OIG Issues Telehealth Report

April 6, 2018 Advisory

As the use of telehealth continues to grow, it has predictably attracted attention from the OIG. Whereas in 2001, Medicare paid $61,302 for telehealth claims, by 2015, that number jumped to $17.6 million. As federal legislation continues to authorize the expansion of permissible telehealth applications, Medicare reimbursement for telehealth services is expected to increase exponentially in upcoming years. Since health care enforcement agencies generally "follow the money," it is not surprising that the OIG has begun to focus on telehealth services as a potential area for fraud and abuse. As indicated in its 2017 work plan, the OIG set out to determine whether Medicare payments for telehealth services were compliant with reimbursement rules. On April 5, 2018, the OIG released its final report titled, "CMS Paid Practitioners for Telehealth Services That Did Not Meet Medicare Requirements."

Medicare pays for telehealth services by reimbursing both the originating site (the facility in which the patient is located) and the distant site provider (the practitioner providing the medical service who is at a different location). The OIG noted that of the 191,118 Medicare paid claims for telehealth services in 2014 and 2015, more than half of the professional telehealth claims billed by distant site providers did not have matching originating site facility fee claims. Suspicious of these unmatched distant site claims, the OIG reviewed a random sample of 100 distant site provider claims and found that 31 of the 100 claims did not meet Medicare requirements. The following is a summary of the specific findings:

  • 24 claims were unallowable because the beneficiaries received services at non-rural originating sites. Medicare requires that originating sites that are not participating in a federal telehealth demonstration project, be located either in a county outside of a Metropolitan Statistical Area (MSA) or in a rural Health Professional Shortage Area (HPSA) located in a rural census tract.
  • 7 claims were billed by ineligible institutional providers. As explained above, Medicare pays a professional fee to the distant site provider, however, only certain types of providers are permitted to bill this telehealth professional fee. Institutional facilities at a distant site may only bill Medicare for telehealth services if: (1) the facility is a critical access hospital (CAH) that elected the Method II payment option and the practitioner reassigned his or her benefits to the CAH or (2) the facility provided medical nutrition therapy (MNT) services.
  • 3 claims were for services provided to beneficiaries at unauthorized originating sites. Medicare pays for telehealth services only when the patient is at an eligible originating site. These are:
    • Offices of physicians or practitioners;
    • Hospitals;
    • CAHs;
    • Rural Health Clinics;
    • Federally Qualified Health Centers;
    • Hospital-based or CAH-based Renal Dialysis Centers (including satellites);
    • Skilled Nursing Facilities, and
    • Community Mental Health Centers.

In the 3 claims identified in the OIG's report, 2 of the patients were at home and 1 was at an independent dialysis center when they received the telehealth services. Because these locations are not recognized by CMS as permissible originating sites, these claims were not covered.

  • 2 claims were for services provided by an unallowable means of communication, including telephone and asynchronous store and forward technology. CMS requires that telehealth services be provided using an interactive telecommunications system. Asynchronous system or "store and forward" technology, where medical information is transmitted to the practitioner at the distant site to review at a later time, is not a permissible method.
  • 1 claim was for crisis psychotherapy, which was not a covered Medicare telehealth service at the time that it was billed, even though it is currently a covered service. Every year, CMS makes changes to the list of Medicare telehealth services in the physician fee schedule.
  • 1 claim was for services provided by a physician located in Pakistan. However, Medicare only pays distant site practitioners who are located within the United States.

As a result of these findings, the OIG recommended that CMS conduct post-payment reviews of telehealth claims in order to recoup Medicare payments for services that are not eligible for reimbursement under the Medicare rules. The OIG also urged CMS to implement telehealth claim edits to deny claims that are not proper before they are paid. Finally, the OIG stated that education and training sessions on the Medicare telehealth requirements would likely help prevent improperly billed claims.

Providers that bill for telehealth services should take this opportunity to review their services and billing policies and ensure that they are compliant with the Medicare requirements, given the increased OIG scrutiny of these claims. Particular attention should be paid to the deficiencies identified in the OIG report. Furthermore, because the scope of telehealth services is continuing to expand, it is essential to keep pace with the ever-changing landscape of legislation, regulations, and guidance documents. CMS maintains a helpful page of telehealth information, where new developments are posted.