In this episode, we are joined by T.J. Ferrante, Senior Counsel at Foley & Lardner LLP, to discuss the rapid changes to telehealth in response to the Covid-19 pandemic.
Highlights of this episode include:
- Information on the changes around telehealth in light of the recent Covid-19 pandemic.
- How CMS is working to allow expanded telehealth services.
- Why the loosening of state licensure requirements is assisting with telehealth efforts.
- How are providers being reimbursed and what provisions should they be paying attention to?
- What legal hurdles or issues should providers be aware of right now?
- And more…
Mike Passanante: Hi, this is Mike Passanante and welcome back to the award-winning Hospital Finance Podcast®. The rules and practice of telehealth have changed rapidly in response to the COVID-19 pandemic. To explain what has changed and what may come next I’m joined by Thomas T.J. Ferrante. T.J. is a Senior Counsel and a board-certified healthcare lawyer with Foley & Lardner LLP and member of the firm’s National Telemedicine and Digital Health Industry team. T.J., welcome to the show.
T.J. Ferrante: Thanks, Mike. Thank you for having me.
Mike: So why don’t you get us started, T.J.? Tell us what’s changed around telehealth in the past month.
T.J.: Sure. So the short answer is pretty much everything [laughter]. But we’ll dive into some of those details. And it’s also changing almost by the hour. So a lot of what even we talk about today or when this is aired or released could certainly change. So it’s important for anyone listening to keep updated and keep looking because this is all very fluid for now. But some of the highlights and the main things that have changed that were big show-stoppers before first and foremost came out of CMS and the Medicare program. So historically, the Medicare fee for service paid for telehealth services. But it was very, very limited. You sort of needed a perfect storm of criteria to be able to receive payment. And it was often touted or pointed to say, “Look. This is one of the reasons that telehealth really hasn’t taken off as much as it could have in the industry because of the slow movement to expand the criteria for coverage by the government.” And a lot of people would blame CMS for this. But it really wasn’t completely CMS’s fault. A lot of it was because these restrictions are located in the statutes. And the statutes can’t be changed by CMS unilaterally. It requires an act of Congress. And historically, the legislature hasn’t had the appetite to really take on that type of change.
Now, given the public health emergency that was announced earlier in March, that changed the game for a lot of those coverage requirements. What was passed was a public health law that actually amended those requirements for a period of time, those statutory requirements. And those requirements historically were– the big ones were that a patient had to be located to receive telehealth services and receive payment. The patient had to be located in a qualifying rural area. So that basically outside of a metropolitan statistical area or in a health professional shortage area. So somewhere like Manhattan obviously wouldn’t count. It’s your typical rural communities. And the patient also had to be in a qualifying originating site. And that is typically with like a doctor’s office or a hospital or a nursing home, definitely not the patient’s home in most cases. That all went by the wayside with this new law change for the waiver. And as of right now, the patient can be located anywhere and would be eligible if it’s a Medicare beneficiary for that provider to receive telehealth payment and at the same rate as if that person had come in for an in-person visit. And the policy reason for this is to really keep patients that– out of the emergency room, out the hospital system right now that is being stressed with the COVID-19 epidemic with all the testing and the treatment for those people. And so part of the policies that try to treat remotely were at whenever possible. And this is one of the tools that CMS has used by waiving the historical law.
So that’s probably one of the biggest ones I would say in the industry. I would say the other– there’s two more big ones I would highlight. The second one is less from the federal government, but more on a state-by-state basis. And that’s with respect to the licensure requirements for various healthcare professionals. So the historical rule has always been, and this is a rule in all states, that a doctor has to be licensed in the state where the patient is located at the time of a telehealth consult. So if you have a doctor that’s licensed– or located in Florida, but the patient is located in Massachusetts, at the time of the telehealth consult, that doctor in Florida also has to have a Massachusetts medical license. What has happened is a lot of the states on a state-by-state basis have started to loosen, or waive, those licensure restrictions, which has really opened up the ability for providers to practice across state lines without the burdens of having to get, in this crisis time period, additional licensure, which wouldn’t likely be able to be processed in such a short period of time. The tricky part about this is not all states have done it and not all states have done it in the same way. So you still have to very much look at each state and what their rules are. And those are changing, again, almost by the day. But a lot of it is less restricted historically. So, for example, Florida, where I sit physically, has passed a waiver, an emergency order, which would allow a number of provider types to practice telehealth in our state from other states if they’re licensed in other states. So a doctor in Texas can practice medicine in Florida via telehealth, see patients via telehealth even though that Texas doctor doesn’t have a Florida medical license. Again, the policy for this is to really streamline access to care.
The last one, the last big change I would highlight came out of the Department of Justice. So the Office of Inspector General, they’re usually charged with criminal activity, words that folks in the healthcare industry that might be familiar with such as the Anti-Kickback Statute and False Claims Act, things where you’ll see the fraudulent enforcement take place in the headlines of a newspaper. They’ve come out and said, “Look, historically, we have not encouraged, and it’s been prohibited and illegal, to waive co-pay requirements for Medicare beneficiaries,” or any federal healthcare program dollar program. And the reason historically, the policy reason for that rule is you don’t want to incentivize overutilization, or give something of value, which would be the co-pay forgiveness to a Medicare beneficiary to induce them to come to you and receive your services versus someone else, whether or not it may, or may not, be medically necessary. Given now, again, the landscape that we’re in today, the OIG has said, “Look, those services for telehealth co-payment, we want to encourage that.” So we’re going to go ahead and allow the– we’re going to use our enforcement discretion and say, “Providers, you don’t have to worry about it. You’re not going to get in trouble if that typical $20 co-pay that was required, or whatever it was, you don’t collect that, you don’t ask the Medicare beneficiaries for that. Instead, you don’t have to charge a co-pay, and the services can be provided for free to the Medicare beneficiary under that coverage.” So those were the big three ones in my opinion.
Mike: That’s great summary, T.J. And certainly, a lot of changes in a very short period of time. Do you see anything else on the near-term horizon changing? I know it’s a very fluid situation.
T.J.: Yeah. I think the biggest thing we’ll see is you’re going to continue to see these emergency orders come out states and modifications of them. So if you go just to your local state’s governor’s website or Department of Health, there’s probably several of them already. So it’s not just even one emergency order. They’re modifying them almost daily, certainly weekly. And I think we’ll continue to see the trend of tweaking the licensure requirements. I think that’s a big one. The more leeway that exists for doctors and healthcare providers of all types in other states to kind of cross state lines and provide healthcare service where it’s needed I think is important. If you look right now, states like New York, Washington they’re the ones that have the highest number of cases. So that means those local healthcare systems and hospitals are really feeling the most stress. So it makes sense, right, to have someone or providers located in a different state, just to throw them out there, maybe Oklahoma or North Dakota, I don’t know that maybe have fewer cases and have more capacity for healthcare providers to assist to be able to use telehealth and help those states, New York and Washington, even maybe not necessarily the COVID-19 patients themselves because they need more acute treatment. But the folks and citizens that live in those localities that need general healthcare treatment that may not rise to the level of acute care but still need some sort of care and can get that care virtually by doctors in another state that have that capacity and availability. So I think that’s where you’ll continue to see some movement is on a state licensure basis.
Mike: Let me dig into this a little more with you. In terms of the organizations that can offer telehealth, we think about maybe our local hospital systems and things like that, but can an individual physician do it? We’re hearing right now about physicians coming out of retirement. I mean, how do you get involved in this? What do they need to get started? And how for instance would you as a practitioner let someone in another state know that your services are available?
T.J.: Sure. So a couple of things there. So going back to the state licensure waivers a number of them have specific provisions allowing doctors to come out of retirement that may not have an active or full medical license. So I’ve seen a number of states that have that exception. So that will encourage those folks to assist where necessary. As far as some of the other things that if providers looking to help what they could do, the short answer is yes, a doctor right now can provide assistance in most jurisdictions if they’re willing to. Where there is some additional things to think about is hospitals right now are certainly first and foremost trying to deal with the influx of cases and deal with the COVID-19 patients. But at the same time they’ve been forced by many state governments or governors to no longer provide elective services which is a lot of the money making for these hospitals, right? A lot of the elective procedures is where the margin is for profitability, and so the hospitals are hurting right now. So they are still– what’s important to them is still receiving payment. And so if you’re a doctor that is not enrolled in Medicare or is not currently active, that would be something that the hospitals would want, would be looking for those physicians to do.
Fortunately, CMS has answered that problem with an interesting solution. They have actually a CMS hotline. I think if you just google CMS hotline for Medicare enrollment, it should come up. It’s literally a phone number where you can call as a provider as an individual doctor and answer some few questions and get temporary Medicare billing privileges for this period of time. And so if that’s one of the solutions to that reimbursement problem to have all these voluntary doctors come in that may or may not be enrolled in Medicare. This is one way that to quickly allow those doctors to do so, which I think is helpful.
The other thing to keep in mind, because I have a lot of questions I’ve received on this is companies that are maybe have and located in one state that have private healthcare services that want to all of the sudden jump in and use Telehealth. A lot of that is fine, and I think it works. But one thing to think about is a number of states have what’s known as a corporate practice of medicine prohibition or restriction. And about 26 states I think have that. And what that does is it prevents someone like myself who’s not a healthcare professional from owning and operating and employing healthcare providers and providing healthcare services. So a lot of big states, like Texas, New York, California, have these restrictions. And so someone that has just a general maybe healthcare company in one state, like Florida, we don’t have one. So someone like me can own a healthcare company. And I might think it’s okay to all of the sudden provide healthcare services in a state like California. I have not seen any state waive those corporate practice restrictions yet. So technically you’d want to watch out for that because that’s something to keep in mind. It’s probably not a huge enforcement priority right now, but it would still be something that you could run into some real issues if you’re not following the law.
Mike: And TJ, you mentioned reimbursement a couple times already, and I want to get into that a little bit more with you here. So providers, obviously you’ve got private payers, you’ve got the government. How are they going to go about getting reimbursed? And what changes have occurred around any sort of reimbursement provisions that they need to be paying attention to?
T.J.: Yeah. I think the government is trying to bend over backwards to really loosen the restrictions to allow providers to be able get that reimbursement that they want for these services that they’re opening up. I don’t think its governments intent to really audit or prevent payment for these. We’ll see how it shakes out once things calm down. But that’s my thought. Not only is there that hotline for individual doctors, but for actually, let’s say, you’re a physician office or an entity or some other type of provider through an entity. They’ve also streamlined that enrollment process to get you into the programs. So I think they’re guaranteeing now if you apply on their online application area, they’re going to guarantee you a response in I think about seven business days, which is much faster normal. So it’s also they’re waiving application fees, things like that. So it’s all in the spirit of trying to get folks in the program and getting payment for it.
I represent and work with a number of hospital institutions and other physician offices groups, and they started billing and have received payment for certain coins that have started pretty earlier on in the month. So I think that what we’re seeing here is an openness to get the payment out to the payment out to the providers that need it to operate their health systems. So I don’t think it’s going to be as much of a friction point. There are some nuances for hospitals or those in I think it’s part A facilities mostly. You will have to put– there’s a modifier on the bills if it’s done through this– I think it’s the CR, and it’s for this public health emergency. If you are in just a general healthcare physician providing Telehealth, there’s no special modifier. You typically put in as a place of service, place of service to, and so there’s nothing overly complex I think for those. For commercial, it’s a little bit of a different story. So there is no federal requirement or a commercial or private health plan to reimburse for a lot of this, or more specifically, to waive cost sharing in particular, that’s been the main issue. You see a number of them come out and say, “We’re going to voluntarily waive cost sharing for testing– for the actual test of the COVID-19 symptoms,” but some of it isn’t always applicable to the actual treatment of the COVID-19, or generally, other telehealth treatments. So that’s really, you have to look at it on a health plan by health plan basis. So for example, I think Aetna on their website right now is advertising that they have zero dollar copays for all telehealth visits until early June. I think BlueCross, they have about 36 independently operated BlueCross BlueShield entities, they’ve waived, I think, any cost-sharing for telehealth services, as well. So they’ve done that voluntarily, and so, if you are an individual that’s a member of a health plan, you also want to look at that. If you’re a provider or a network, you want to look at that, as well, because it will allow you to not worry about having to collect copays for those members that are in-network.
Mike: We’ve covered a lot of ground here, TJ. Are there any other legal hurdles or issues that providers should be aware of at this point? Even though obviously there’s a lot of waivers and fewer restrictions in place.
T.J.: Yeah, it’s certainly probably one of the more relaxed times, with respect to openness and loosening of regulatory hurdles, to really getting health care providers out there to provide the services that are needed. With that said, I think as a lawyer, we’re always the wet blanket; I’m always looking at the risk exposure here. And some of the things that we don’t really know how we’re going to shake out are, if someone gets hurt during this period of time and who’s going to get blamed for it. There’s always going to be, potentially, a plaintiff’s attorney that’s going to try to look for exposure areas for settlement, etc. It’s just the nature of the litigious system we live in, right? So I’d make sure that if you are jumping in to the telehealth world and you haven’t previously, to make sure that you have the malpractice coverage that would ensure that it’s going to protect you if you’re practicing medicine across state lines. And so, that means that you would like to– you should probably call your broker, make sure that you can get a rider, or that it’s already included in your policy somehow, so there’s something in writing that’s allowing you to do that. You also want to make sure that your actual insurance company itself, that is providing you with insurance, is a licensed insurer in the states that you’re going to be providing healthcare services, so that if you have a company that’s in Florida, that that company also is able to provide insurance coverage to operations that you would conduct virtually in other states, like Oregon or wherever. I think that’s a risk area that can easily be mitigated by that phone call to your broker, but it’s something that can get lost in the shuffle or overlooked, because people are eager to go help others. And what you don’t want is something to happen where all of a sudden, you’re running barren coverage in an event that you would have some exposure.
The other ones, two other points for that, I would say is on the– every state still has their telehealth practice standards, so it’s different from a licenser problem or issue. And every state has their own requirements about what type of technology you can use. So some states say that you have to do a video visit, you can’t do text messaging or phone only. And then some states have started to change those rules, a little bit. So Texas came out and changed their law so that you can just use a phone call, so you can literally– all you need is a phone call to a patient, and that’s enough to establish a doctor/patient relationship and treat those patients. So you want to look in each of the state rules there. A number of states require informed consent to receive telehealth services. And these are a lot of things that may not have been changed because of the COVID-19 pandemic, and so again, those are areas that should be looked at before jumping into the pool, I would say, in full on helping with the telehealth program.
And then the last point, I think, is again, out of excitement, a lot of clients I’m seeing that many have never done telehealth, they’re going with some of these telehealth platform companies and a lot of them great, but they’ll try to lock you in, potentially, to a one year contract, “Oh, not only are you going to need telehealth now, but you’re going to probably do it in the long term anyway. Let’s do our contract, a two year contract today,” and that’s fine, but just also make sure that you’re thinking in the long term, and that you’re not locking yourself into an arrangement that doesn’t make business sense for you after the healthcare environment rises up beyond the COVID-19 pandemic. And so, don’t just think of the here and now, but also think, if those contracts are longer term, think more of from the business side, what it might look like after. Also, it may make sense to have sort of a piloted period, shorter term relationship with those vendors, given the situation. So maybe it’s a six month contract and then it opens up the discussions to renegotiate that for a longer term period. Those are the big things I think people should keep in mind if they’re jumping into the digital health space for the first time.
Mike: Great thoughts, T.J. If someone wanted to get in touch with you or find out more about what you do, where can they go?
T.J.: Sure. First, at my firm Foley & Lardner, we have a healthcare blog, it’s called healthcarelawtoday.com, and so we write all the time about digital health issues and other various healthcare scenarios. And so I would encourage anyone to look there, there’s a lot of great content, it’s free. We try to really not hide the ball and give useful information for the readers. And if anyone wants to contact me directly, you can look me up at foley.com, my last name is Ferrante, F-E-R-R-A-N-T-E. And you can always email me at firstname.lastname@example.org directly, and my email’s listed on my firm bio as well. And happy to talk shop with anyone that has any questions.
Mike: T.J. Ferrante, thanks so much for joining us on The Hospital Finance podcast today.
T.J.: Great. Thank you, Mike.
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