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How Telemedicine Drives Volume, Revenue

Scott Mace, for HealthLeaders Media, October 22, 2013

At Mercy Health in metropolitan St. Louis, clinicians are monitoring 450 beds spread across Arkansas, Oklahoma, Kansas, and Missouri, with plans to expand to a fifth state. All told, Mercy Health has more than 70 telemedicine projects in development, "anything from doing e-consults from any specialty to inpatient to outpatient and then in the remote home monitoring field and then even consulting in the home via video," says Wendy Diebert, vice president of telemedicine services at the 32-hospital system, which includes 300 outpatient facilities.

"Some of it is direct fee-for-service," Diebert says. "Some of it, we're paid a service fee to provide the service, so then the hospital can bill for that service. But once the physician's paid a service fee, they cannot bill for it."

Still other telemedicine services are funded on a population management model, where Mercy is paid a set fee to keep a population of patients healthy, Diebert says.

With telemedicine reimbursement issues still unsettled in various states, Diebert says the system has spent the past year trying to come to grips with the issue.

"Each model of service that you deliver, you have to develop a template for reimbursement around that, then it all ties into scheduling and where you draft the fees at," Diebert says. "It seems so simple, because everybody just says just bill it. Absolutely you can just bill it, but you also have to have certain things in place to do that."

One of those things is that the healthcare system has to have a license in the state where the patient receives the telemedicine services, Diebert says.

"The second thing is you have to have privileges at the hospital" where services are delivered, she adds.

"The third thing, which everybody underestimates, and we clearly underestimated, is that you have to have those credentials with every plan—whether it's managed care, government plans, and that could be anywhere from five to seven applications per physician after you've already completed all the other applications."

At this point, Mercy Health has created "a centralized hospital privileging agreement across our health system, and now we're working on a centralized managed care contract so that if I get them in this plan and this community, that they're accepted in all plans in all communities," Diebert says.

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1 comments on "How Telemedicine Drives Volume, Revenue"


Nirav Desai (10/24/2013 at 8:41 PM)
This is an excellent article in that it highlights some of the key nuances of getting involved in telemedicine. When you're running across states or rural/suburban/urban, you do have to deal with differences in reimbursement. The UC-Davis, Mercy and Intermountain teams are doing some great trailblazing work. Thanks for sharing some of their insights and discoveries.