Telemedicine and alternative payment models: An apt fit

December 12, 2016 by admin
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With 30% of Medicare payments now tied to alternative payment models (APMs), and HHS planning to raise that percentage to 50% by the end of 2018, providers are looking for ways to increase quality of care and patient access while holding down costs. One mode that stands to gain is telemedicine, which got a boost in last year’s Medicare Access and CHIP Reauthorization Act (MACRA).

The legislation, signed into law by President Obama in April 2015, creates a 5% annual payment bonus for physicians who participate in APMs and exempts them from participating in the Merit-Based Incentive Payment System (MIPS). It specifically mentions telemedicine and remote patient monitoring as services that APMs may cover, even if those services are not reimbursed under traditional Medicare.

MACRA essentially lifts all restrictions that would otherwise exist under fee-for-service and allows doctors to utilize telemedicine and remote patient monitoring services where appropriate — offering a green field opportunity to rethink care delivery in a way that’s patient-centered and promotes care coordination and communication.

What are the options?

The American Medical Association, which has long supported telemedicine, is working to identify condition-based APM options and how telemedicine may play a role in them.

One of those options is Next-Generation Accountable Care Organizations, which went live with applications earlier this year. Unlike the Pioneer ACOs, which did not anticipate a lot of telehealth use, the next-gen ACOs feature special carve-outs and waivers and opportunities for virtual care, said Nathaniel Lacktman, a lawyer at Foley & Lardner and head of the firm’s telemedicine and virtual care practice.

Lacktman predicts that 2016 will be the year of the ACO. “I think it will hold true that a lot of them, when you check at the end of the year, will have added telehealth technologies within their existing operations,” he said. He told Healthcare Dive he would not be surprised to see some Pioneer ACOs and hospitals or health systems that have been on the sidelines of ACOs apply to become next-generation ACOs because of the telehealth opportunities.

Telehealth allows patients to connect remotely with physicians via phone or videoconference to address healthcare concerns. It has been used for years to conduct specialty consultations in rural areas, where access to doctors is more limited.

It is also convenient, allowing busy people to address health issues on the fly, rather than giving up a chunk of their day for an in-person doctor appointment.

“Where it really shines is it allows the providers to manage risk better, and because they can manage risk better they’re able to enter into capitated contracts, and that’s where the money is,” Lacktman said.

With telemedicine, you are increasing patient touches and the frequency of those touches, while remote patient monitoring allows you to be more informed about the patient’s actual state of health.

Another APM model is the Medicare Shared Savings Program (MSSP). Thanks to MACRA, MSSP now recognizes telehealth services as a clinical practice improvement activity, one of four components required to qualify for incentive payments.

Recent rule changes to the MSSP program allow physicians who provide patients with some free equipment for remote patient monitoring to be eligible for fraud and abuse waivers. An example CMS gave was a patient with high blood pressure using home telehealth to monitor their condition.

According to CMS, only 27% of MSSPs actually had cost savings and quality improvements sufficient to trigger their reward payments. But a separate study found that only 20% of MSSPs were using telehealth, Lacktman noted. While he cannot say there is a correlation, “all of the plans I work with that used telehealth technologies in 2014 received incentive payments,” he said.

Why is telemedicine become increasingly popular?

Some medical specialties, such as mental health and radiology, are well-suited, for telehealth. Another area where telemedicine is having an impact is neurology and stroke services, where consulting with a neurologist within four hours of having an event can have a huge impact on patient outcomes.

A less obvious example is the emergency department where teams of board-certified physicians in a central hub provide round-the-clock access to underserved rural hospitals via two-way video, teleconferencing, and other technologies.

Legislation now before Congress could give telehealth an even bigger push. The Creating Opportunities Now for Necessary and Effective Care Technologies (CONNECT) for Health Act, introduced in February by a bipartisan group of senators, would remove remaining Medicare barriers to use of telehealth at a projected savings of $1.8 billion over 10 years.

Under CONNECT, for example, physicians and health systems participating in APMs would be able to use remote patient monitoring for patients with chronic conditions. And it would expand use of telemedicine and remote patient monitoring in rural health clinics and community health centers. A similar bill was introduced in the House.

Telehealth payment parity is also gaining traction at the state level, with 29 states and the District of Columbia having enacted telemedicine laws. These laws are expected to drive uptake of telehealth among commercial insurers. An example is Independence Blue Cross of Philadelphia, which recently announced plans to cover telemedicine.

“Change is happening, and we know that the Medicare program drives change on the commercial side as well,” Lacktman said. “That means that it won’t just affect the people who are 65 and older. It will affect all the younger people as well.”