Skip to main content

Telemedicine Reimbursement, Coverage is Better Than Ever

Analysis  |  By Alexandra Wilson Pecci  
   July 25, 2019

"The question of how telehealth can improve hospital revenue cycles is an evolving area worthy of additional study beyond the ATA Report," says the American Telemedicine Association's CEO.

More states than ever are expanding telehealth coverage and reimbursement, according to a new report from the American Telemedicine Association (ATA).

It shows that since 2017, 40 states and the District of Columbia have adopted substantive policies or received awards to expand telehealth coverage and reimbursement.

That friendlier reimbursement environment is combined with ramped-up physician adoption: an American Well survey released earlier this year showed that physician adoption of telehealth increased 340% between 2015 and 2018, far outpacing adoption rates in the early years of EHRs.

But what that might mean for the revenue cycle needs a closer look.

"The question of how telehealth can improve hospital revenue cycles is an evolving area worthy of additional study beyond the ATA Report," Ann Mond Johnson, CEO of the ATA, tells HealthLeaders via email.

One of the answers likely lies in one of the report's key findings: "that a growing number of states allow for insurance reimbursement parity," Johnson says.

Specifically, the report found:

  • 36 states and the District of Columbia have parity policies for private payer coverage
  • 21 states and D.C. have coverage parity policies in Medicaid
  • 28 states have Medicaid payment parity policies
  • 16 mandate payment parity for private payers

Johnson notes that "increased reimbursement parity laws can be seen as a positive development for all providers, including hospitals, because they can generate revenue from payment from third parties (e.g., insurers) in addition to patient cost sharing for services rendered at a lower cost to providers."

More broadly, she points out that anytime a service is provided on a cash-pay basis, the revenue cycle stands to benefit, since providers can often request payment upfront, rather than wait for an insurer to process a claim.

"It has been argued a hospital's ability to improve its revenue cycle is likely stronger in a cash-pay setting where patients are more likely to pay for services up front; cash-pay telehealth services are no different in this regard," Johnson says.

The survey also found that:

  • The majority of states have no restrictions around eligible provider types; 10 states have authorized six or more types of providers to treat patients through telehealth.
  • Only 16 states limit telehealth to synchronous technologies while most of the country recognizes the benefits of remote patient monitoring and store and forward.

Alexandra Wilson Pecci is an editor for HealthLeaders.

Get the latest on healthcare leadership in your inbox.