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NDHI NAT IONAL DIALOGUE FOR Healthcare Innovation Inclusion of Telemedicine in Medicare Organization Overview • Teladoc is the first and largest provider of telehealth medical visits in the United States, with 15.4 million members and over 1.6 million visits since the organization’s inception in 2002 • The company was founded with a vision to tackle three of the most significant issues in healthcare today: access, cost, and quality of care • Teladoc provides patients access to a nationwide network of board-certified physicians Background CMS’s current telemedicine reimbursement regulations indicate that a patient must seek care at one of eight kinds of facilities outside of a Metropolitan Statistical Area (MSA), in order for telemedicine services to be reimbursed: a physician’s office, hospital, critical access hospital, rural health clinic, federally-qualified health center, skilled nursing facility, community mental health center, or a hospital-based or critical access hospital-based dialysis facility. This usage restriction is a result of concerns from the Congressional Budget Office, CMS, and other groups, which believe that coverage of telemedicine services will lead to inappropriate utilization, increased government budget costs, and reduced quality of care. However, Teladoc rejects this hypothesis, as it lacks a basis of empirical evidence. On the contrary, Teladoc believes that CMS’s standpoint perpetuates outdated protocols created before innovations in telemedicine and the emergence of current technologies. In contrast to CMS’s limited use of this technology, telemedicine is not only used more widely by the commercial market and employer sector, but is also experiencing a sharp growth trajectory at the national level. Initiative Details Teladoc advocates for CMS to either allow telemedicine to be reimbursed, or to allow for a pilot study to demonstrate its associated cost savings. Specifically, Teladoc aims to expand telemedicine reimbursement for simple, non-emergent illnesses, as well as dermatology and behavioral health, while the patient is at home or at a site that is not currently included in the CMS regulations. Partners in this effort include the Alliance for Connected Care, Health IT Now and the American Telemedicine Association. An Initiative of the 107 | Inclusion of Telemedicine in Medicare
NDHI NAT IONAL DIALOGUE FOR Healthcare Innovation Value Delivered Inclusion of a telemedicine benefit for appropriate illnesses will lead to: • Increased access to safe and high quality healthcare • Decreased costs • Reduced use of emergency facilities for non-emergent illnesses Increased quality of life These telemedicine benefits have already been determined and validated by independent third parties. One such study conducted by Red Quill Consulting, titled “Assessment of the Feasibility and Cost of Replacing In-Person Care with Acute Care Telehealth Services,” estimated that: • Medicare can save an average of approximately $45 per visit by replacing routine primary care visits with telehealth • The reimbursement of telehealth benefits would be unlikely to yield overutilization • The study concluded that the addition of telehealth services in the traditional Medicare fee-for-service program will not increase overall costs and will instead result in cost savings if telehealth visits are substituted for in-person acute care, when medically appropriate Teladoc’s study with Veracity Healthcare Analytics showed that, for commercial markets, telemedicine decreased 30-day episode-based spending by an average $191 compared to an office visit, and $2661 compared to an emergency room visit. The weighted average of these cost savings is $673 per visit. These savings would translate into hundreds of millions of dollars for Medicare, along with the following benefits: • Reduces pressures on primary care providers • Decreases utilization overall within the health care system • Provides access solutions for rural patients • Leads to a more complete medical record • Enhances care coordination • Increases quality of care Path Forward Teladoc continues to advocate for the inclusion of telemedicine in Medicare reimbursement, with an ultimate goal of complete inclusion. Future efforts will also focus on validating an appropriate reimbursement level for these services that will drive more efficient use of resources and decrease costs. Inclusion of Telemedicine in Medicare | 108
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Foreword The U.S. healthcare indust
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Section 1 Collaborations to Enable
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