Just as the long off-ramp from the COVID-19 public health emergency (PHE) ends and telepsychiatry providers breath a sigh of relief with a temporary extension of virtual prescribing flexibilities, a report dropped showing an estimated $348 million in telehealth psychotherapy Medicare payments were noncompliant.
This week, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) released the findings of an audit (PDF) of Medicare payments from March 2020 through February 2021. During the audit period, Medicare Part B paid $1 billion for more than 13.5 million psychotherapy services, including telehealth services.
Of the $1 billion in Medicare Part B payments, approximately $591 million was for psychotherapy services that were billed as telehealth services, and approximately $439 million was in payments for in-person psychotherapy services, according to the report.
The federal watchdog estimates $580 million in improper payments for services that did not comply with Medicare requirements during the audit period, including $348 million for telehealth services, or about 60% of the payments, and $232 million for non-telehealth services.
“Because of the significant increase in psychotherapy services billed as telehealth services during the PHE and the high improper payment rates we identified in our prior audits, we conducted this nationwide audit of psychotherapy services to determine whether the compliance issues identified in the prior audits occurred during our audit period,” the report said.
The report estimated that inaccurate requirements for reimbursements led to Medicare overpaying $35,560 per misdocumented day.
In descending order, the type of documentation deficiency included undocumented psychotherapy time, missing or incomplete treatment plans, missing or incomplete documentation or incorrect billing codes.
OIG made several recommendations to the Centers for Medicaid & Medicare Services (CMS), the first of which being recouping the $35,560 in improper daily payments and notifying providers that are believed to have received inappropriate payments.
“Providers did not meet Medicare requirements and guidance when billing for some psychotherapy services, including services provided via telehealth,” the report said. “For 84 of the 216 sampled enrollee days, providers met Medicare requirements. However, for 128 sampled enrollee days, providers did not meet these requirements. In addition, for 54 sampled enrollee days, providers did not meet Medicare documentation and billing guidance.”
The OIG report also included information on providers' experiences with providing telehealth services during the PHE.
"CMS may be able to use this information when making decisions about how telehealth can be best used to meet the needs of Medicare enrollees in the future," the report authors wrote.
Some doctors reported that they encountered challenges related to providing telehealth services, including problems with Medicare enrollees accessing services. Specifically, they reported problems with technology issues like unreliable internet connections, patients who did not know how to use telehealth communication technology and privacy concerns as patients often had to try to distance themselves from others in the household to keep psychotherapy sessions private.
Despite a potential fumbling of payments, the report lauded CMS for its swift response to the COVID-19 pandemic via the implementation of telehealth waivers that allowed for enrollees to receive care during stay-at-home orders.
Waivers included telehealth coverage beyond rural areas and coverage of audio-only communications technology. HHS waivers also allowed for the suspension of the requirement that enrollees have an established relationship with their provider before receiving telehealth services.
Waivers and modifications implemented by CMS also affected the reimbursement of telehealth services with virtual care being paid at the same rate as in-person services. While some misdocumentation did not result in misallocation of funds, the report stated that the loss of data has larger consequences.
“These findings did not have associated improper payments because they did not reflect noncompliance with Medicare requirements,” the report said. “However, this information may be beneficial to CMS when considering future oversight mechanisms or policy changes related to providers’ signatures and billing for telehealth services.”
OIG also recommended that CMS implement system edits to prevent incorrectly billed psychotherapy services, strengthen educational efforts informing providers on requirements and guidance, conduct medical reviews of psychotherapy and telehealth services and review jurisdictional requirements.
"CMS could have potentially saved Medicare $580 million in improper payments for our audit period by taking the necessary steps to implement adequate provider oversight mechanisms for psychotherapy services," OIG said.
CMS concurred with four of the six recommendations, stating that OIG should remove the suggestion to implement system edits for psychotherapy services and that it will review OIG’s response in relation to jurisdictional findings.
The PHE is set to end May 11, although the Biden administration has made several COVID-era flexibilities permanent or offered temporary extensions.