Feds Investigating Telehealth Charges in Upsurge

Brian Owens

April 26, 2021

With telehealth restrictions eased during the COVID-19 pandemic in an effort to limit potential exposure to the virus, virtual care has become more common and the US Department of Health and Human Services (HHS) is monitoring for misuse.

In the face of the public health crisis, HHS moved quickly to expand the number of Medicare patients who could receive telehealth-delivered primary care. From February to April of 2020, telehealth for such visits jumped from 0.1% to 43.5%, and remained high even after in-person visits resumed in May.

A similar rise was seen by private insurers. "Prior to the pandemic, 15% of our ambulatory care was conducted by telephone or video. Over the past year, this grew to a peak of 80%, and remains at nearly 48% after the most recent surges," says Lisa Caplan, senior vice president of care delivery technology services for Kaiser Permanente.

One pattern in the Medicare data has already drawn the attention of the Office of Inspector General. From the beginning of March to the end of July 2020, clinicians were billing Medicare telehealth visits at higher levels of complexity than in-person ones, according to a preliminary analysis presented in a briefing to Congress. For new patients, 22% of telehealth visits were billed at the highest complexity level, compared with 16% for in-person visits.

That doesn't necessarily mean there is widespread fraud, says Chris Schrank, assistant inspector general for investigations. There could be legitimate reasons for telehealth visits to be more complex; it might just be more complicated and time-consuming, in general, to conduct a medical appointment virtually.

But this is something that will be closely monitored. "We're trying to understand a lot of the issues that might occur," says Schrank.

Telehealth is sometimes the source of fraud schemes, with telemarketing being used to set up sham virtual doctor visits for patients, which can lead to unnecessary genetic testing or medical devices being ordered. In such cases, the scammers rarely bill for the telehealth visits — so it is not technically telehealth fraud — but the visits are used as a cover to order and bill for the unnecessary services.

In recent years, there have been several large investigations of this kind of fraud. In September 2020, an investigation referred to as Operation Rubber Stamp resulted in the Department of Justice's largest ever healthcare fraud enforcement, involving more than $6 billion in fraudulent claims, $4.5 billion of which was related to telemedicine.

"It definitely gives people already involved in fraud more options," says Matthew Sitton, a healthcare lawyer with Butler Snow, a law firm in Jackson, Mississippi. "We might see more sophisticated schemes over time trying to use telehealth to give them more legitimacy."

Bogus Doctor Visits, Unnecessary Tests

But despite the risk for fraud, the expansion of telehealth is likely to continue. It has proven extremely popular with patients, says Caplan. "Data show that our patients are embracing the choice and convenience telehealth brings," she says.

A recent survey showed that 89% of Kaiser Permanente members who completed a video visit were interested in a future video visit, and 87% said the video visit was more convenient than other methods of getting care.

Continuity of care, which is known to improve health outcomes, is significantly better with telehealth than with in-person visits, says Shira Hollander, senior associate director of policy development at the American Hospital Association.

"The rise in telehealth radically changed that equation. Missed or cancelled appointments dropped significantly," she reports. "So you can stay connected to your provider without having to give up something else in your life that is equally necessary." The expansion of telehealth has also improved access to healthcare for people who do not have primary care physicians. "It can pull people out of the woodwork," she explains.

The expansion of telehealth under Medicare was made possible by emergency legislation that waived many of the restrictions. Previously, patients in rural areas could chat virtually with a specialist or doctor located elsewhere, but only from a clinic or doctor's office.

Significant changes now allow people outside of rural areas to access telehealth, audio-only visits, and telehealth visits from their home, says Hollander.

"We would like to see a lot of the changes made permanent or extended" once the public health emergency ends, she says. The American Hospital Association is among the organizations calling on Congress to pass laws that maintain the eased restrictions.

The Office of Inspector General recognizes that telehealth can improve efficiency, convenience, and access to medical care, and health teams have been given extra flexibility to provide it during the pandemic, Schrank says.

The agency will continue to monitor for telehealth fraud with sophisticated data-analysis systems, but Schrank urges patients and healthcare providers to report potential problems.

"Our best information comes from those who are involved in the healthcare system every day," he says. "That real-time information is critical."

Brian Owens is a freelance science journalist who has filed for Nature, New Scientist and the Lancet. He won a National Magazine Award for best news story for an article in the Canadian Medical Association Journal.

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