcare – the CARES Act stimulus package offered $200 million through the Federal Communications Commission to medical groups to help them install the technology and fund broadband installations. At the same time, CMS and commercial health plans have temporarily introduced payment parity and relaxed some regulations that have traditionally held back progress on the initiative.
These interim changes and financial support have dramatically increased provider, patient and payer experiences with telehealth, and early surveys indicate general satisfaction and acceptance. What does this mean for the future of telehealth? Here, we explore how telehealth has evolved in recent years, including traditional barriers to adoption, and how the pandemic has accelerated the way forward.
What is telehealth?
The Center for Connected Health Policy defines telehealth as “a collection of means or methods for enhancing health care, public health and health education delivery and support using telecommunications technologies. Telehealth encompasses a broad variety of technologies and tactics to deliver virtual medical, health, and education services. Telehealth is not a specific service, but a collection of means to enhance care and education delivery.”
While the term “telemedicine” is used for traditional clinical diagnosis and monitoring delivered by technology, telehealth is used more broadly to cover the wide range of diagnosis and management, education, and other related fields of health care, including dentistry, counseling, physical and occupational therapy, home health, chronic disease management and more. It also covers live video visits, mobile health data, remote monitoring via connected devices and store-and-forward technologies for secure sending of health information.
Barriers to telehealth adoption
Even before the novel coronavirus pandemic took hold, telehealth was slowly expanding, but there were numerous challenges to its widespread adoption, the biggest of which were complex regulatory barriers and lack of payment parity.
First, regulations vary depending on CMS, state Medicaid, and state commercial health plan requirements. All are different but restrictions on type of service, location of service (both provider and patient), provider credentials, cross-state visits and/or state licensure and more are common. That said, according to a recent survey, 42 states and Washington, D.C., now have some sort of telehealth commercial insurance coverage law, an improvement over the last five years. However, only 10 states offer true payment parity, which disincentivizes providers to offer it.
As a result of this complexity, telehealth has been minimally available to consumers until recently. In a 2016 survey, over half of consumers surveyed indicated they wouldn’t use telehealth and 39% said they hadn’t even heard of it.
Historic resistance to telehealth
Payers and other entities have historically resisted adopting measures that would expand telehealth adoption by limiting reimbursement and the number of eligible procedures as well as enacting
various provider restrictions. A 2018 hearing regarding a Connecticut telehealth bill illustrates the concerns about payment parity. The legislation was supported by providers, but payers and employers opposed the payment provisions citing their desire to negotiate reimbursement themselves as well as arguing that telehealth should fundamentally be a lower cost option.
A more recent debate holds state medical boards responsible for holding back telehealth progress with their role in continuing to forward credentialing, cross-state and established relationship restrictions. While concerns about malpractice and liability are valid, it’s difficult to say if patient safety is more at risk with telehealth.
The same argument holds for potential fraud. Though the telehealth industry argues virtual visits are no more susceptible to fraudulent activities than other healthcare encounters, regulators hold that these restrictions are necessary guardrails because of the increased capacity. As one official with the HHS Inspector General’s Office states, “There are unscrupulous providers out there, and they have much greater reach with telehealth. Just a few can do a whole lot of damage.” Health plan SIUs likely will need to adjust metrics currently used to find fraud in in-person encounters, as legitimate telehealth claims may look like previously “impossible visits” regarding provider capacity and geography, for instance.
Telehealth benefits during the pandemic
The novel coronavirus pandemic has quickly demonstrated the significant benefits of telehealth – both for patients and providers – and thus its market viability. While the pandemic has accelerated telehealth use, one survey indicated that telehealth was already beginning to really take hold with over a third of Millennials and Gen Xers taking advantage of virtual visits. The survey also demonstrates the potential of telehealth, noting that, “based on actual claims costs and coding over the two-year study, approximately 71% of convenience and urgent care visits could have been virtual visits, saving ... $3.8 million, or 45% of allowed costs.”
A story out of Pennsylvania illustrates telehealth’s unique benefits for the management of chronic disease, especially for an area with a huge rural and elderly population. Telehealth visits for the region’s largest healthcare provider jumped 3700% from early March to late April. While there were technical challenges for both patients and providers in the beginning, “the satisfaction rate among patients is remarkably high.” They are working on documenting the outcomes during this period to prove the technology’s viability for long-term use, which may be particularly useful for health plans looking to expand risk-based contracts.
Recent surveys also reveal the pandemic’s impact on physicians and their response. One showed that in-person healthcare visits were down by 67% while overall visits decreased by 54%. However, of the total ambulatory practice visits, 30% were delivered through telehealth, and half of physicians now offer telehealth, up from only 18% two years ago. With 20% of surveyed primary care practices at risk of permanent closure due to the pandemic, many are turning to telehealth to provide continuity for patients as well as to bridge the financial gap. As one physician noted, “The process allows them to keep open that virtual front door in a meaningful way."
Telehealth moving forward
So, what’s the fate of telehealth post-pandemic? Bipartisan legislation introduced in October 2019, the CONNECT Act, aims to reduce barriers to telehealth in Medicare, so there is existing support. Additionally, the current situation presents CMS, state Medicaid administrators, state medical boards, and commercial payers alike with several considerations.
Now that consumers have been able to experience the convenience of telehealth for themselves, they are unlikely to desire a return to the “old way.” Even the elderly population has taken advantage of the safety and flexibility offered by virtual care from their homes. And, combined with payers’ historic focus on digital technology that supports member satisfaction initiatives, health plans may be open to extending telehealth coverage now that consumers are embracing it.
In addition, more providers have invested in telehealth capabilities to support operational continuity, which reduces infrastructure barriers and promises to mitigate the foretold provider shortage. Because the novel coronavirus has put undue stress on the physical and operational health of providers, continuing the relaxed telehealth regulations indefinitely may prove to be the right move.
This situation provides an ideal proving ground to test how payment parity and minimizing restrictions affects patient care. If all proceeds without dire consequences, it will be difficult to put the genie back in the bottle.
Health plans turn to Pareo
Expanding telehealth coverage can no doubt add complexity to an industry that is already shouldering a great deal during this time. Adding to the significant administrative burden of health plans and providers is unsustainable. During the pandemic and beyond, health plans can no longer deny the numerous benefits of digital transformation. Advanced payment integrity technology platforms like Pareo allow payers to support rapidly changing provider contracts and payment policies and seamlessly engage with providers.
While the expansion of telehealth at such a rapid pace is a new development, most payers have long-anticipated a shift to digital care to improve patient access and intervention for value-based care initiatives and other healthcare cost savings measures. However, health plans who are not agile in data sharing, accessing relevant business insights, or even vendor management may struggle to modernize operations fast enough.
Administrative burden is a problem that most payers have yet to solve, and the quick expansion of telehealth is sure to exacerbate the issue. Pareo is unique in that it not only unites disparate systems and automates workflow (solving many efficiency problems), but our payment integrity technology also sets the stage for health plans to own the core operations that power revenue. Our clients have seen up to a 10x return on investment, with efficiency gains estimated at 25-50%.
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