Coronavirus (COVID-19) Emergency Spending Measure Waives Medicare Telehealth Restrictions

As the Coronavirus (COVID-19) continues to spread, the federal government is taking action to respond to this healthcare crisis. On March 6, 2020, the president signed into law an emergency supplemental appropriations bill that provides the U.S. government $8.3 billion in funding to combat the coronavirus at the local, state, national, and international levels.

Importantly, the legislation seeks to improve access to health care by granting authority to the Secretary of Health and Human Services (HHS) to temporarily waive certain Medicare telehealth requirements during the coronavirus public health emergency. Telehealth is the use of electronic information and telecommunications technologies, such as videoconferencing, to deliver medical care, such as office visits and consultations. The new waiver is intended to make it easier for seniors to receive telehealth services from their homes and through use of their smartphones, with the goal of improving access and reducing the risk of contracting or spreading the virus.

Currently, Medicare restricts reimbursement for telehealth services largely to qualifying “originating sites” in rural shortage areas or counties outside a metropolitan statistical area. Under the new legislation, the HHS Secretary may waive temporarily the Medicare “originating site” requirements, allowing Medicare beneficiaries to receive telehealth medical services at their homes during the coronavirus public health emergency.

In addition, Medicare currently does not allow telehealth services to be furnished using phones. The new legislation would waive restrictions on using phones, if the phones have audio and video capabilities and are used for “two-way” real-time interactive communication. In other words, the waiver would allow providers and beneficiaries to use their smartphones to communicate with one another during a telehealth “office visit” or other qualifying service.

While the waiver eases some obstacles for providing telehealth services to individuals covered by Medicare, it comes with certain limitations. Specifically, to be eligible for the waiver, a physician or practitioner (or another member of the same medical practice) must have seen or provided medical care to the beneficiary at least once in the last 3 years. Furthermore, the telehealth waiver is temporary and applies only while the coronavirus is a declared public health emergency.

Telehealth offers great potential to expand health care access, improve health outcomes, and reduce medical costs. Restrictions under Medicare, such as the “originating site” requirement, have traditionally served as barriers to widespread adoption and utilization of telehealth. This temporary waiver is an important step that will improve access to health care services for seniors during the coronavirus public health emergency. If successful, this temporary waiver may serve as a stepping stone to more permanent efforts for enabling Medicare beneficiaries to seek telehealth services. We note that the Centers for Medicare & Medicaid Services (CMS) has already made efforts to enable more seniors to receive virtual care services and to receive telehealth services through Medicare Advantage.

HHS has not yet implemented the waiver. However, we expect that CMS is working quickly to update its claims processing systems to accommodate these temporary changes, and that HHS will implement the new waiver as soon as the CMS system updates are completed.