Telemedicine Report Cards Issued, Three States Flunked the Test

The American Telemedicine Association (ATA) released two reports that highlight gaps in coverage, reimbursement, physician practice standards, and licensure. The reports represent a novel approach to analyzing new content by identifying and comparing state policies. The reports included report cards where states are rated with grades ranging from A to F. The reports are designed to present the information in a simple and easy to use format. Jonathan Linkous, CEO of ATA, said in an ATA press release that the hope for the reports is “to showcase the states that are doing an excellent job when it comes to telemedicine, and to serve as a wake-up call to those who are failing to extend quality and affordable care to the residents of their state.”

Coverage and Reimbursement

The first report of the two focuses on how states succeed in their approaches to coverage and reimbursement for telemedicine. The report seeks to understand the success of states by analyzing state achievements with 13 indicators. The indicators include comparisons between telemedicine and in-person care, Medicaid’s use of telemedicine in the state, eligible telemedicine technologies available in the state, geographical restrictions, eligible providers, restrictions on telemedicine physician services, eligibility of mental and behavioral health services, and the eligibility of home health services.

For each indicator, states were assigned a grade of A through F as well as a composite grade for overall performance. Maryland, Maine, Mississippi, New Hampshire, New Mexico, Tennessee, and Virginia all received the highest composite scores, while Connecticut, Iowa, and Rhode Island received the lowest.

Physician Standards and Licensure

The second report details the differences between professional licensure portability and practice standards for telemedicine among states. It highlights the fact that differing state standards for physicians is one of the biggest challenges that telemedicine faces.The report analyzed state standards and policies that inhibit the use of telemedicine and assigned states a grade that is representative of the success of its current policies when compared to other states. State policies were analyzed against four indicators: physician-patient encounters, requirements to have a health care provider present during telemedicine encounters, informed consent requirements, and licensure.

As was the case with the first report, the standards and licensure report assigned individual grades for each indicator and a composite grade for each state. Twenty-three states and the District of Columbia were awarded the highest composite grade, indicating a landscape that is supportive of telemedicine. Twenty-seven states fell into the middle category which suggests those states have room to improve. One state, Alabama, received the lowest composite score.

Highlight on Kansas: Medicaid Privatization Dims the ‘Shining Star’ of Fraud Prevention

The privatization of Medicaid in Kansas is complicating the state’s ability to detect fraud and abuse in its $3 billion KanCare Medicaid program. According to a report from the Kansas Health Institute, when Kansas moved to a privatized Medicaid program in 2013, where Medicaid is offered through three private managed care companies, the state’s Medicaid fraud control unit was handed additional burdens that have obstructed the unit’s ability to effectively combat health care fraud. The Kansas attorney general’s Medicaid Fraud and Abuse Division 2014 Report sets out the cause of the inadequate fraud detection and points its finger at the three managed care companies who are reportedly not providing the state with adequate information to investigate abuse claims.


KanCare was devised as a cost saving mechanism in Kansas. The Medicaid program serves consumers through three managed care organizations that offer Medicaid plans. The KanCare health plans are Amerigroup of Kansas, Inc. (Amerigroup), Sunflower State Health Plan (Sunflower), and UnitedHealthcare Community Plan of Kansas (United). The two organizations in charge with oversight and administration of the program are the Kansas Department of Health and Environment (KDHE) and the Kansas Department for Aging and Disability Services (KDADS).


According to the report, the three managed care organizations are not submitting sufficient data to the state. Specifically, the attorney general reported that the managed care plans are providing incomplete and obscured claims data. The lack of adequate data is worsened by the fact that fraud investigators now have to navigate three separate organizations and three separate sets of rules and procedures when investigating claims of fraud. One example of failures in communication offered by the report was an instance where the Medicaid Fraud and Abuse Division was investigating a claim of fraud without awareness that all three of the managed care organizations either had or were in the process of their own investigation of the provider at issue.


Although KDHE, KDADS, and the state attorney general are aware of the problem, opinions differ as to how it should be corrected. According to the Kansas Health Institute, Kansas state Senator Jeff King said that a legislative reaction to the problem was a “last resort” despite the fact that he characterized the state’s Medicaid fraud unit as having historical been one of the “shining stars” of the state’s attorney general’s office. The Kansas Health Institute also reported that A.J. Kotich, a Democrat who is running against Kansas Attorney General Derek Schmidt’s in the state’s upcoming election, said that if he were elected he would “use the full authority of the office” to address the problem.

Bigger than Kansas

There are some suggestions that Kansas is not alone with its fraud control problems. A May, 2014, GAO report was devoted specifically to the fact that gaps are often developing in the tracking of Medicaid funds that are transferred through private organizations. A 2013 Medicaid Fraud Control Unit report from the HSS Office of Inspector General (OIG) highlighted similar concerns. Whatever the true cause of the inefficiencies, the problems plaguing federal and state healthcare programs are diverse and widespread. The states facing such issues need to act to correct what appear to be simple communication errors before they lead to more fundamental failures in the administration of Medicaid.


How Do You Expand Birth Control Access? Illinois Medicaid Program Would Pay Doctors More

Adding another layer of complexity to the current battle over birth control coverage in the United States, Illinois Governor Pat Quinn is seeking to improve access to birth control, particularly long-term birth control, for the state’s Medicaid beneficiaries. Currently the state’s Medicaid plan pays for 94 percent of the state’s births to teenage mothers and 54 percent of all deliveries. In 2012, average Medicaid costs per birth and the child’s first year of life was $18,500; those with low birth weights cost $302,000.

The Illinois Department of Healthcare and Family Services (HFS) has published its “Illinois Family Planning Action Plan” with a stated goal of “increasing access to family planning services for women and men in the Medicaid Program by providing comprehensive and continuous coverage to ensure that every pregnancy is a planned pregnancy”. HFS is accepting comments through September 15, 2014. The action plan provides for the following:


Action #1: Payments and operational policies reflect the value HFS places on providing the most effective form of contraception and will:

  • Double the provider reimbursement rate for intrauterine device insertion from $44 to $88;
  • Double the provider reimbursement rate for vasectomy service from $204 to $408;
  • Increase 340B medical providers’ dispensing fee for all long acting reversible contraceptives (LARC) from $20 to $35. Increase 340B medical providers’ dispensing fee for all hormonal contraceptives from $20 to $35 (three-month month supply required, except in extenuating circumstances);
  • Allow medical provider reimbursement (with modifier 25) for two services on the same day when one is a LARC procedure AND includes an initial or established annual exam or problem visit. Continue current practice allowing FQHCs to bill for one encounter rate;
  • Allow FQHCs to bill fee-for-service for permanent, non-surgical sterilization kits (Essure), consistent with LARC policy;
  • Investigate allowing hospitals to bill for LARC device insertion immediately postpartum.

Action #2: Health plans and providers in the Medicaid Program make all forms of family planning available to Medicaid clients in a convenient and seamless manner and will:

  • Communicate to all health plans and providers HFS’ commitment that clients receive evidence-based counseling and education on all FDA-approved contraceptives, from most-effective method to least-effective method [Informational Notice was sent to all Medical Assistance Providers on 6/26/14];
  • Communicate to all health plans and providers that cost sharing (co-pays/deductibles/co-insurance), step therapy failure requirements and prior authorization are not acceptable in the provision of family planning services [This was reflected in new and updated health plan contracts with most managed care entities];
  • Require annual submission of all health plans’ family planning policies to HFS, including referral policies by those plans with Right of Conscience objections to providing contraception;
  • Continue working with the LARC pharmaceutical industry to help ensure Medicaid providers have LARC inventory on the shelf for same day-insertion, with ongoing training, quality assurance and notice of any policy improvements;
  • Institute more effective communication regarding timely physician and FQHC reimbursements for current fee-for-service payments as well as contractual requirements for health plan payments.

The proposal has already drawn criticism from the Catholic church, who would be required under the plan to inform the state how they refer women elsewhere for services they do not provide. The Illinois Catholic Health Association, which represents 18 percent of hospitals in Illinois is worried that the plan will force Catholic hospitals from participating in the Medicaid program. The state of Illinois has previously ended contracts with Catholic groups for foster care when they referred gay couples to other agencies.

Trillions? Trillions! CMS Actuary Projects 2013 Spending at $2.9T

Health spending growth remained slow in 2013, with faster growth on the horizon due to the Patient Protection and Affordable Care Act’s (ACA) (P.L. 111-148) coverage expansion, economic growth and an aging population according to the CMS Office of the Actuary in a report published by Health Affairs on September 3, 2014. Sequestration, sluggish economic recovery and increases in private health insurance cost-sharing requirements attributed to the slow growth of 3.6 percent for health spending in 2013. Overall, in 2013 health care expenditures sponsored or paid for by the government (federal, state, and local) are expected to have reached $1.3 trillion, which is a 3.2 percent growth, as compared to 3.9 percent growth, or $1.6 trillion seen in spending by business, households and private sources.

Despite the slow growth in 2013, during the study’s full projection period of 2013 to 2023, national health expenditures are projected to increase at an average rate of 5.8 percent a year, which is 1.1 percentage point greater than the average annual growth rate in nominal gross domestic product. This is still slower than the growth rate from 1990 to 2008, which grew 2.0 percentage points faster than the gross domestic product growth. The 2023 projection for government financed health care costs is $2.5 trillion.

In 2013 Medicare spending growth slowed, decelerating from 4.8 percent to 3.3 percent. This is attributed to budget sequestration requirements and other payment adjustments. Growth in spending is projected to increase in 2014, due in large part to the additional nine million Americans who gained insurance through private health insurance plans and Medicaid. Looking ahead to 2015, the national health spending growth is expected to slow to 4.9 percent, due to “significant decelerations in Medicare and Medicaid spending.” Reduced payments to Medicare Advantage, or Medicare Part C plans, will contribute to the deceleration.

Total hospital spending growth is expected to slow from 4.9 percent in 2012 to 4.1 percent in 2013, which equals $918.8 billion. More drastically, Medicare hospital spending has slowed from 4.5 percent to 2.5 percent over the same time frame. The ACA has led to increased use of hospital services which should result in growth acceleration of 4.5 percent in 2014.