Medicaid and Telemedicine
Telemedicine is generally described as the use of communication equipment to link health care practitioners and patients in different locations. This technology is used by health care providers for many reasons, including increased cost efficiency, reduced transportation expenses, improved patient access to specialists and mental health providers, improved quality of care, and better communication among providers.
The Health Care Financing Administration has not formally defined telemedicine for the Medicaid program, and Federal Medicaid law does not recognize telemedicine as a distinct service. Nevertheless, Medicaid reimbursement for services furnished through telemedicine applications is available, at the State's option, as a cost-effective alternative to the more traditional ways of providing medical care (e.g., face-to-face consultations or examinations). As described below, at least eighteen states are allowing reimbursement for services provided via telemedicine for reasons which include improved access to specialists for rural communities and reduced transportation costs.
When deciding the scope of coverage for telemedicine applications, States should consider factors such as the quality of equipment, type of services to be provided, and location of providers (e.g., remote rural sites). Most states that provide payment for services furnished using telemedicine technology do so in the form of a physician consultation. Non-physician practitioners may also be covered depending on their scope of practice under state law. [Teleradiology is assumed to be covered by all 50 States because of its prevalent use in many Radiology practices.]
Federal Medicaid guidelines require all providers to practice within the scope of their state practice act. Some states have enacted legislation which requires providers using telemedicine technology across state lines to have a valid state license in the state where the patient is located. Any such requirements or restrictions placed by the state are binding under current Medicaid rules. Medicare Conditions of Participation (COPs) applicable to settings such as long term care facilities, and hospitals may also impact reimbursement for services provided via telemedicine technology. For instance, the Medicare COPs for long term care facilities require physician visits at set intervals. Current regulations require that the physician must be physicially present in the same room as the patient during the visit. This requirement must also be met for Medicaid to pay for services provided to Medicaid eligible patients while in a Medicare or Medicaid certified facility. Similarly,Federal regulations require face-to-face visits for home health, and telemedicine cannot be used as a substitute for those visits. However, a telemedicine encounter may be used as a supplement to the required face-to-face visits.
Reimbursement for Medicaid-covered services, including those with telemedicine applications, also must satisfy Federal requirements of efficiency, economy, and quality of care. With this in mind, States are encouraged to use the flexibility inherent in Federal law to create innovative payment methodologies for services that incorporate telemedicine technology. For example, states covering medical services that utilize telemedicine may reimburse for both the provider at the hub site for the consultation, and the provider at the spoke site for an office visit. States also have the flexibility to reimburse any additional cost (i.e., technical support, line-charges, depreciation on equipment, etc.) associated with the delivery of a covered service by electronic means as long as the payment is consistent with the requirements of efficiency, economy, and quality of care. These add-on costs can be incorporated into the fee-for-service rates or separately reimbursed as an administrative cost by the State. If they are separately billed and reimbursed, the costs must be linked to a covered Medicaid service.
In terms of medical codes used as a basis for identifying, tracking and reimbursing for telemedicine, some states use modifiers to the existing Physicians' Current Procedural Terminology (CPT) codes. The modifiers "TM" and "TV" are commonly used to make this distinction. Other States have developed their own local codes to distinguish telemedicine services.
At this point, Medicaid reimbursement (fee for service) for services provided via telemedicine is available in the following States: Arkansas, California, Georgia, Iowa, Illinois, Kansas, Louisiana, Minnesota, Montana, Nebraska, North Carolina, North Dakota, Oklahoma, South Dakota, Texas, Utah, Virginia, and West Virginia. In addition, two states, Kentucky and Maine, are developing plans to cover telemedicine. For a brief description of the states' telemedicine programs.
Contacts:
David Greenberg, (410) 786-2637 or E-mail dgreenberg@cms.hhs.gov.
Dr. Jerry Zelinger, (410) 786-5929 or E-mail gzelinger@cms.hhs.gov.
