Telemedicine offers solution to narrowing networks, but regulatory uncertainty remains

As state and federal regulators target narrowing provider networks, telemedicine appears to be a natural solution for insurers to fill network gaps and enhance negotiating leverage with providers, according to a report released by the Urban Institute.

With support from the Robert Wood Johnson Foundation (RWJF) researchers at Georgetown University Health Policy Institute's Center on Health Insurance Reforms interviewed insurance representatives and state regulators in six states and found the telemedicine coverage varies considerably because of reimbursement laws and coverage parity mandates. At the same time, states are also establishing standards for network adequacy to ensure consumers have access to affordable quality care.

Telemedicine shows "huge potential" to fill coverage gaps, particularly in rural areas where patients have limited access to medical specialists, according to the report. However, stakeholders on both sides recognized telemedicine is not a "panacea for network problems." Certain specialties, like emergency care and anesthesiology, require in-person care, which negates negotiating leverage with those providers.

Although telemedicine coverage has gained momentum in recent months, many insurers have been slow to embrace telemedicine because of regulatory uncertainty, the report notes. Twenty-nine states and the District of Columbia have coverage parity requirements which limit reimbursement flexibility for telemedicine services.

Blue Cross Blue Shield insurers have been more proactive about telemedicine coverage as of late, offering reimbursement for certain specialties in Alabama and South Carolina, but IT experts say more research is needed to understand the effectiveness of telehealth.  

To learn more:
- read the Urban Institute's report