Proposed Mandated Health Insurance Benefits
JLARC staff evaluate proposed health insurance mandates in support of the Special Advisory Commission on Mandated Health Insurance Benefits.
JLARC Report In Brief
Evaluation of HB 2191 and SB 1458: Mandated Coverage of Telehealth Services
House Bill 2191 and Senate Bill 1458 of the 2009 General Assembly Session would mandate coverage for telehealth services. In particular, the bills indicate that, for those services appropriately provided through telehealth, insurers cannot exclude a service for coverage solely because the service is provided through telehealth and not through a face-to-face consultation or contact between a health care provider and a patient. This report draws a distinction between the terms 'telemedicine' and 'telehealth' because of the range of services that they entail. Telemedicine typically refers to direct patient care provided using telecommunications technology whereas telehealth includes the direct patient care aspect of telemedicine but also can include activities that are not directly related to the clinical care of a patient, such as transfer of medical data and medical education. Proponents of the proposed mandate indicate that they are most interested in gaining coverage for telemedicine, and similar mandates in other states have typically focused on telemedicine. Therefore, this report concentrates on telemedicine services rather than the broader definition of telehealth.
Medical Efficacy and Effectiveness
A wide body of literature assessing the medical efficacy and effectiveness of telemedicine exists. While concerns have been raised regarding the quality of existing research, staff at the federal Office for the Advancement for Telehealth (OAT), the federal Agency for Healthcare Research Quality (AHRQ), and medical experts at two Virginia medical schools assert that the research sufficiently supports telemedicine and any research limitations should not prevent its expansion as a mode of care. Further, the Virginia Board of Medicine reports very few complaints related to patient care delivered using telemedicine.
Social Impact
Utilization of telemedicine services appears generally low in Virginia and elsewhere. Medicare and Medicaid both provide limited coverage of telemedicine services. However, private insurance coverage appears minimal with approximately 25 percent of health insurers reporting that they provide any coverage of telemedicine services. The State employee health plan also does not provide coverage of these services. Medical experts and staff at the Virginia Department of Health (VDH) indicate that there are positive public health impacts associated with telemedicine through increased access to care in underserved areas. However, without insurance coverage, patients may receive inappropriate care, experience delayed access to specialty care or fail to receive specialty care at all, and/or end up in the emergency department of their local hospital.
Financial Impact
The proposed mandate is not expected to significantly increase utilization of telemedicine because lack of reimbursement is not the only barrier preventing increased use of these services. Other barriers include an unwillingness of practitioners to participate in telemedicine and technology issues. Concerns over whether the mandate would require coverage of out-of-state health care providers does not appear founded. However, a valid concern may be that the mandate's current definition of telehealth could require coverage of services that are not traditionally reimbursed by health insurance. The premium costs associated with mandated coverage of telemedicine services is expected to be low and less than that of many existing mandates, and telemedicine appears to have the potential to reduce overall health care costs.
Balancing Medical, Social, and Financial Considerations
There is significant support from the medical community, VDH, OAT, and AHRQ for the expansion of telemedicine services. Telemedicine increases access in underserved areas and can bring significant positive public health impacts. A mandate requiring coverage for telemedicine services is not expected to significantly increase the utilization of telemedicine, but it would remove one of the barriers faced and is expected to have only a minimal impact on premiums. Focusing the mandate on coverage of telemedicine services, rather than the broader definition of telehealth, would help ensure that the scope of medical services for which coverage is required would not be a change from the types of services typically covered by health insurance.
| Report No. 385: Jun 2009, 52 pages | Report (pdf) | Briefing (pdf) |