Payers Paid Similarly for Telehealth and In-Person Claims in 2020

New research investigates the financial impact of reimbursing telehealth services at parity with in-person care.

Private health insurers were reimbursed similarly for telehealth and in-person visits in 2020, according to analysis from the Peterson- Kaiser Family Foundation Health System Tracker.

The research used data from the Health Care Cost Institute for the 2020 calendar year to examine the cost benefit to payers for reimbursing services provided through telehealth.

After looking at the average paid amount for evaluation and management claims and mental health therapy claims controlling for variation across providers, regions, and the severity of the claims, researchers found little difference between telehealth and in-person services.

"Telehealth use surged with the COVID-19 pandemic as patients sought access to services while providers implemented social distancing protocols," the researchers wrote. "Early in the pandemic, many payers eased restrictions on the use of telehealth and increased reimbursement rates to encourage its use."

For established patients at severity level one, payments were $34 for telehealth and $33 for in-person. At the highest severity level (five), the gap was $143 for telehealth and $137 for in-person.

For new patients, the difference in payments was also negligible—$61 for telehealth and $63 for in-person at severity level one, while severity level five was $273 and $267, respectively.

The trend held true for mental healthcare as well. The researchers found that 52% of mental health therapy claims for people with private plans were delivered over telehealth, with both the lowest (30 minutes of psychotherapy) and highest (psychiatric diagnostic evaluation with medical services) claims dead even in payments for telehealth and in-person.

Additionally, the analysis looked at how paid amounts varied within each provider. Among most of the providers offering the same service by telehealth and in-person, the average paid amount for claims delivered over telehealth was within plus or minus 10% of the payment for in-person claims.

Telehealth serves to increase access and convenience for patients, but if it encourages more utilization of services, it could mean greater spending for payers.

The key factor for the evolution of telehealth is how insurers reimburse services, the researchers concluded.

"We do not know at this point if private insurers continue to pay for telehealth in parity with in-person care," they wrote. "However, if telehealth payments continue to be the same as those for in-person care, then this raises questions as to whether telehealth will reduce the spending on common health services, as some have predicted."