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Medicare Slow to Adopt Telemedicine Because of Cost Concerns

Congress maintains tight restrictions

For several days, Donna Mills, 68, thought she had thrush, a mouth infection that made her tongue sore and discolored with raised white spots. So she turned on her computer and logged on to, a service offered by her Medicare Advantage plan, Anthem BlueCross BlueShield of Ohio. She spoke to a physician, who used her computer’s camera to peer into her mouth and who then sent a prescription to her pharmacy.

“This was so easy,” Miles said.

But for Medicare patients, it’s also incredibly rare, according to an article in Kaiser Health News.

Nearly 20 years after such videoconferencing technology has been available for health services, less than 1% of Medicare beneficiaries use it. Anthem and a University of Pittsburgh Medical Center health plan in western Pennsylvania are the only two Medicare Advantage insurers offering the virtual visits, and the traditional Medicare program has tightly limited telemedicine payments to certain rural areas. And even there, the beneficiary must already be at a clinic –– a rule that often defeats the goal of making care more convenient.

Congress has maintained such restrictions out of concern that the service might increase Medicare expenses, according to Kaiser. The Congressional Budget Office and other analysts have said giving seniors access to doctors online will encourage them to use more services, not replace costly visits to emergency rooms and urgent-care centers.

In 2012, the latest year for which data are available, Medicare paid approximately $5 million for telemedicine services — barely a blip compared with the program’s total spending of $466 million.

The telemedicine industry says letting more beneficiaries get care online would reduce doctor visits and emergency care. In addition, industry officials as well as the American Medical Association, the American Hospital Association, and other health experts say it’s time for Congress to expand the use of telemedicine in Medicare.

Aetna and UnitedHealthcare cover telemedicine services for members younger than 65 years of age, regardless of whether enrollees live in the city or in the country. About 37% of large employers said that they expect to offer their employees a telemedicine benefit this year, according to a survey conducted in 2014 by Towers Watson, an employee-benefits firm. About 800,000 online medical consultations will be performed in 2015, according to the American Telemedicine Association.

Medicare’s tight lid on telemedicine is showing signs of changing. In addition to Medicare Advantage plans, several Medicare accountable care organizations have begun using the service. Medicare Advantage plans have the option to offer telemedicine without the tight restrictions in the traditional Medicare program because they are paid a fixed amount by the federal government to care for seniors. As a result, Medicare is not directly paying for the telemedicine services; instead, the services are paid for through plan revenue.

This year, Medicare also expanded telemedicine coverage for mental health services and annual wellness visits — but only when done in certain rural areas and when the patient is at a doctor’s office or health clinic. The American Medical Association has endorsed congressional efforts to change Medicare’s policy on telemedicine, as has the American Academy of Family Physicians.

While seniors are more likely to have more-complicated health issues, telemedicine for them is no riskier than for younger patients, said Mia Finkelston, a family physician in Leonardtown, Maryland, who works with American Well, a firm that provides the technology behind That’s because the online doctors know when they can handle health issues and know when to advise people to seek an in-person visit or head to the emergency room, she said.

“Our intent is not to replace their primary care physician, but to augment their care,” she commented.

Source: Kaiser Health News; June 23, 2015.

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