The article is based on a new industry report from the Waters Center for Telehealth and eHealth Law (here). Medicare's thin coverage for telemedicine opened with a short section of the Balanced Budget Act of 1997, providing limited benefits for live video interviews between centrally located physicians and patients located in remote areas (here). Although this limited benefit has been expanded in baby steps, it contrasts sharply with a recent forecast for telemedicine becoming a $17 billion dollar global industry in the 2015-2020 range (here). Mid-2015 investments in dhealth are running in the $2B range (for 3 estimates, see here). Outside of Medicare, barriers are falling. United Healthcare recently began providing some coverage for virtual visits (here) and Walgreens is setting up to provide telemedicine visits as well (here).
dHealth's Rapid Rise in Visibility
The field is poised to break open. Notably, the name telemedicine is being replaced with digital health (dHealth) - UCSF has a whole section of its translational medicine and startup entrepreneurship program pointed in this direction (here), USC has a dHealth center (here) and West Coast venture capitalists have been pointing to dHealth as a major growth area for over a year (see here, here, here, here, here, here.) In Europe, the Kings Fund annual conference for telemedicine was recently renamed the Digital Health Conference (here). The term dHealth is broad enough to encompass electronic health records, clinical decision support, mobile digital health, telemedicine, and health applications of big data. (See, for example, the breadth of the June 2015 Kings Fund dHealth conference agenda, here, on tab "agenda.") The 2015 BIO convention will feature a digital health keynote by Eric Topol (here), and there are competing events called Digital Health Summit (June 2015, SF, here) and Digital Healthcare Innovation Summit (November 2015, Boston, here.) There is also a quite large Washington event, Health Datapalooza (June, 2015, here.) For a 2014 McKinsey report on digital health, see here. For a 2014 Commonwealth Fund report, see here. See Kleiner Perkins' annual 200-slide deck on internet trends, with a substantial May 2015 section on digital health (here) and try to figure out how a list of 10 top emerging dHealth companies fit into the Medicare program (list of ten companies, here). The term "digital health" is being used by NIH, FDA, FCC, Silicon Valley leaders, and others (here). There is a highly active digital health collated newsmagazine at Flipboard (here). The point is - despite rational concerns about hype (here; here), a lot is going on, and nearly everywhere but Medicare,
CMS is a Walled
Medicare's 1960s era fee for service mentality is a poor substrate for digital health. Outpatient services are paid based on the time of a physician (in minutes!), support services for him or her, from nursing staff to disposables, and other benefits for drugs and durable medical equipment. Software is a colossal flop in this system, as payments would be made for seconds (or milliseconds) of use of computer time as the computer is amortized over 10,000 hours and five years.
There are other administrative barriers, such as state by state medical licensing laws. However, a recent Supreme Court decision that the North Carolina dental board was subject to anti-trust action (here, here) has emboldened the telemedicine company Teledoc to sue the Texas Medical Board on similar grounds (here); track also the Interstate Licensure Compact (here and here). But while Texas moves to raise barriers, Connecticut is moving to lower them (here).
What is Congress Up To?
Two pieces of legislation, one recently passed, one under discussion, are relevant to digital health and Medicare.
Passed: MACRA. In April 2015, the "Medicare Access and CHIP Reauthorization Act [MACRA]" touched telehealth in several ways. It clarified that new models like physicians can get practice improvement credits for activites including remote monitoring or telehealth, and that advanced payment models can include telehealth services not included in 1834(m) of the Medicare act; and MACRA instructs the GAO to conduct a study of telehealth services including issues that facilitate or inhibit the use of telehealth in the Medicare and Medicaid programs. None of these is big bucks or big excitement, but they show that telehealth ideas are at least percolating in the hallways on the Hill.
Discussion: 21CC. This spring, the House Energy & Commerce Health subcommittee has released several successive versions of a bill called 21st Century Cures, which includes sections about NIH, FDA, and CMS. The CMS section includes a subtitle "Telehealth Services under the Medicare Program." This instructs CMS to provide the House and Senate on chronically ill and/or dually eligible patients whose health would be most improved by expansion of telehealth services. CMS shall also report to Congress on its range of activities in the Center for Medicare and Medicaid Innovation regarding telehealth, and the types of high volume procedures which might be advanced by services using telehealth. Finally, CMS is to report on barriers that might prevent the expansion of telehealth services.
21st Century Cures also directs the Medicare Payment Advisory Commission (MEDPAC) to look at conditions and services for which payment couldn't be made to Medicare Advantage plans due to telehealth restrictions in traditional Medicare, and to recommend telehealth services for inclusion as a Medicare fee-for-service benefit. MEDPAC is also to provide an overview to barriers and mitigations to the barriers.
Finally, and related to the antitrust issues percolating up around state medical boards in the courts, the bill states it is the "Sense of Congress" that states should collaborate to create common medical licensure requirements, and that that "expansion of telehealth services under the Medicare program should recognize that telemedicine is the delivery of safe, effective, quality health care."
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Footnote - on July 12, 2015, the New York Times published a lead Sunday article on "Modern doctors' house calls, Skype Chat and fast diagnosis" - here . Writing: "Telemedicine is facing pushback from some more traditional corners of the medical world. Medicare, which often sets the precedent for other insurers, strictly limits reimbursement for telemedicine services out of concern that expanding coverage would increase, not reduce, costs....Legislatures and medical boards in some states...are trying to slow the rapid growth of virtual medicine."
See also a Washington Post article in October 2014, "Law restricts millions from telemedicine," here.
