HCFA not likely to reimburse for telemedicine in near future

June 1, 1997

HCFA not likely to reimburse for telemedicine in near futureAgency's slow pace on issue draws ire of CongressThe Health Care Financing Administration will apparently soon inform Congress of its belief that any decision regarding

HCFA not likely to reimburse for telemedicine in near future

Agency's slow pace on issue draws ire of Congress

The Health Care Financing Administration will apparently soon inform Congress of its belief that any decision regarding telemedicine reimbursement would be premature until its telemedicine demonstration project is completed in October 1999. The agency's position will be included as part of a belated status report on its telemedicine demonstration program that was due to Congress by March 1, as stipulated by an amendment to the Health Insurance Accountability and Portability Act that passed last year.

That report's conclusion will reportedly not satisfy a group of 11 senators, however. The senators submitted a letter May 19 to Department of Health and Human Services Secretary Donna Shalala asking the agency to move quicker to reimburse telemedicine, according to a story in The Washington Telecom Regulation Monitor. In the letter, the senators said that HHS should develop a policy to reimburse patients who use telemedicine services, according to the story. The group was led by U.S. Senate communications subcommittee chairman Sen. Conrad Burns (R-MT), who also sponsored the amendment requesting the HCFA report.

If a bill pending before the Senate passes, however, the reimbursement issue may become moot. As part of the Comprehensive Telehealth Act of 1997 (S. 385), telehealth services will become eligible for Medicare reimbursement. The bill, introduced by Sen. Kent Conrad (D-ND), was referred to the Senate Finance Committee on March 3.

"If that bill passes and we're earmarked as the agency to implement it, then obviously we're going to comply with it," a HCFA source said.

In the meantime, the HCFA report to be submitted to Congress is in final draft form and is being read by high-ranking HCFA officials, according to the HCFA source. In addition to clarifying its position regarding reimbursement decisions, the HCFA report will give a description and an update on the agency's telemedicine demonstration program, which will reimburse for telemedicine services at select sites as a test project. The program, begun in October, consists of two sites in Iowa and one each in West Virginia and North Carolina. A potential fifth site, the Medical College of Georgia, is in negotiations with HCFA over the terms and conditions for being added to the program, according to the HCFA source.

Also, the report will discuss some of the agency's concerns about telemedicine, which will be evaluated after the project has concluded. In addition to expressing concern over the potential for overutilization of telemedicine, the report also states that the success of telemedicine usage will also be evaluated following completion of the project. The agency also cited the current high cost and relatively low utilization of telemedicine as issues that will need to be studied in the program. So far, the number of telemedicine reimbursement claims received from sites participating in the program has been fewer than expected, the HCFA source said.

Another issue that will be raised in the report is the dearth of standards for telemedicine. The American College of Radiology is the only organization to have issued standards relating to telemedicine, the HCFA source said. Work on that front is progressing, however. (See related story on HOST consortium, p. 3).