Model statute a guide for moving California telehealth forward
The Telemedicine Development Act of 1996 is as obsolete as the computers in use back then. Hence the effort by telemedicine professionals and advocates to bring the law up to speed with the technology. On Tuesday, the Sacramento-based Center for Connected Health Policy issued a “telehealth model statute,” a policy report that could influence state policy makers in updating the measure. Some of the report’s recommendations involve definitions, like replacing “telemedicine” with the more broadly encompassing term “telehealth,” and ending the ban on delivering such services by e-mail and phone. Another will require equipment and software vendors to prove their products comply with current telehealth industry interoperability standards. And one recommendation would require private healthcare payers and California’s Medicaid program (Medi-Cal) to cover “encounters between licensed health practitioners and enrollees irrespective of the setting of the enrollee and provider(s).”
“We wanted to create the ideal policy platform because we feel that California is a leader in so many ways in the telehealth field,” Patricia E. Powers, CCHP’s CEO, tells the News Alert.
That leadership, she adds, has eroded as other states have caught up. As noted in CCHP’s Model Statute Report, Medicaid programs in Arizona, Georgia, Wisconsin and Minnesota all cover the use of “store-and-forward” technologies for sending data such as images and video, regardless of the service provided, with Arizona and Georgia also reimbursing providers for store-and-forward in all specialties.
The 1996 act requires Medi-Cal to reimburse telemed procedures as it would traditional health services, however the state also set a 2013 sunset to end Medi-Cal reimbursements for store-and-forward for teledermatology, teleophthalmology, and teleoptometry information. CCHP wants Medi-Cal to continue to cover store-and-forward for all services.
As a non-profit health policy institute, CCHP will not lobby California lawmakers, but is counting on supporters to emerge in the legislature–possibly among lawmakers attending a Thursday CCHP briefing on the model statute.
CCHP has support from two key telehealth groups. One is the California Telemedicine & eHealth Center, one of six federally designated Telehealth Resource Centers nationwide. The other is the California Telehealth Network, which is connecting some 850 healthcare providers in poorer and thus underserved areas to a state and nationwide broadband network dedicated to healthcare.
Eric Brown, CTN’s president and CEO, tells the News Alert that this month, “the first 25 (providers) will be up and running, and it’s very likely that we’ll have another 20 to 25 by the end of the month.”
Another sign of telehealth’s growth these days: Last June, California’s largest private insurer Anthem Blue Cross announced its telemedicine program surpassed 25,000 clinical consultations with Medi-Cal members for members for cardiology, endocrinology, dermatology and neurology medical needs over a dozen years. As of Thursday, that number stands at more than 32,000. The number of participating specialists has risen over the past three years to include 34 specialist doctors, up from 31 last June.
In addition to becoming self-sustaining, supporters of expanded telehealth in California would be wise to continue building relations with two key groups.
One is the state’s medical community, which benefited from the limiting of telemed practices under the 1996 law. For example, patients cannot get coverage for services via telehealth under Medi-Cal without an informed consent waiver and documentation that a barrier existed to an in-person visit. The model statute recommends both rules be eliminated. Today’s doctors are expected to be supportive of any new telehealth measures, CCHP’s Martin and Powers says.
The state’s private health insurers, however, will likely be another story, judging from a statement to the News Alert by Patrick Johnston, CEO of the California Association of Health Plans. CAHP represents 39 member health plans insuring more than 21 million Californians.
“Many health plans use telemedicine as an important tool in expanding access to care, selecting quality providers and lowering costs. It can be particularly effective in rural communities or with specialists for rare conditions. Health plans should have the flexibility to apply this technology in the most appropriate fashion rather than dictating the specific use of this or any other innovation,” says Johnston.
CTeC Executive Director Christine Martin tells the News Alert CCHP is not alone in seeking that more healthcare providers be reimbursed for more telehealth procedures; the nonprofit is in synch with her group and the National Rural Health Association. As a result, she says, the model statute “should open a dialogue with our providers and payers as to how we can best optimize the use of telehealth.”
CCHP sought to encourage such dialogue by including an insurance industry professional (Carolyn Carter, business development manager withWellpoint Inc. Anthem Blue Cross) and several doctors on its Telehealth Model Statute Working Group, a 25-member panel of healthcare and policy professionals.
Whether that consensus gels will depend on how well telemed proponents can convince insurers that the savings promised by telehealth will outweigh the cost of services. A 2007 study by the Center for Information Technology Leadership projected telehealth would yield $511 million in annual savings for California and $4.3 billion nationwide. In today’s dollars, that would be $542.75 million and $4.57 billion, respectively.
The cost? Harder to calculate. The California HealthCare Foundation issued a pair of case studies last November for two specific clinics. One studied a year of operations at Open Door Community Health Centers’ telehealth program, which yielded a $220,734 profit. That reflected revenue from in-person visits with the centers’ own psychiatrist and diabetes educator, as well as grants and reimbursement from third-party payers including Medicaid, Medicare and private insurers.
The other studied the first six months of a teledermatology program at Oakland-based La Clinica de la Raza that lost money–$43,991 under the worst of three calculations. The loss was driven largely by La Clinica’s inability to find a doctor able to bill Medi-Cal or another third party; the clinic paid $40,000 to a dermatologist to whom digital images and clinical notes were forwarded by La Clinica providers.
Medi-Cal’s ability to take on additional costs for La Clinica and others is uncertain. As the state scrambles to plug a $26.6 billion shortfall, Gov. Jerry Brown has proposed reducing Medi-Cal spending, now at $41.6 billion, by $1.7 billion.