Medicaid Telehealth Growth Triggers Billing Concerns

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By James Swann

A surge in claims for Medicaid telehealth services has caught the attention of the U.S. government, which plans to investigate whether billing requirements are being met.

Medicaid telehealth providers can look at the inquiry as a positive step, as it indicates telehealth has grown into a viable service meriting government attention, Nathaniel Lacktman, a health-care attorney with Foley & Lardner LLP in Tampa, Fla., told Bloomberg Law Nov. 28.

Telehealth involves receiving medical care from a physician or other practitioner who’s not physically present. Patients can interact with their doctors through phone calls, video chats, or other electronic methods.

Telehealth is nearly universal, Lacktman said, with 48 out of 50 state Medicaid programs covering some kind of telehealth. A move to telehealth can reduce costs for state Medicaid agencies. Many state Medicaid agencies currently pay for a patient’s transportation to a provider for medical services, but a greater reliance on telehealth could reduce that cost, as patients wouldn’t have to travel, Lacktman said.

A report on billing for telehealth, expected to be released in fiscal year 2019, was added to the Health and Human Services Office of Inspector General’s work plan in mid-November. The OIG will review telehealth claims from several state Medicaid agencies to determine if they’re meeting Medicaid billing requirements.

State Medicaid agencies have some discretion when it comes to billing for telehealth services, including determining what services will be covered and how much to reimburse.

Billing Compliance

It’s no surprise that the OIG has decided to look into Medicaid telehealth services, spurred by their growth over the last few years, Danielle Sloane, a health-care attorney with Bass, Berry & Sims in Nashville, Tenn., told Bloomberg Law Nov. 28.

“It should, however, cause telehealth providers to consider carefully revisiting their compliance with each Medicaid programs’ rules regarding telehealth services,” Sloane said.

Variations in policies and procedures among state Medicaid programs make it challenging for providers to maintain compliance with multiple programs, Sloane said.

In addition, “despite the increased utilization of telehealth services, many state Medicaid program rules remain vague and challenging to even locate,” Sloane said.

The OIG’s experience auditing telehealth is still limited, and the agency’s job will be further complicated because different state Medicaid agencies consider different sets of services reimbursable, Judith Waltz, a health-care attorney with Foley & Lardner LLP in San Francisco, told Bloomberg Law Nov. 28.

“For example, in some circumstances, telehealth has to be more than a phone call or e-mail, but it would be easy to claim an interactive visit, such as a Skype call, and it would take an audit to actually know what sort of communication occurred,” Waltz said.

Telehealth also hasn’t been fully integrated into traditional coding and documentation requirements, Waltz said.

Stumbling Blocks

The more patients learn about telehealth services, the more they want them, Lacktman said, but some obstacles remain. Many hospitals have explored the idea of off-shoring their telehealth services by contracting with physicians in foreign countries to provide telehealth services, Lacktman said.

There’s a huge incentive to seek out these arrangements, as they can lower costs for the U.S. hospital and offer health services in the middle of the night due to time change differences, Lacktman said.

However under federal law, hospitals engaged in off-shoring telehealth arrangements can’t bill Medicaid for the services, Lacktman said. Some hospitals may decide to pay upfront for the costs of an off-shore telehealth arrangement so they can offer their patients the service, he said.

Another potential telehealth issue involves the growth of text-based telehealth, such as online messaging, Lacktman said. Many state Medicaid agencies require telehealth services to include either a video or audio component, or both, he said.

To contact the reporter on this story: James Swann in Washington at

To contact the editor responsible for this story: Kendra Casey Plank at

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