Getting Medicare Reimbursement for Telehealth Lab Services: The New CONNECT for Health Act

Like most cliches, the one about the COVID-19 pandemic’s transformation of medicine forever is laden with truth. Telemedicine is Exhibit A. Of course, telemedicine goes back decades. But the pandemic accelerated the breakdown of resistance on the parts of providers, regulators and above all, patients. It was supposed to just be temporary. But to use still one more cliché, now that the toothpaste is out of the tube, it becomes a matter of figuring out how to regulate it effectively. Ironically but hardly unexpectedly, one of Congress’ first attempts to impose systematic regulation involves recycling a piece of legislation that failed to gain support in pre-pandemic times but may make it into law this time. Here’s a quick overview of the so-called CONNECT for Health Act and what lab managers should know about it.

CONNECT Four May Be the Charm

Formally known as the Creating Opportunities Now for Necessary and Effective Care Technologies for Health Act of 2021, CONNECT is a massive bill introduced into Congress to address telehealth, connectivity and Medicare through the end of the pandemic and beyond. The 2021 version represents the fourth iteration of CONNECT introduced in Congress, the latest being in 2016. But this time things are different, the bill’s backers insist.  

The big change is that Americans have actually tried telehealth—and they like it. A March 2021 survey by Sykes found that of 2,000 Americans polled, almost 88 percent said they had tried and want to continue using telehealth for nonurgent consultations after COVID-19 has passed, while almost 80 percent say that it is possible to receive quality care virtually. These findings represent a dramatic contrast from a March 2020 Sykes survey in which roughly 65 percent of Americans said they felt hesitant or doubtful about the quality of telemedicine, and 56 percent didn’t believe it possible to receive the same level of care as compared to in-person appointments. 

The 4 Key Coverage & Reimbursement Elements of the CONNECT Bill

CONNECT 2021 is a giant amoeba that incorporates 23 other different bills that have also been introduced into Congress. Here are the four parts of the bill that will likely have the most direct and immediate impact on labs.

1. Elimination of Statutory Barriers to Telehealth 

First and foremost, CONNECT would make the temporary of expansion telehealth during the pandemic permanent after the public health emergency ends. Specifically, it would:

• Give HHS authority to waive current statutory restrictions banning Medicare reimbursement for telehealth services as long as it determines that there’d be no “adverse impact to quality of care,” beginning January 1, 2022;
• Eliminate the requirement that the originating site of the telehealth service be: (i) located in a rural health professional shortage area; (ii) located in a county not included in a Metropolitan Statistical Area (MSA); or (iii) an entity that participates in a federal telemedicine demonstration; and
• Expand originating sites to include the home, presumably including home collection of samples for lab testing.

2. Elimination of Provider-Specific Telehealth Restrictions

CONNECT would also remove restrictions for specific types of providers or services potentially affecting many affiliated testing labs, including via:

• Permanently allowing Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) to furnish and get reimbursed for telehealth services as distant site providers;
• Removing originating site restrictions for Indian Health Services and Native Hawaiian Health Care Systems;
• Removing restrictions for emergency medical care services; and
• Allowing telehealth for recertification of a beneficiary for the hospice benefit.

3. Expansion of Medicare Reimbursable Telehealth Services

Old Rules: Labs, hospitals and other stakeholders that wanted CMS to add a service to the Medicare Telehealth Services List had to submit a request under one of two categories:

• Category 1 for services that were similar to the professional consultations, office visits and office psychiatrist services already on the List; or
• Category 2 for services not similar to those already on the List.

CMS reviewed Category 2 requests once a year to determine whether: (i) the corresponding code accurately describes the service when delivered via telehealth, and (ii) use of telecommunications provides demonstrated clinical benefit to the patient. This rigid, two-tiered system made the expansion of new services to the List slow and cumbersome.

New Rules: CONNECT would permanently establish a new Category 3 pathway created as part of the 2021 Medicare Physician Fee Schedule (MPFS) allowing the temporary addition of telehealth services that have a “reasonable potential likelihood of clinical benefit and improved access to care.

4. Kickback Liability for Telehealth Equipment 

Lab compliance officers also need to be aware of the new “program integrity” rules designed to prevent telehealth services fraud and abuse. One big issue is whether labs and other providers would be liable under the Antikickback, Stark and False Claims Act for network interfacing, interoperability and other technology they provide patients so for purposes of delivering telehealth services. The good news is that CONNECT includes clarification that providing technology necessary for delivery of services wouldn’t be considered “remuneration” under fraud and abuse laws. However, the details will have to be ironed out. This offers labs much less comfort and room for maneuver than previous versions of the bill that included broader liability protections. 

Takeaway

Although it represents massive progress, the CONNECT bill is also a bit of a downer in the sense that it doesn’t go as far as many had hoped in making telehealth services reimbursable and protecting labs and other providers from liability. Thus, for example, even though CONNECT establishes the home as an originating site for coverage purposes, it would still require that other originating sites be established via the administrative process. By contrast, rival legislation, including a bill called the Telehealth Modernization Act (TMA), would fully repeal both originating site and geographic restrictions.

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This is an abridged version of an article that originally appeared in G2 Intelligence, National Lab Reporter, June 2021.