• Despite growth spurt, use remains low
• Advocate says increases in telehealth use will correspond to decreases in pricier in-person services

(BNA) — Congress’s Medicare advisers are considering a bigger role for telehealth services, although there’s concern it might lead to increased Medicare spending.

Use of telehealth services under Medicare’s physician fee schedule, such as connecting a patient at home to a doctor, jumped from 2014 to 2016, staff for the Medicare Payment Advisory Commission said Sept. 7. Patients’ telehealth visits increased from 5.3 to 9.5 per 1,000 beneficiaries in 2016. Spending for these services went from $16 million to $27 million.

Advocates say expanding access to these services could increase convenience and reduce medical costs—and telehealth is particularly important for beneficiaries in rural areas and the home-bound. But critics have said Medicare spending could actually increase because telehealth supplements rather than substitutes for office visits.

Particularly in fee-for-service Medicare, where each service is paid for separately, there’s little incentive for doctors to limit the number of services, MedPAC staff said. The commissioners make recommendations on Medicare policy to Congress and the Centers for Medicare & Medicaid Services.

The 21st Century Cures Act required MedPAC to report by March 2018 on the extent to which Medicare fee-for-service and commercial plans cover telehealth services. MedPAC will discuss commercial plan use at its meeting Oct. 5-6.

 
Risk Arrangements

There’s more restraint in arrangements where health plans are at risk for losing money if costs exceed payments, Amy Phillips, a MedPAC research assistant, said. A Medicare Advantage plan, for example, would continue to use telehealth if it reduces costs and produces savings.

But Krista Drobac, executive director of the Alliance for Connected Care, told Bloomberg BNA Sept. 8 that telehealth is a high-value service. Coverage doesn’t necessarily have to be part of a formal arrangement in which the parties are at risk for financial gains or losses, she said. An increase in utilization will correspond to a decrease in more expensive in-person services, Drobac said.

Use Remains Low

The physician fee schedule pays just for certain services, such as cardiac monitoring and transitional care management. Despite the increase from 2014 to 2016, use of these telehealth services remains low, concentrated among a few providers and beneficiaries, such as those dually eligible for Medicare and Medicaid, staff said.

Commission Chairman Francis J. Crosson, a former physician executive at Kaiser Permanente, said allowing beneficiaries to get necessary treatment that they otherwise wouldn’t can help avoid expensive medical care later.

Similarly, Commissioner Warner Thomas, president and CEO of the Ochsner Health System in New Orleans, said dual eligibles, in particular, may have trouble getting out of the house to an appointment and would benefit from home monitoring. However, if the commissioners are concerned with the volume of services getting out of control, MedPAC could track a handful of medical areas over a period of time to determine whether use actually does escalate.