How commercial plans cover digital health varies widely. An AMA analysis says that's hindering progress

While digital health still holds plenty of promise in healthcare, the lack of cohesion between Medicare, Medicaid and commercial health plans about just what digital services should be covered is a major hindrance to its expansion, according to an issue brief (PDF) by the American Medical Association (AMA).

Medicare follows coverage guidelines laid out by the Centers for Medicare & Medicaid Services for digital codes approved between 2019 and 2022. States decide just what digital codes Medicaid approves, but coverage has been expanding over time for that entitlement program, according to the report.

On the other hand, just how commercial plans cover digital health codes varies greatly, often leaving physicians confused about treatment options and patients uncertain about what they’ll have to pay for those services, according to the issue brief. For example, the study noted that Medicare covers six CPT codes associated with remote patient monitoring, while Aetna covers four of those codes.

Other plans, like Florida Blue, cover none of those six codes, according to the report. And still others, like Cigna or CareFirst Blue Cross Blue Shield, will cover them for specific conditions only. It shouldn't be much of a surprise that this sparks confusion, according to the report.

“Commercial payers often follow Medicare coverage and payment decisions,” the issue brief said. “However, services adopted for coverage and payment in Medicare are not always uniformly adopted by commercial payers.”

The AMA study focuses on CPT codes for delivery of digital-enabled care and did not include a broader set of services such as telehealth and audio only visits. Despite a “decade of progress” in development to digital healthcare, the process has not lived up to its original promise, the issue brief states. Health plans typically will assign a committee to review new codes with an eye on what Medicare covers. They’ll then review the clinical evidence, and make a decision.

“The clinical coverage policy is typically the baseline coverage, but there are certain states that require specific coverage in state-regulated commercial plans,” the issue brief said. “In those cases, the state requirements would prevail over the payer’s clinical coverage policy.”

Digital health encompasses a wide range of processes and tools such as health information technology, wearable devices and mobile health and can “include technologies intended for use as a medical product, in a medical product, as companion diagnostics, or as an adjunct to other medical products (devices, drugs, and biologics)”, according to the Food and Drug Administration.

Fully embracing digital health would allow commercial health plans to create more equitable payment methods and design robust value-based payment programs, according to the issue brief. It would pay off for physicians as well, as digital tools could simplify administrative requirements, enhance technological development, allow better communication among specialists and fine-tune the information in electronic health records.

And for employers, the technology could encourage workers to have stronger ties with their primary care physicians, develop platforms for multiple conditions and create on-site virtual care options, according to the analysis.

Experts with the AMA’s Digital Medicine Payment Advisory Group (DMPAG) analyzed information gleaned from interviews and correspondence with health plans as well as other data to reach their conclusions. The DMPAG, formed in 2016, spearheads the development of codes for digital medicine.

“The chasm between the transformative potential of digital health and the reality of its impact today is the ‘digital health disconnect,’” the issue brief said. “Bridging the digital health disconnect will take time, resources, policy redesign, and a commitment by all stakeholders to build care models and companies differently than in the past.”