Top Ten (+1) Telemedicine Reimbursement Questions

At VisuWell, we have telemedicine reimbursement guides and in-depth information categorized by specialty.  After extensive research, we have found a few questions that linger amongst providers and can hinder telemedicine adoption.  Our Top Ten (+1) Telemedicine Reimbursement Questions will help you navigate the complex reimbursement terrain.

1. What is telemedicine parity?

Telemedicine parity is the process of payers offering reimbursement and/or coverage for telemedicine services equal to in-person services.  There are two types of parity – service/coverage parity and payment parity.

  • Payment Parity requires reimbursement for telemedicine services equal to similar services that would be provided through in-person care.
  • Service/Coverage Parity requires an insurance provider to cover telemedicine services provided to beneficiaries.  Typical language prevents co-payments, co-insurance, and other fees from exceeding potential charges for an in-person visit.
2. Can FQHCs and/or RHC be distant sites?

Depends on the payer – for Medicare, no, and for Medicaid, yes – depending on the state.  This is due to classifications for Medicare and Medicaid, which is expanded upon in our FQHC and RHC Guide.  You can also find information concerning Medicaid originating site reimbursement in each state’s Medicaid manual or under the state’s administrative code governing Medicaid.

3. How do telemedicine services operate if I live near a state border?

The ability to practice telemedicine in a state is dependent on licensure within each state.  It is presumed providers are licensed in their state of residence; therefore, they can practice within that state.  To expand their client base, it would be beneficial for providers living near a state border to obtain dual-state licensure.

4. How does telemedicine reimbursement differ between Medicare and Medicaid?

Medicare reimbursement is the payment that hospitals and providers receive based on services provided to Medicare-covered patients.  As it operates as an insurance program funded through the Federal Government, reimbursement rates, service fees, etc. are applied across the country with no state differentiation.  As a federal program serving seniors, objectives, and goals are targeted towards this demographic. Currently, Medicare reimburses only for qualified services delivered via live video. Store-and-forward services are only permissible for CMS demonstration programs in Alaska and Hawaii.  Learn more from the Medicare section in VisuWell’s Telemedicine Reimbursement Guide.

Medicaid, however, operates as a state-level program that makes payments through a fee-for-service agreement or pre-payment agreements.  Providers are reimbursed for their portion share of expenditures through the Federal Medical Assistance Percentage, determined annually and dependent on each states’ per capita income level.  For telemedicine services, states allocate reimbursement laws based on historical need and budget allowances, hence the specific state variations. As Medicaid codes can vary by state, take note of specific telemedicine modifiers and variations.  You can access this information in VisuWell’s State-by-State Reimbursement Resource.

5. What telemedicine services can I get reimbursed for?

Overall, reimbursement for telemedicine services is dependent on the payer and state regulations.  Typically, live video/synchronous communication is considered a universally accepted means of telemedicine.  Remote patient monitoring and store-and-forward are other accepted means of telemedicine, but not completely accepted by Medicare nor for every state, specialty, and circumstance.  Telephone (non-face-to-face) conversations are normally not reimbursable, although recent legislation has opened up the option for Home Health Agencies.

6. Why do my reimbursement claims continue to get rejected?

A big issue we see in reimbursement is fear of rejection.  If a claim gets rejected once, many providers don’t try again and believe they aren’t able to utilize telemedicine.  Most of the time, however, the rejection is due to a simple code error, patient and provider location classifications, lack of appropriate modifiers, or other minor claim issues.  Medicare and Medicaid, as government programs, are required to reject claims that aren’t completely correct, so, unfortunately, if a claim is not perfect, it will get rejected. If you think your claim is correct, but your efforts continuously are rejected, the best way to find out the reason why is it to call and ask.

7. What modifiers are used for telemedicine?
  • GT Modifier – is commonly used to designate synchronous video or telemedicine delivered via two-way video conferencing.
  • GQ Modifier – references asynchronous communication or store-and-forward
  • POS Code – 02 – a new place of service code for telemedicine, 02 increasing in popularity, as many insurers are moving away from other modifiers.
8. Is the home an eligible originating site?

In some cases, yes.  Medicare is expanding the conditions for the home to be an eligible originating site, such as substance abuse and end-stage renal disease.  There are a few states allowing for the home to be an originating site, for private payors and Medicaid example, but that is dependent on the state’s regulations.  Additionally, pending legislation targeting Home Health Agencies allows the home to be billed as an originating site for multiple payors going forward.

9. Do reimbursement rules differ between states?

Yes.  Medicare is the only payor with continuous reimbursement rules across the country, due to its status as a federally-funded and federally-dispersed program.  Reimbursement allowances for Medicaid, alongside private payors, will vary by state. For further details concerning reimbursement in your state, consult the VisuWell State Reimbursement Map.

10. Is my practice too small for a telemedicine practice?

No.  With the ability to expand resources, increase access, and reduce administrative workloads, smaller practices ultimately save time and money.  Resources can be maximized through telemedicine solutions in both large and small practices.

11. Does reimbursement justify launching a virtual care strategy?

Absolutely, yes.  While the benefits of a virtual care strategy vary across a breadth of factors, the reimbursement opportunities for telemedicine are only expanding.  Even when reimbursement doesn’t exist for large segments of a population, you can still offer telemedicine and charge a direct-pay convenience fee.

Telemedicine is not a modality dwindling in popularity.  Launching a virtual care strategy now will ensure heightened market advantages when reimbursement is universal across states and payors.  Newer cloud-based solutions like VisuWell, offer significant cost advantages over earlier hardware-based solutions offered through Polycom and Cisco.  Today startup costs are simply not a significant barrier.