Why alternate payment models could be a boon for telemedicine

Reimbursement for telemedicine services is one of the main roadblocks to the use of the technology. While payers have been reluctant to wade into the fray, new payment models offer promise for expanded use of telehealth, according to an article at the American Journal of Managed Care.

If healthcare providers are not reimbursed for telemedicine services, they are less likely to make use of the tools, according to the article. But the services have shown that they are both cost-effective and improve care. The average telehealth visit ranges from $40 to $50, while in-person care can cost as much as $176, according to a recent study.

However, with telemedicine visits often considered lower intensity compared to in-person visits, even if providers are reimbursed, they feel it will be at a lower rate when using the tech, according to AJMC article. At the same time, payers worry about inappropriate use of the services, which would increase costs.

Fewer than 20 states in the country allow reimbursement for telemedicine, and state legislatures and medical boards are reluctant to allow physicians to treat patients they've never met, according to a recent report from USA Today.

Additionally, one big barrier to telemedicine, according to the AJMC article, is the fee-for-service payment model. Through FFS, providers do not receive payment if the service they give isn't included in the payer's fee schedule.

Alternate payment models, such as Accountable Care Organizations, may help alleviate such worries, the authors say.

"In ACOs, providers must also meet quality-of-care standards, thereby favoring technologies that both improve quality of patient care and reduce costs," they write. Incentives for reducing costs and improving the quality of care should help foster efficient use of telemedicine, the authors say.

Increasing use of video conferencing is another option, they say, because while the services are underutilized, they often are covered by health plans.

"Emerging payment models offer the greatest hope that telemedicine will be widely adopted and used in a way that will make it worth the cost," the authors say.

To learn more:
- read the AJMC article