Telehealth Slowly Gains in State Medicaid Policies

Ken Terry

August 11, 2015

State Medicaid policies and laws are starting to open up the space for the use of telehealth or telemedicine (both terms are used in different states) in the treatment of patients, according to a new report from the Center for Connected Health Policy. But the majority of states still prohibit the use of "store-and-forward" telehealth and remote patient monitoring.

At this time, the Medicaid programs of 47 states and Washington, DC, reimburse for some form of live video consultation, with the patient usually located at an "originating site" outside the home. Last year, only 44 states covered this service.

Only nine state Medicaid programs, which is one fewer than in 2014, cover the use of store-and-forward technology, not counting teleradiology. They include Alaska, Arizona, California, Illinois, Minnesota, Mississippi, New Mexico, Oklahoma, and Virginia. New York will start covering store-and-forward on January 1, 2016.

Store-and-forward refers to the use of asynchronous, computer-based communication between a patient of a consulting provider or a referring healthcare provider and a medical specialist at a distant site, according to the American Telemedicine Association.

Sixteen state Medicaid programs offer reimbursement for remote patient monitoring (RPM) compared with 10 states in 2013. Among those that cover it today are Alabama, Alaska, Colorado, Illinois, Indiana, Kansas, Louisiana, Maine, Minnesota, Mississippi, New York, South Carolina, Texas, Utah, Vermont, and Washington. Pennsylvania and South Dakota cover RPM through other departments.

Limitations Apply, Vary

Just four state Medicaid programs (Alaska, Illinois, Minnesota, and Mississippi) reimburse for all three types of telehealth services (live video consult, RPM, and store-and-forward), with certain limitations.

Limitations in how states cover live video include the type of services that are covered (eg, office visit or inpatient consultation), the type of provider that can be reimbursed (eg, physician, nurse, or physician assistant), the location of the patient, and the location of the physician being consulted.

The limitations on store-and-forward coverage also vary from state to state. For example, California only reimburses for teledermatology, teleophthalmology, and teledentistry.

RPM coverage is also very restricted. Colorado requires the patient to be receiving services for heart failure, chronic obstructive pulmonary disease, asthma, or diabetes, and to meet other conditions. In Minnesota, RPM reimbursement is available only for skilled nursing visits and for patients in two other state health programs. Utah, which previously reimbursed for RPM only in a skilling nursing facility pilot, recently increased its coverage to include certain patients who have suffered strokes or transient ischemic attacks.

Eight state medical boards issue special licenses or certificates related to telehealth, including those of Alabama, Louisiana, New Mexico, Ohio, Oklahoma, Oregon, Tennessee, and Texas. Eleven other states have adopted the Federation of State Medical Boards' Interstate Medical Licensure Compact. They include Alabama, Idaho, Illinois, Iowa, Minnesota, Montana, Nevada, South Dakota, Utah, West Virginia, and Wyoming.

Under the compact, physicians who wish to practice in multiple states can be licensed in additional states without filling out a formal application or providing another set of records to those states. The medical board in their principal state of licensure, if it belongs to the compact, can attest to their qualifications.

Twenty-nine states have active laws that govern telehealth reimbursement policies for private payers. In addition, four states have passed telehealth laws that are not yet in effect. Statutes in Arkansas, Connecticut, and Minnesota will take effect January 1, 2016. A new law in Washington becomes effective January 1, 2017.

Not all of these laws mandate reimbursement. Some of them require that private payers pay the same for a telehealth-delivered service as for a service delivered in person.

"State Telehealth Laws and Medicaid Program Policies: A Comprehensive Scan of the 50 States and District of Columbia." Center for Connected Health Policy. Full text


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