Report shows 'vast improvement' in state telehealth reimbursement policies

The report by Foley & Lardner found that 43 states and D.C. have implemented a version of a state telehealth commercial payer law – although payment parity policies lag behind.
By Kat Jercich
02:42 PM
A woman looks at a medication bottle with a person onscreen.

A report released Tuesday by Foley & Lardner LLP found that the COVID-19 pandemic compelled state and federal policymakers to remove restrictions on and expand reimbursement for telehealth and virtual care at unprecedented rates.

The firm, which monitors legal policy in the telemedicine and digital health industry, reported that 43 states and the District of Columbia implemented a version of a state telehealth commercial payer law – and the experts believe this year will trigger even greater expansion.

"Health plans are offering more telemedicine and digital health coverage as part of a broader acceptance of virtual care; changes we believe will largely remain even after the Public Health Emergency ends," said Nathaniel Lacktman, partner and chair of the firm’s national telemedicine and digital health industry team, in a statement.

"The public health emergency did not create the telemedicine industry. It simply accelerated its inevitable growth," Lacktman added.  


The wide-ranging report – which focuses only on commercial health insurance laws, and not Medicaid rules – notes that, although telehealth coverage has widely expanded, not all of these laws are equally effective at ensuring access to virtual care.  

For instance, Florida, Illinois and Michigan have telehealth coverage laws on the books that do not actually mandate health plans to cover virtual services.  

The report authors also note that only 14 states require true "payment parity" for telehealth, meaning that providers who are not based in Arkansas, California, Delaware, Georgia, Hawaii, Kentucky, Minnesota, Missouri, New Mexico, Texas, Utah, Vermont, Virginia or Washington may receive lower reimbursement rates for telehealth-based care.  

Massachusetts' new law also offers payment parity, but only for behavioral health services. Despite other limitations on commercial insurance reimbursement, "the trend is towards equitable treatment for telehealth," reads the report.  

Tennessee is the only state that maintains restrictions on the patient's originating site (a largely unpopular policy across partisan lines). Thirty states also have protections against plans charging a payment more for a telehealth consultation than for the same service in person.  

Coverage of remote patient monitoring and asynchronous telehealth has also grown, with patients and providers continuing to push for these kinds of services – particularly as the COVID-19 pandemic motivates individuals to try to avoid in-person healthcare settings.  

More than half of states mandate coverage for asynchronous telehealth, also known as "store and forward" services, and 17 require commercial health plans to cover remote monitoring services.  

"These laws benefit patients by increasing access and availability to health care services, and catalyze the growth of telehealth technologies throughout the country," the report reads.  


Back in June, Lacktman told Healthcare IT News that the reimbursement models then in place made it harder for smaller practices to implement telehealth practices, and that the future of telehealth longevity depended largely on state and federal policies.  

Experts point to the states as forging the path, with more than 300 bills at play in state legislatures aimed at expanding access to telehealth. Governors and state agencies can also take steps to safeguard virtual care.   

"Telehealth has the potential to increase access to care, particularly for individuals in rural and underserved areas, as well as during a time when the nation is encouraged to physically distance," said the authors of a National Governors Association white paper released in December.


"Telemedicine and digital health care [have] played a critical role during COVID by allowing providers to safely deliver medical care when and where patients need it, whether urban or rural locations,” said Jacqueline Acosta, special counsel and one of the Foley report’s authors.

"While many legal and regulatory complexities across 50 states can create barriers to entry, the temporary waivers have allowed providers to deliver care in new and different ways, which may lead to blazing new digitized care pathways in the coming years," Acosta added.


Kat Jercich is senior editor of Healthcare IT News.
Twitter: @kjercich
Healthcare IT News is a HIMSS Media publication.

Want to get more stories like this one? Get daily news updates from Healthcare IT News.
Your subscription has been saved.
Something went wrong. Please try again.