Policy Update: States Act to Modernize and Expand Telehealth Laws and Regulations

Just as policy is changing at the federal level to allow – and even encourage – greater use of telehealth and telemedicine programs, states, too, have been active. A number of states are in the process of updating telehealth laws and regulations, modernizing definitions to keep pace with available technology and services and setting rules for providers and plans.

There are as many as 90 bills now pending this year before state lawmakers, according to the Center for Connected Health Policy. They address a variety of topics, including “regulatory, licensing and advisory board oversight of telehealth laws.”

Most bills have the effect of expanding reimbursement, improving the environment for all stakeholders. Historically, many health insurers have been skeptical of the financial and clinical benefits of telehealth programs. As a result, the federal government, and now the states, have begun to adopt legislation and regulations that mandate reimbursement for telehealth and telemedicine services in the commercial marketplace and in public programs like Medicaid and Medicare.

Other issues addressed in pending state legislation/regulation include promoting multistate provider licensing, funding for telehealth pilot projects, establishing guidelines for online prescribing, defining provider-patient relationships through virtual communications, and expanding broadband coverage.

In New Mexico, for example, the Senate passed SB354 “Health Coverage for Telemedicine” on February 26, 2019 and the House adopted the bill on March 15, 2019. The legislation impacts payer coverage in several ways by:

  • Revising the definition of telemedicine to include store-and-forward platforms (asynchronous) and remote patient monitoring.
  • Expanding reimbursement for telehealth programs.
  • Prohibiting payers from discriminating by imposing additional requirements simply because a service was provided via telehealth rather than in-person. This applies to an originating site and provider reimbursement. A provider would need to be paid “on the same basis and at least the same rate” comparable to an in-person provider.
  • Ensuring parity for telehealth financial requirements. Payers can charge a deductible for telehealth as long as the deductible, co-payment or co-insurance doesn’t exceed that charged for in-person care. It would also prevent payers from setting an annual or lifetime dollar cap on telehealth coverage “other than an annual or lifetime dollar maximum that applies in the aggregate to all items and services covered under the health insurance plan, policy or contract.”
  • Encouraging access. Health plans would not be able to limit telehealth coverage only to providers in the plan’s network.

In addition, Virginia just signed into law legislation (SB 1221 and HB 1970) that makes several important policy changes governing telehealth by:

  • Expanding payer coverage (including Medicaid) for telehealth services to include remote patient monitoring and interactive video conferencing, with or without digital image upload.
  • Establishing that “any telemedicine services are legislated from where the practitioner is located.”
  • Allowing telehealth services to be provided to Virginia residents by out-of-state practitioners if the provider is “in good standing with their medical boards and permitted to use connected care technologies.”

Other state activity includes Arizona’s consideration of a bill that parallels work in New Mexico on telehealth and legislation in North Dakota being amended to add “store and forward” as a reimbursable service. Also, Maryland’s Board of Physicians is reported to be completing new telehealth regulations. Content is expected to include “ground rules for telemedicine in establishing a doctor-patient relationship.”

Florida may be going further than most states to meet its goal to “kick start” telehealth in the state. Legislation (HB23), passed by Florida’s House Health Quality Subcommittee, would offer tax breaks – worth as much as $30 million – and the ability to use out-of-state providers, among other changes. The tax credit would be available to “insurers and HMOs willing to reimburse health providers for telehealth services and…could be applied against corporate income taxes or insurance premium taxes.”

There are clear trends in state action to improve the climate for telehealth technology, services and reimbursable coverage. The pace of such modernization is one of the strongest – signaling that telehealth policy is a priority at the both the state and federal level. We’ll continue to keep track for you.

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