Congress just took action on technology-enabled Medicare reforms

Congress just took action on technology-enabled Medicare reforms
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You may not have noticed, for all the cable news talk of memos, shutdowns, and the like, but last week Congress took a quiet but meaningful leap forward in fundamentally reimagining how we deliver care to our nation’s 59 million Medicare beneficiaries.

The advent of telehealth has brought the doctor’s office into living rooms and bedsides around the country, saving lives and offering peace of mind to vulnerable patients along the way, but a quarter century after the “telemedicine renaissance” of the 1990s, the nation’s largest healthcare payer has been slow to embrace this tool — until now.

Buried in the 650-page Bipartisan Budget Act passed on Friday were the most significant reforms recognizing the role of telehealth in care delivery since the Consolidated Appropriations Act of 2001, when Medicare was first required to begin reimbursement for telehealth services under a narrow set of circumstances.

Among the provisions in the bill passed last week are landmark changes to facilitate telehealth in Medicare Advantage plans where 19 million seniors, or 33 percent of beneficiaries, get their care. In addition, the bill provides nationwide access to stroke telemedicine (also known as “telestroke”) and improve access to telehealth-enabled home dialysis therapy among Medicare beneficiaries, among other reforms.

With the president’s signature, Medicare will finally begin its ascent into the 21st century, allowing beneficiaries to leverage the technology of today to manage their wellbeing tomorrow.

While some may see the telehealth provisions in this bill as more piecemeal tweaks to a faulty system, we at Health IT Now — a coalition of patient groups, provider organizations, employers, and payers fighting for the full integration of technology in healthcare — believe these are promising steps towards broader reforms.

Past legislative approaches have been laser-focused on telehealth instead of aligning incentives to promote better quality care, no matter how it is delivered. The answer is not to shoehorn telehealth into an outdated benefit design, but rather to construct new payment models that support innovative approaches to care delivery in all its forms — telehealth being among them.

We know that Medicare is falling behind almost every other payer in reimbursement for telehealth services. One could say that the “golden rule” of health care policy — “As goes Medicare, so goes the nation” — is proven false when it comes to the adoption of technology-enabled care.

After all, in 2016, Medicare spent an anemic $28.75 million out of a $646 billion budget, or less than 1 percent, on services delivered via telehealth. Meanwhile, the Department of Veterans Affairs is expanding their telehealth offerings with their “anywhere-to-anywhere” health care program; the Office of Personnel Management is encouraging Federal Employees Health Benefits Program carriers to leverage telehealth; state Medicaid plans continue to find innovative ways to deliver care via technology; and surveys indicate that 96 percent of large employers will make telehealth services available.

So how did Medicare get stuck so far in the past?

First, Medicare has been legally barred from expanding telehealth reimbursement past the parameters set in the Consolidated Appropriations Act of 2001. For example, the law stipulated that, for a provider to be reimbursed for telehealth services, patients had to reside in designated rural areas, typically with a shortage of healthcare providers, or be part of a federal demonstration program. The law also requires beneficiaries to travel to a health facility to utilize telehealth services instead of allowing access in their homes. Only now has Congress begun to loosen these restrictions.

Second, Medicare’s fee-for-service system is not equipped to handle technology’s ability to improve access to care.

Lawmakers know the transformative potential of telehealth but, in the past, have been spooked by high cost estimates from the Congressional Budget Office (CBO). The scorekeepers have identified telehealth expansion efforts under the fee-for-service structure as adding new ways for providers to bill for more services more easily, thus resulting in more usage and more costs to the program. They’re not wrong — but the problem lies with the system, not the technology.

Broader use of telehealth could be a cost-effective option for Medicare if lawmakers look outside of the fee-for-service model and instead seek to reward outcomes over quantity. In other words, realign incentives to encourage providers to view new technologies as an opportunity to change the delivery of an existing service based on what works best for the patient — not an opportunity to simply bill for both in-person and telehealth visits.

Congress finally got the equation right in the budget deal that was passed last week. The most sweeping change is outside of fee-for-service Medicare altogether: allowing Medicare Advantage plans to offer telehealth services as a basic benefit for the first time.

While these reforms are welcome, it is important to note that most Medicare beneficiaries still lack the ability to access care when and where they need it with the help of technology.

Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma acknowledged as much last week when she doubled down — telling conference attendees in Washington D.C. “You’re going to see a lot more from us … we’re going to be focusing on how we can leverage technology to improve access to care.”

Let’s hope she’s right.

Enactment of these latest reforms must not be the finish line, but rather another mile marker in the longer race towards a modernized Medicare that keeps it promises to beneficiaries, both now and in the future.

At Health IT Now, we’re ready to do our part, and we are hopeful that — on behalf of the 59 million Americans counting on us all to get it right — leaders in Washington will do theirs.

Catherine Pugh is the Senior Director of Government Affairs for Health IT Now, a broad-based coalition of patient groups, provider organizations, employers, and payers supporting health information technology to improve patient outcomes. Learn more at