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Our Take: CMS continues to boost telehealth through increased payments, expanded eligibility

May 11, 2020
CMS recently announced additional temporary waivers and rule changes designed to help ease access to care and assist providers during the pandemic. Among those changes are several that further expand telehealth services.

Of particular note is the agency’s decision to raise payments for telephone (audio only) provider visits. The previous reimbursement rates were roughly $14 to $41 per visit. The new rates, which are retroactive to March 1, range from about $46 to $110 per visit. With the increase, payments for these visits more closely match what CMS pays for similar office visits and outpatient care. In addition, the agency broadened the scope of services that are eligible for telephone visits to include behavioral health and patient education services.

CMS also expanded the potential for audio-only telehealth services by waiving the video requirement for certain telephone evaluation and management services. The goal is to make it easier for patients who don’t have access to, or prefer not to use, video technology to connect with their health care providers.

Another of CMS’ changes expands the types of practitioners who can provide Medicare telehealth services. Previously, the list of eligible providers was largely limited to physicians, nurse practitioners, and physician assistants. Now — at least for the duration of the pandemic — physical therapists, occupational therapists, and speech language pathologists also can provide and be reimbursed for telehealth services.

Further, hospitals can now bill for “partial hospitalization services” that hospital-based practitioners deliver remotely to Medicare patients in temporary expansion locations (including the patient’s home). These services include individual and group psychotherapy, as well as patient education.

Our Take: As we pointed out last week, increased usage of telehealth is one of the changes wrought by the pandemic that surely will continue after the outbreak subsides. The question is will CMS continue its support of this method of care, or will the agency roll back the temporary changes it has put in place?

Our bet is that many of the changes, if not all, will become permanent.

In a survey conducted early last month by Merritt Hawkins in collaboration with The Physicians Foundation, 48% of the physicians who responded said they were using telemedicine to treat their patients. That’s up from just 18% in a similar survey conducted two years ago.

In an article published April 28 in Internal Medicine News, Dr. Gary Price, president of The Physicians Foundation, made a strong argument supporting the persistence of telehealth beyond the pandemic. He said that physicians and patients like it, and that it saves patients travel time and time away from work. He also said it can make physician practices more efficient.

“I think we will have had a good demonstration … that it does work and that it can be accomplished without any diminishment in the quality of care that’s delivered,” Dr. Price said.

Permanently expanded use of telehealth could also help to address the shortage of physicians that already exists here in the U.S. and threatens to worsen substantially. Time pressures are often cited as one of the main factors that contribute to physician burnout. Being able to treat more patients through virtual and telephone visits could ease some of the pressure, but providers have to be adequately compensated for those visits.

CMS has taken a major step forward by increasing its reimbursement rates for audio-only provider visits and expanding the types of services that are eligible for reimbursement. We applaud the move and hope the agency will consider making these changes permanent. If and when that happens, private insurers will likely follow suit.

What else you need to know
The Trump administration is standing firm in its support of having the Affordable Care Act (ACA) struck down in its entirety, multiple news outlets reported last week. The Department of Justice had until Wednesday to file a brief with the Supreme Court if the administration wanted to amend its legal arguments in the case. Attorney General William Barr reportedly suggested earlier in the week that, in light of the pandemic, the administration should modify its stance and support the preservation of parts of the ACA, but President Donald Trump reiterated on Wednesday that he wanted to see the law completely eliminated. Should SCOTUS rule that way, up to 20 million people could lose their existing health care coverage. That doesn’t take into account the 25 million to 43 million people who could lose their employer-sponsored coverage during the COVID-19 outbreak, according to a brief by the Urban Institute. The Economic Policy Institute estimated in a recent blog post that 12.7 million people already have lost their job-based health insurance.

Molina Healthcare signed a definitive agreement to acquire Magellen Health’s managed care organization, Magellan Complete Care (MCC), for approximately $820 million. MCC serves an estimated 155,000 members in Medicare and Medicaid plans in six states and had revenue of more than $2.7 billion in 2019, Molina said in a news release. The transaction is expected to close in the first quarter of next year, though it is subject to regulatory approvals and other customary closing conditions. With the acquisition, Molina will serve more than 3.6 million members in government-sponsored health plans in 18 states. During a recent earnings call, Molina executives said the company is likely to see a “significant” increase in Medicaid and exchange members as more people lose their employer-sponsored health coverage.

Thomas Jefferson University will not be buying Fox Chase Cancer Center from Temple University as planned, the two organizations said in a joint announcement last Tuesday. They signed a definitive agreement for the acquisition last December but have decided not to complete the transaction because of the “devastating economic impact” of the pandemic. “We fully understand and accept this reality, and we look forward to identifying new ways for our institutions to work together in the future to better serve our community,” said Richard Englert, Temple University’s president.

Hoag Memorial Hospital Presbyterian is suing to end its affiliation with Providence Health. Hoag is a two-hospital system based in Newport Beach, Calif. Providence, by comparison, has 51 hospitals and 1,085 clinics throughout the western U.S. In a press statement, Hoag said it has tried to work with Providence for nearly a year to “re-align the parties in a way that guarantees Hoag’s independence,” noting that the existing relationship is not in the best interest of Hoag’s patients, physicians, and the local community. Hoag became part of the Orange County-based St. Joseph Health System in 2012, and then St. Joseph merged with Providence in 2016. Erik Wexler, chief executive of Providence’s Southern California region, said Providence is disappointed that Hoag’s leaders have filed the lawsuit and believes it is “without merit.”

Humana is waiving its Medicare Advantage members’ costs for in-network primary care, behavioral health, and telehealth visits for the rest of 2020, the insurer announced last Monday. The company had already waived out-of-pocket costs for treatment related to COVID-19, starting in March. The latest cost-share waivers took effect on May 1 and are intended to encourage members to “re-engage” with their physicians, rather than deferring care they may need. To help make office visits safer, Humana said it is sending out safety kits to members, which include masks and educational materials.

Amerisource Bergen Corp. has expressed interest in buying Walgreens Boots Alliance’s pharmaceutical wholesaling unit, Reuters reported, citing “people familiar with the matter.” Amerisource Bergen is one of the largest drug distributors in the country; according to Reuters, Walgreens owns approximately 27% of the company and is its largest customer. One of the sources reportedly said the bid for the business unit, which operates mostly under the Alliance Healthcare brand, could be as high as $6 billion.

Health Care Services Corp. (HCSC) will have a new CEO on June 1. Maurice Smith, who has been with the company for nearly 27 years and currently serves as its president, will take on the additional role of CEO at that time, according to a news release. Based in Chicago, HCSC is the parent company of Blue Cross Blue Shield plans in Illinois, Montana, New Mexico, Oklahoma, and Texas. David Lesar was selected as interim president last July; he will continue to serve on the board of directors.


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