State Eases Some Telehealth Restrictions on Medicaid Managed Care Companies

10/3/2017

Governor Andrew Cuomo's administration, looking for ways to boost telehealth in the Medicaid program, will now allow Medicaid managed care plans to bill for the service, provided they explain to the state how it will save the program money.

These so-called in-lieu-of-service requests allow managed care insurers to get around the fact that telehealth is not typically a billable service in the Medicaid benefits package. Essentially, the insurers can ask for a waiver from the state.

The in-lieu-of-service requests also allow managed care organizations to ask for alternative sites from which telehealth can take place. Currently, the law requires a patient to be inside a licensed medical facility for a telehealth service to be billed.

That makes telehealth a lot less convenient for people who do not want to, or cannot easily, leave their homes.

This new process would allow insurers to request that a patient's home, for example, count as an originating site.

The changes were announced Wednesday during the second and final meeting of a telehealth work-group that sought to modernize telehealth regulations.

New York state has a $64 billion Medicaid program but only $350,000 of that is currently spent on telemedicine.

The state has to keep pace with the changing technology and consumer demands, said Mary Zelazny, CEO of Finger Lakes Community Health and co-chair of the work-group.

"Millennials do not accept health care the way we provide it," she said. "We have to get up to speed."

The Cuomo administration also is offering managed care organizations an incentive to cover telehealth: Insurers that submit a telehealth innovation plan will receive five bonus points toward the state's annual quality incentive program, which can lead to financial rewards. The insurers can receive an additional point if their project addresses women with high-risk pregnancies or children in their first 1,000 days of life.

The work-group, in making policy, regulatory and statutory recommendations, looked to California as an example of a state with a far less restrictive telehealth statute.

"The originating site [in California] is anywhere the patient is, simple," said Harold Iselin, an attorney with Greenberg Traurig who represents the New York Health Plan Association and is co-chair of the work-group. "That seems logical. If they are comfortable originating from wherever they are, then I'm not sure why we would care."