Telehealth needs to deliver care at a lower cost

It’s time for the technology to deliver on its promise

WITH MANDATED CLOSURES, significant loss of revenue, and uncertainty impacting Main Street’s bottom line, the COVID-19 pandemic has already imposed unforeseen costs on small businesses struggling to survive. But even as employers grapple with these challenges, they are working hard to make sure their employees have continued access to high-quality and affordable health care. For many during this time, that has meant access to telemedicine.

In March, Gov. Charlie Baker issued an executive order allowing employees and families insured in Massachusetts to have broad access to virtual remote visits. This has kept countless employees, employers, and front-line health workers safer. Patients interacted with their doctors through online platforms, by phone or via email, more than a million times since the beginning of the public health emergency and providers were reimbursed at the same rate as an in-person visit for all forms of communication. While it is clear that telemedicine has been an effective alternative to in-person care during the pandemic, the future of telehealth must deliver on its promise as a low-cost alternative to traditional in-person visits.

Telehealth can and should provide access to quality, clinically appropriate care in an alternative setting at a lower cost. With the right framework, telehealth can be smartly integrated with traditional care, maintaining the same high-level of quality while guarding against increased costs due to duplicative, unnecessary, or ineffective services.

The types of visits appropriate for telehealth and the technologies used will need to ensure that patients are receiving the same standard of care as in-person treatment. At the same time, the telehealth model of care can offer lower margins, lower labor costs, and lower facility expenses for providers. All this should result in lower reimbursement rates for those services and savings for employers and consumers as we rebuild the economy.

It is unlikely that the current mandated payment levels for telehealth accurately represent the value of using more efficient technologies. The approach taken in Baker’s executive order mandating payment for all telehealth services at the in-person rate was the simplest way to quickly stand up expansive coverage for telehealth visits and ensure continued access to health care services during an unprecedented public health emergency. But if we do not want to see increased premiums as a result of the continuation of mandated payment rates, the future state of telehealth must allow for market-based negotiations to occur.

Employers cannot afford to pay more than the true value of telehealth services. It makes sense to establish a time limit on the payment rate, as MassHealth has done. That ensures reimbursement at the in-person rate until the end of 2020. After that, health plans and providers should be free to negotiate the rate.

We applaud the governor and the Legislature for their attention to telemedicine throughout this session and hope that any final legislation will foster coverage of more efficient care through telehealth while protecting employers and consumers from increased health care costs.

We support the telehealth framework outlined in the House bill, which ensures that the quality of care provided to consumers is maintained, recognizes that not all services may be appropriate for delivery via telehealth, and allows health plans to manage the telehealth benefit to ensure that both the health care service and modes of virtual communication are appropriate for the treatment rendered.

With some of the highest health care costs in the nation, Massachusetts has an opportunity to lead the way in efficiencies by incentivizing innovations in care delivery and encouraging cost-savings through telehealth. A framework that permits payment rates for telehealth visits to be set through payer-provider negotiations and allows for value-based payment arrangements; protects against inadequate, unnecessary, or duplicative services; and promotes innovative care delivery necessary to lower costs and improve access to care will ultimately put dollars back into the accounts of local small businesses.

Meet the Author

Jon Hurst

President, Massachusetts Retailers Association
Meet the Author

Christopher Carlozzi

State director, National Federation of Independent Businesses
Now, more than ever, we have a responsibility to ensure that individuals and families in Massachusetts can access high-quality, affordable health care. It’s time for innovations like telehealth to deliver on their promise of increased access and lower costs.

Jon Hurst is president of the Retailers Association of Massachusetts and Chris Carlozzi is state director of the National Federation of Independent Business.