A study by the RAND Corporation says more generous reimbursement policies are needed to sustain telemedicine expansions made as a result of COVID-19 in order for patients to be able to seek help from medical specialists.

Easing reimbursement policies could sustain telemedicine expansion

August 10, 2020
by John R. Fischer, Senior Reporter
Greater support from payers and the government is essential for sustaining telemedicine programs that expand access to medical specialists.

That’s what a new RAND Corporation study asserts, claiming that more generous reimbursement policies would sustain the expansions of telemedicine brought on by social distancing measures enacted in the wake of the COVID-19 pandemic.

“I do believe that the COVID-19 pandemic has dramatically changed healthcare delivery in the U.S. and that telehealth will have a larger role in coming years,” Dr. Lori Uscher-Pines, senior policy researcher at RAND, told HCB News. “The pandemic has demonstrated that many in-person visits can be replaced by virtual visits to the satisfaction of both patients and their providers. Recent data suggests that behavioral health providers were especially successful in transitioning to telehealth services during COVID-19, and telehealth helped them maintain continuity of care.”

Uscher-Pines and her colleagues evaluated nine California community health centers that provide patients access via telemedicine to medical specialists from their primary care clinics. The clinics were enrolled in a project called the Sustainable Models of Telehealth in the Safety Net, which sought to transform health centers from low-volume to high-volume telemedicine providers that offer greater access to specialty care with the technology.

The community health centers spent between $4,400 and about $250,000 to establish expanded telemedicine programs and purchase new equipment for them. All nine operated health clinics mainly in rural California and had, on average, experienced a slight decline in telemedicine use prior to the start of the project. Volume, however, increased significantly at the start of the initiative and continued to rise over time.

Patients would visit the health center where they typically received primary care, only to instead be connected to a remotely located specialist employed by another organization. Nearly half used telemedicine to connect with a behavioral health provider, while a quarter used it for eye care. Other common specialists included endocrinologists, rheumatologists and dermatologists.

Telemedicine volume at the clinics ranged from less than 500 visits annually to more than 7,000 per year. While a positive finding, administrators from all centers said that telemedicine was a cost center for their organizations and that there several financial factors that prevent providers from being able to break even on it as a service. These include a high no-show rate, limited connectivity, restrictions that prevent some providers from offering it, telemedicine visits taking up space that could be used for more profitable visits, and the costs associated with switching telemedicine providers.

Concerns like these make payers and policy makers hesitant to expand reimbursement for telehealth, out of fear that implementing it as a service will be costly, without having a significant impact on health outcomes.

The RAND Corporation recommends that clinics hire a telemedicine coordinator to oversee their efforts, and to consider offering telemedicine services to patients from their home. The home model has become more common since the outbreak and allows health centers to service patients who live farther away. It may also be more sustainable due to it using less physical clinic space and allowing salaried providers employed by a clinic to work at full capacity.

“Prior to COVID-19, many payers focused on ensuring access to telehealth only among the most underserved patients (e.g., rural patients in communities without enough healthcare professionals),” said Uscher-Pines. “Payers are also looking for evidence that telehealth services are equivalent to in-person care in terms of quality. Healthcare providers who can help demonstrate the impact of telehealth on health outcomes can help influence the debate on the reimbursement and regulation of telehealth services.”

Funding for the research was provided by the California Health Care Foundation.

The findings are available online at www.rand.org.