MedPAC: Telehealth coverage expansion most appropriate in risk-based models

hand with stethescope reaching out of computer screen

The Medicare Payment Advisory Commission (MedPAC) says expansion of Medicare’s telehealth coverage is, at present, most appropriate in risk-based payment models, according to its annual report to Congress unveiled this week.

MedPAC notes that currently, evidence of telehealth’s ability to improve access and convenience for patients is stronger than evidence that such tools can boost care quality or cut costs. “Given the inconsistency in the academic literature, it appears that more targeted research isolating specific telehealth interventions for specific patient populations is needed,” the report’s authors write.

The authors highlight three potential risk-based payment models for expansion of the technology: Medicare Advantage, bundles and accountable care organizations. In all three, they note, insurers or providers take on much of the financial risks of offering such services. “By contrast, under traditional [fee-for-service] Medicare, the additional cost for telehealth services would be borne by the Medicare program, unless such services were substitutes for traditional face-to-face clinical services,” the report notes.

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Because of that, MedPAC says should policymakers opt to eventually expand telehealth services under fee-for-service Medicare, the beneficiary cost-sharing structure and the role of supplemental insurance plans will be important considerations.

“[I]f cost sharing for telehealth services were less than for in-person visits, beneficiaries would have a greater incentive to use telehealth,” the report’s authors say. “The opposite would be true if cost sharing for telehealth were higher than for in-person visits."

Despite telehealth’s potential to expand access to care, government and private insurers’ coverage policies remain largely inconsistent. On the provider side, however, the American Medical Association believes telemedicine is “reshaping the ways [people] engage with medicine." The association recently published ethical guidance for telemedicine and how those interactions might differ from in-person visits, and also wants to see telemedicine training incorporated as a core competency in medical schools.


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