Oregon Private Payer Reimbursement
Private insurers are subject to regulations for telemedicine reimbursement set by the states. Currently eleven states have laws regarding the reimbursement of telemedicine by private insurers. Those states are California, Colorado, Hawaii, Kentucky, Louisiana, Maine, New Hampshire, Oklahoma, Oregon, Texas and Virginia.
Even when mandates are not present, some private insurers reimburse for telemedicine services:
• Some cover specific services, e.g., cardiology, behavioral health.
• Some will reimburse for telemedicine services as long as the rationale for using telemedicine is justified to their satisfaction by the telemedicine program.
• Some pay claims regardless of whether the encounter was in person or via telemedicine and don’t want any indication of how the service was delivered. This is especially true for managed care providers. This approach makes it very difficult to gather cost and benefit data for telemedicine services.
According to a 2007 study conducted by Pamela Whitten, PhD and Lorraine Buis, PhD at Michigan State University, since 2003, there was a 5% increase in the number of organizations receiving private payer reimbursement and there was an increase in the number of private payers being billed.
There are also other payers for telemedicine such as foundations, long term care programs, community health providers, special population organizations e.g. developmental disabilities, chronic disease management, and self pay and self insured groups.
“Probably no topic is more often identified as an ‘issue’ or a ‘barrier’ to innovation, demand and investment in telehealth than reimbursement for encounters.” This statement was made in the US Dept of Commerce report on Innovation, Demand, and Investment in Telehealth in 2004.
Today this remains the case. Although telemedicine payment policies are evolving at a slow but steady pace, limited reimbursement continues to be a major barrier to the expansion of telemedicine. Additionally, it is viewed as an impediment for patient access to quality care in rural and underserved areas. There is a growing interest at the national level to create a universal policy for telemedicine reimbursement in order to promote the growth of telemedicine to sustainable levels.
Oregon's SB 24
In the 2003 legislative session House Joint Resolution 4 was unanimously passed by both chambers. The resolution expressed legislative support for telemedicine and reimbursement for services delivered telemedically. As a result of its passage, the Oregon Medical Assistance Program developed a broad policy for reimbursement, but the resolution drew mixed reactions from the health benefit plans. Some chose to ignore the resolution and not reimburse for telemedicine, some reimbursed at the Medicare level, and others reimbursed more broadly, but were each different from other payers.
At its annual meeting in 2006, the TAO membership decided that the best way to get the needed consistency would be to help draft legislation that would require the private payers in Oregon reimburse for services delivered telemedically. The legislative concept would be presented at the start of the 2009 legislative session.
Before that could happen bills were introduced in the 2007 and 2008 sessions regarding telemedicine reimbursement. Both bills were strongly opposed by providers and payers alike. This galvanized support for the creation of a reimbursement work group. The workgroup was made up of representatives from health benefits plans, healthcare providers, hospitals and health systems, the Department of Consumer and Business Affairs, the Oregon Medical Association, and the Oregon Office of Rural Health. Senator Laurie Monnes Anderson directed the work group to present her committee with a legislative concept for telemedicine reimbursement prior to the 2009 session.
In September of 2008, the work group presented Senator Monnes Anderson and her committee with a legislative concept that became SB 24. It had the support of all the major payers and provider groups in Oregon and was passed by the Legislature in April of 2009, was signed by the Governor in June of 2009. and became law January 1, 2010.
The workgroup agreed to convene in early 2011 to discuss what had happened since the law took effect, to work on any problems that has been encountered. and to discuss how reimbursement data would be captured for policy makers.
