Telemedicine is growing rapidly and changing the healthcare landscape for the better. With many patients embracing the benefits of remote care, the practitioners are looking for ways to incorporate telehealth services into their practice. We are witnessing the continual rise of telemedicine-only practices as well.
The utilization of telemedicine services depends on the reimbursement policy a lot. States with progressive reimbursement policies have much more telehealth recipients. With the healthcare system struggling to stay afloat, telemedicine proved to help release the pressure off hospitals and acute care units. In light of the COVID-19 pandemic, this may make a difference between an efficient response to the national health crisis and a complete collapse.
What Telemedicine Services Qualify for Reimbursement?
Defined as delivery of healthcare through the use of digital communication channels and technology, telemedicine is a broad term that includes many services. The practitioner and the patient are in remote sites. The location of the patient is called the originating site, while the physician’s location is called the distant site.
With the development of digital technology, the possibilities to deliver remote care are continually expanding.
There are many ways to practice telehealth. Not all of them will qualify as valid healthcare services, or to be more precise, not all of them will qualify for reimbursement. Live telemedicine and store-and-forward are usually covered by insurers, while mobile health and remote patient monitoring are not.
For the detailed overview, check the table below.
Type of Service
Live Video Calls
A real-time video chat between a health provider and a patient
A medical consultation through a two-way video communication channel
Using electronic communication channels to transmit the recorded health history (both digital images and documents)
A physician sending scans, blood test results, photos of skin conditions to a specialist for evaluation
Depending on the state
Remote Patient Monitoring
Transmitting medical data collected by the patient to a doctor in a remote location
A patient wearing Wi-Fi or Bluetooth-enabled devices that report on an activity (e.g., heart rate)
Depending on the state and diagnosis
Utilizing mobile devices (phones and tablets) for medical purposes
A patient receiving notifications regarding appointments or reminders about when to take medication
Telehealth Reimbursement Laws
Telemedicine legislation tends to be complicated, and it varies significantly from state to state. Since the originating site is the place where the virtual visit takes place, the laws of the patient’s residing state apply. Regardless of their location, practitioners are obliged to have a license to practice medicine at the location of the recipient.
This proved to be tricky because each state issues its medical license. The Interstate Medical Licensure Compact (IMLC) has been helpful with cutting through the red tape in obtaining cross-state licenses. Not all states joined the program, unfortunately, so getting the necessary permits can be a tiresome process.
Reimbursement is not less intricate. The first thing to understand is that there are two types of parity:
- Coverage parity implies that the patient gets coverage for telemedicine and in-person practice for the same indication
- Payment parity means that the same fees apply to both models of practice
When it comes to reimbursement, it is essential to understand the legislation of the originating site. Various insurance plans have different regulations in each state, meaning the private payers, Medicare, and Medicaid do not have a uniformed policy on the federal level.
Federal Telemedicine Laws
The scope of federal telehealth legislation is limited. The primary focus is on specific health crises or emergencies rather than the introduction of this model on a larger scale. State-federal partnerships like Medicaid and Medicare are the center of attention, but their practicing agencies depend on the state laws regarding reimbursement policies.
The coronavirus outbreak shook the system, and there are many interstate initiatives to improve the laws on the federal level. The public health crisis demands a unified approach to this emergency.
State Telemedicine Laws
Two issues influenced the legislation of telehealth in each state:
- The geographic location
- The availability of medical professionals
It seems that the states with larger rural regions or the higher number of residents living in remote locations have a more liberal approach in regulating telemedicine. The shortage of medical professionals also plays a significant role in the decision-making process.
Even the states that allow and support remote care impose limitations on various aspects of telehealth. These restrictions usually apply to:
- The originating site
- The type of service
- The healthcare provider
Depending on the insurer, the limitations may vary in the same jurisdictions. Medicaid and private payers may interpret the laws differently, so the practitioners should get familiar with the regulations thoroughly. You can check the details here.
Eligible Originating Site
Although one would assume that the patient’s home would be the most logical originating site for telemedicine, that is not always the case. Many state laws impose restrictions on the place of the virtual visit.
The eligible originating site is often a medical facility that is the closest to the patient’s home. Some states require the place to be staffed with medical professionals to qualify as the originating site.
Limitations can sometimes apply to the region as well. Only patients from rural or remote areas are allowed to enjoy the benefits of telemedicine in some parts of the U.S.
Eligible Types of Service
In some states, only specific telehealth services are allowed. What type of service will be eligible usually depends on the assessment of the appropriate medical authority. They will determine what is suitable or safe for telemedicine and what is not.
Some medical officials still view telehealth as an unfit model of practice for specific conditions. It is vital to understand the rules and regulations that apply to the originating site and to comply with them. Telemedicine providers are subject to the same disciplinary measures as traditional healthcare professionals, so you must make sure you are not violating any state or federal laws.
Which providers are fit for telemedicine mostly depends on the shortage of medical personnel in a specific state. In remote areas, almost all providers are allowed to practice telehealth. Specialists, especially the ones with expertise in rare diseases, are welcome to practice virtually without limitations.
The exception to the rule is peer-to-peer consultation as well. A physician can participate in the treatment of the patient, even if they are not an eligible provider, if the primary doctor is eligible and present during the virtual visits.
Reimbursement Policies State by State
With strict and somewhat complicated legislation, telemedicine reimbursement policies can be quite confusing. Let’s check the situation in each state. You can find additional information at the American Telemedicine Association state policy center.
Alabama enacted a partial parity law in 2016. Medicaid covers for live video telehealth, while the private payers are not obliged to cover for telemedicine, although they can still choose to include it in their insurance plans. Alabama-based physicians can practice out-of-state because the state is a member of IMLC.
Read more about Alabama telemedicine.
Even though Alaska does not have a parity law in place, Medicaid covers a wide range of services there. Private payers can cover telehealth at their discretion. They are obliged to cover mental health services.
Private payers are mandated to cover for telemedicine only in rural areas of Arizona. With the new law taking off in 2021, it seems that the reimbursement will expand. Arizona Medicaid covers a broader range of services although some restrictions apply to the type of service and eligible originating sites.
Read more about Arizona telemedicine.
Arkansas adopted a complete parity law in 2015. Some restrictions apply to the originating site, and there are specific requirements for establishing a doctor-patient relationship. The state is yet to join IMLC.
Read more about Arkansas telemedicine.
With the parity law in place since 1996, California was one of the first states to embrace and use all the advantages of telemedicine. Both private insurers and Medicaid are mandated to cover for telehealth though certain restrictions may apply. The state is not a member of IMLC.
Read more about California telemedicine.
Colorado has one of the most progressive telemedicine laws in the States. There are no location restrictions, and both Medicaid and private payers are mandated to cover for telemedicine in the same way they would for traditional practice. The state has joined IMLC.
Read more about Colorado telemedicine.
Although it is not a member of IMLC, Connecticut has a parity law in place that requires Medicaid and private insurers to reimburse for telehealth. Medicaid is required to cove for both live telemedicine and store-and-forward.
Delaware officials adopted the parity law, and private payers and Medicaid reimbursement for live telemedicine is obligatory. The state has yet to join IMLC and expand the coverage to other aspects of telehealth.
Florida Medicaid covers for live telemedicine, although there is no parity law in place. Although private payers are not obliged to reimburse for remote care, most of the insurers include telehealth into their plans.
Read more about Florida telemedicine.
Georgia adopted the parity law, and both Medicaid and private payers cover telemedicine. Georgia Medicaid reimburses for live telemedicine and store-and-forward. The state is a member of IMLC, so the physicians can practice over state lines.
Read more about Georgia telemedicine.
With many of its residents living on remote islands, Hawaii has a progressive telehealth policy. The law mandates that Medicaid and private payers cover telemedicine in the same way they do in-person practice. The state hasn’t joined IMLC yet.
Read more about telemedicine in Hawaii.
Idaho is a little behind with regulating the telehealth practice. Although Medicaid covers live telemedicine, the state does not have a parity law in place. Idaho is a member of IMLC, so the physicians can practice in other participating states.
Read more about telemedicine in Idaho.
Medicaid and private payers must cover telehealth according to the Illinois parity law. Remote patient monitoring is included in the coverage by Medicaid, although some limitations may apply. The state participates in the IMLC program.
Read more about Illinois telemedicine.
Indiana has a full parity law. Private payers and Medicaid both reimburse for telemedicine, with Medicaid covering remote patient monitoring as well. Indiana is still not a member of the Interstate Medical Licensure Compact.
Read more about Indiana telemedicine.
The Iowa telemedicine law ensures complete parity as of 2019. Iowa officials accepted telehealth, and so did the patients. The state is also a member of IMLC, so Iowa-based medical professionals can offer their services to patients in other states that participate in the program.
The payers can establish their own reimbursement rules in Kansas, although there is a valid parity law in the state. The policies depend on the insurer, so practicing telehealth can be confusing. The state joined IMLC, so the practitioners can benefit from treating patients outside Kansas.
With progressive telemedicine reimbursement policy, Kentucky is one of the leaders in the U.S. As of 2019, the patient’s home is on the list of eligible originating sites. Kentucky is a member of IMLC.
The parity law imposes some restrictions on telemedicine coverage in Louisiana, mostly regarding the healthcare providers. Medicaid does cover live telehealth and remote patient monitoring, but the state did not join IMLC.
Read more about telemedicine in Louisiana.
American Telemedicine Association gave Maine a perfect grade because the state has a complete parity law and precise guidelines on how to practice telehealth. Maine joined IMLC, and it continually upgrades its policies.
Maryland is also one of the states with full parity law in place. Medicaid and private payers reimburse for telemedicine in the same way they would for traditional practice. By joining IMLC, the state enabled Maine practitioners to offer their services across state lines.
Read more about Maryland telemedicine.
Medicaid does cover telemedicine services in Massachusetts, but there is no parity law in the state. Massachusetts needs to work on its telehealth policies since the state did not join IMLC.
Read more about telemedicine in Massachusetts.
Since the state removed most of the restrictions regarding the geographic locations, Michigan is on the right track with telehealth. The parity laws mandate reimbursement to Medicaid and private payers, and the state is the member of IMLC.
Read more about telemedicine in Michigan.
Minnesota is one of the leaders in telehealth. Both private payers and Medicaid cover telemedicine services. Even dental plans are included, which is a rare case. The state participates in the IMLC program as well.
Read more about Minnesota telemedicine.
The shortage of physicians is the reason for a progressive telemedicine policy in Mississippi. With full parity law, Mississippi seems to be dealing with the problem much better. Private payers and Medicaid reimburse for telehealth in the same way they do for traditional practice, and the state is a member of IMLC.
By expanding the coverage on home settings, Missouri pushed telemedicine in the right direction. The parity law requires reimbursement for telehealth services from private payers and Medicaid. Missouri is still not a member of the Interstate Medical Licensure Compact.
Read more about Missouri telemedicine.
Private payers are mandated to cover for telehealth in Montana. Medicaid is also on board, but with a couple of restrictions. The state has a parity law in place and has a progressive telemedicine policy. Montana participates in IMLC.
Nebraska changed its telemedicine policy in 2017. The state adopted a full parity law, mandating Medicaid and private payers to reimburse for telehealth services. In the same year, Nebraska joined IMLC.
The complete parity law is in place in Nevada, and the state got rid of several arbitrary limitations that restricted the development of telemedicine. Insurers cover a wide range of telehealth services, and Nevada became an IMLC member as well.
Private payers cover telehealth in New Hampshire, but Medicaid’s reimbursement is restricted to certain services. The state did join IMLC, and many telemedicine providers from New Hampshire benefit from practicing in other member states.
While private payers are obliged to reimburse for telemedicine, New Jersey Medicaid only covers telepsychiatry. We hope that it will update its policy soon. The state is not a member of IMLC, which makes it harder for the providers to practice across state lines.
Read more about telemedicine in New Jersey.
New Mexico has one of the most progressive telemedicine policies in the country. With complete parity law and full overage by all insurers, both the providers and recipients benefit immensely from telehealth. New Mexico is yet to join IMLC to make the cross-state licensing easier for the practitioners.
After the introduction of the complete parity law, private insurers are mandated to cover telemedicine in New York. Medicaid expanded its coverage as well, so the state has a progressive policy and comprehensive guidelines on how to practice telehealth. New York did not join IMLC.
Read more about telemedicine in New York.
North Carolina officials are yet to realize the benefits of telemedicine. There is no parity law, and the providers depend on direct payments, which is not stimulating. The only exception is telepsychiatry. Medicaid covers live telemedicine, but previous approvals are required.
Read more about telemedicine in North Carolina.
Private payers and Medicaid reimburse live telemedicine in North Dakota. The state jumped the bandwagon and continues to support telehealth. North Dakota became a member of the Interstate Medical Licensure Compact.
Ohio does not have a full parity law, but the practice is booming in the state, especially when it comes to telepsychiatry and behavioral therapy. Although the state is not a member of IMLC, Ohio has a liberal policy on licensing for practicing telemedicine.
Read more about Ohio telemedicine.
Oklahoma has a progressive telemedicine policy, and private payers and Medicaid reimburse for the services according to the parity law. The state even has a no-fee policy for telehealth in non-profit hospitals. Oklahoma is participating in the IMLC program.
Practitioners in Oregon can be reimbursed for telemedicine services provided via email or telephone, which is uncommon. The progressive policy requires coverage from both Medicaid and private insurers. The state is not a member of IMLC, unfortunately.
Read more about Oregon telemedicine.
Pennsylvania is still to adopt a complete parity law and join IMLC. Medicaid beneficiaries can use live telemedicine services, while the coverage by private payers is not mandatory.
Read more about telemedicine in Pennsylvania.
Practicing telemedicine is no longer complicated in Rhode Island with a complete parity law in place. Medicaid and private insurers are mandated to reimburse for telehealth. We are still waiting for the state to become a member of IMLC.
South Carolina is one of the leaders in telepsychiatry in the U.S. Other aspects of telehealth are not looking so good without an existing parity law. Medicaid does reimburse for live telemedicine. South Carolina has not yet joined IMLC.
Read more about telemedicine in South Carolina.
With restrictions on the patient’s location and the types of services covered by Medicaid, South Dakota has a long way to go when it comes to telemedicine. The parity law would resolve many of the issues. The state is participating in IMLC.
Tennessee’s parity law mandates coverage for telemedicine to Medicaid and private payers. With no location restrictions, the state is one of the leaders in telehealth. Tennessee has set an excellent example by joining IMLC.
Read more about Tennessee telemedicine.
The shortage of medical professionals in Texas accelerated the liberalization of telemedicine policies. The parity law requires reimbursement from Medicaid and private payers in the same way as in traditional practice. By joining IMLC, Texas would become the leader in telemedicine.
Read more about telemedicine in Texas.
There is no current parity telemedicine law in Utah. The state is a member of IMLC, and Medicaid reimburses for live telehealth services.
Vermont keeps improving its telemedicine policy. The state has a full parity law that requires coverage from private insurers and Medicaid. Vermont is participating in IMLC and continues to lead the way in expanding telehealth services.
Virginia enacted a parity law, so all insurers must cover telemedicine. Some restrictions apply, so the policy could use a bit of refining, but the state officials are making progress in liberating telehealth. Virginia is still not a member of IMLC.
Read more about telemedicine in Virginia.
Complete parity law enabled the expansion of telemedicine in Washington State. The practitioners get reimbursement from both Medicaid and private insurers. Washington joined IMLC, so cross-state licensing became much easier.
Read more about telemedicine in Washington.
Medicaid in West Virginia covers live telemedicine for patients in rural areas, but there is no comprehensive parity law in the state. By joining IMLC, West Virginia is starting to develop and expand its telehealth policy.
Wisconsin has no active parity law, but after joining IMLC, the state is starting to work on its telemedicine policy. Medicaid does cover some telehealth services, but Wisconsin officials should work harder on developing remote care in the state.
Read more about telemedicine in Wisconsin.
Wyoming did not adopt a parity law that would mandate reimbursement for telemedicine services. Medicaid does cover for telehealth, but without comprehensive legislation, the practice will not develop. Wyoming joined IMLC, which is a step in the right direction.
Telehealth and COVID-19
The COVID-19 public health crisis caused many states that had a conservative approach to telemedicine to reconsider their position. Numerous initiatives to expand the coverage and to join the Interstate Medical Licensure Compact show that telehealth is the future of healthcare.
States with regulated remote care laws are more successful in dealing with the pandemic. Telemedicine vendors, like Curogram, offer invaluable assistance in establishing testing sites or help hospitals with efficient software solutions in fighting the epidemic. One of the best examples is the partnership between Curogram and United Memorial Medical Center in Houston, which resulted in setting up the first drive-thru testing facility in the country.
American Medical Association is calling for wider use of telehealth during the crisis and offers guidelines on how to bill the services during the pandemic accurately.
Additional Tips for Telemedicine Reimbursement
If you are thinking about establishing a telehealth practice or incorporating it into your business, you should be aware of some requirements regarding the technology behind telemedicine.
Although you can choose the vendor of your liking, reimbursement is only mandated if the standards of care are met.
In telehealth, this means that you must choose the platform wisely because the technology also has to comply with legislation. It is crucial to opt for the solutions that can provide data security and privacy, so make sure you use:
- HIPAA compliant communication tools
- Encryption and password protection for all patient information
Insurers can deny reimbursement if the technology does not meet the required standards.
It is also essential to check if the telemedicine platforms can integrate with other medical software that you are using. This is especially important in the case of electronic health records (EHRs). The Curogram platform integrates with over 700 EHRs, so keeping and updating clinical documentation is quick and easy.
Curogram EHR integrations
Another piece of software your digital platform should integrate well with is your billing system. It allows you to code your visits appropriately, and submit them to claims almost in real-time.