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Reimbursement and Practice Management

Telemedicine: An Opportunity to Expand Your Practice

Over the past decade, the Centers for Medicare & Medicaid Services (CMS) has expanded the list of services payable via telemedicine. During that same time, however, the number of medical practices offering telemedicine has remained quite small. This is an area of opportunity for your practice that comes without the need for extensive space or staff, making it quite profitable.


Learn how telemedicine may be an opportunity for your practice.

View related pearls


Over the past decade, the Centers for Medicare & Medicaid Services (CMS) has expanded the list of services payable via telemedicine. During that same time, however, the number of medical practices offering telemedicine has remained quite small. This is an area of opportunity for your practice that comes without the need for extensive space or staff, making it quite profitable.

First, it is important to understand the definition of telemedicine. Telemedicine features interactive communication between a patient and a physician. According to CMS, as a condition of payment, you must use an interactive audio and video telecommunications system that permits real-time communication between you, at the distant site, and the patient, at the originating site. Physicians, nurse practitioners, physician assistants, clinical nurse specialists, and certified registered nurse anesthetists, among other eligible practitioners, can perform the service.

The distant or hub site is the setting where the physician or other licensed practitioner delivering the service is located when the service is provided via telecommunications system. The originating or spoke site is the location of the patient during this same time. Medicare beneficiaries are eligible for telemedicine services only if they are presented from an originating site in a rural Health Professional Shortage Area (HPSA), located either outside of a Metropolitan Statistical Area (MSA), in a rural census tract or a county outside of a MSA.

From an operational perspective, the distant site typically schedules the telemedicine service using a distinct scheduling type to alert everyone that the patient is "arriving" via telemedicine. Approximately five minutes before the patient is scheduled to "arrive," a staff member is designated to ready the equipment and virtually greet the patient. The physician is summoned in order to commence the encounter. At the originating site, a staff member with clinical skills typically performs the clinical intake and assists the physician. The rendering physician communicates with the staff member at the originate site regarding instructions as the exam is being performed. Depending on the service and availability, these staff members are nurses or medical assistants.

Several vendors sell the telemedicine equipment, many of which offer leasing options. In addition to the equipment, you may need to purchase a cart for the equipment. With a movable cart, you can transport the equipment into your office, an exam room or any available space without having to establish a designated site that would otherwise consume a room for patient encounters.

Payment incorporates both the distant site as well as the originating site. The distant site, which is the physician or advanced practice provider rendering the service, bills the appropriate CPT® code accompanied by the telemedicine modifier GT, which signals that the service was rendered "via interactive audio and video telecommunications systems." As of January 1, 2017, the physician uses a specific place of service — 02 — on the claim to indicate that the services were rendered via telemedicine. Billing separately, the originating site is also paid a facility fee for telehealth services using code Q3014. (Check with your payer regarding the appropriate originating site facility code and fee.) Coverage and reimbursement vary by payer.

The value proposition in telemedicine is multi-fold: volume, use of provider capacity and community benefit. Without sufficient volume, performing telemedicine encounters once in a blue moon won't create value for your practice (or cover the expenses associated with the equipment); however, with sufficient encounters, this new service can be very profitable. If all your practitioners are extremely busy and patients are often turned away (or leave due to lack of appointment availability), telemedicine may not be worth it. However, if the opportunity cost is absent; in other words, your new physician assistant wouldn't have a full schedule anyway; this can be a fantastic method of leveraging what otherwise would be unused provider capacity to boost revenue with a minimal outlay of expenses. Finally, this opportunity provides an incredible benefit for communities in need of your specialty expertise. For patients who can't or won't travel to a specialist, telemedicine enables them to access care they would otherwise be unable to receive, in their communities surrounded by their support network.

Telemedicine isn't for every practice; however, given the current environment related to equipment availability and reimbursement opportunity, this is a service that should be evaluated for consideration by your practice.

Pearl: Determine Eligibility

The Centers for Medicare & Medicaid Services (CMS) provides payment for "seeing" Medicare beneficiaries via telemedicine, but only if those patients are in a Health Professional Shortage Area (HPSA). You can access the federal government's Medicare Telehealth Payment Eligibility Analyzer to determine eligibility for Medicare payment, based on the location of the originating site, at
https://datawarehouse.hrsa.gov/tools/analyzers/geo/Telehealth.aspx.

Pearl: Join a Telemedicine Home-monitoring Pilot

In addition to "seeing" patients, telemedicine also forms the basis of home-monitoring programs. Used by both hospitals and medical practices, patients are provided tablets and biometric devices to track their blood pressure, weight, blood sugar and/or other vital signs. Patients can be monitored remotely, with providers able to respond before symptoms escalate. While reimbursement for this specific service may not be offered, or only provided by a small number of payers, research has proven that this use of home monitoring can improve quality of care, while reducing costs associated with readmissions and emergency department visits. Consider joining a telemedicine home-monitoring pilot, or work with your local hospital to determine opportunities for your practice to engage in this innovative model of supporting patients' care.

Pearl: Consider Leasing Equipment

If telemedicine piques your interest, but you don't want to sink a lot of money into this opportunity, leasing telemedicine equipment may be your best bet. Equipment leases are available from many vendors; some offer a more full-service option incorporating the facilitation of business as well.

Pearl: Talk to Hospitals about Partnering

It's likely that you can't call your friend who is a primary care physician across town, and start "seeing" his or her patients via telemedicine. In order to bill for services, most payers, including Medicare, require equipment on both ends (the "originating" site and the "host" site, the latter of which is your practice). Furthermore, for Medicare, the originating site must be in a rural Health Professional Shortage Area (HPSA) located either outside of a Metropolitan Statistical Area (MSA), in a rural census tract or a county outside of a MSA. If this is an opportunity you wish to pursue, take out a map and determine which areas might be appropriate for you to engage with a local hospital. Contact the hospital administrator in a qualifying area to determine if the facility has telemedicine equipment, as well as the interest in partnering with you. In addition to the community benefit, remind the hospital administrator that each encounter is billable from the originating site. 

United States