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Kansas Insurers And Hospitals Wrestle Over How Much Your Telehealth Visit Should Cost

A photo shows a stethoscope laying on a laptop.
Carlos Moreno
KCUR 89.3

A dizzying array of temporary policy changes at the state and federal levels eased the switch to health care over telephones and laptops during the pandemic, but they may not last.

Ansel Armstrong had just found a psychologist when COVID-19 turned the world upside down, forcing in-person care to go remote.

So video sessions replaced a 40-minute drive between Lawrence and Topeka.

“I love how much it frees up my schedule,” Armstrong said. It eased the process in other ways, too. “It’s like, you’re at home. I have my cat on my lap. I think it was a less stressful experience.”

A wide range of medical and mental health care weathered the forced exodus from bricks and mortar to the online realm during the pandemic. Many patients appreciated the convenience. Many doctors found it effective.

Government and private insurers mostly embraced the switch and, in light of the crisis, paid physicians and other providers the same for an online visit as an office exam.

But that will change after the pandemic. Though different health plans will take different approaches, overall, doctors will likely — as they did before the pandemic — get paid less for most telehealth than what they do in person.

And players in the industry are divided over whether that will make care over phone and video rarer again.

Patients don’t all want telehealth, but the vast majority want to keep the option on the table.

“They like it,” said Jennifer Findley, a vice president of the Kansas Hospital Association. “They like it and they want it to continue.”

Meanwhile, whether traditional health care providers in Kansas offer remote services or not, major out-of-state companies that specialize in offering it at lower rates will do so. And that will give local providers a run for their money.

How we got here

When the pandemic hit and doctors, clinics and hospitals had to go remote for as much care as possible to save lives, it forced a range of piecemeal changes to telehealth rules.

They involved a head-spinning array of largely temporary actions by federal and state agencies, legislatures, governors and private companies, each of which affected different sections of the nation’s complex insurance market — Medicare, Medicaid, federally regulated large employer plans and other kinds of state-regulated commercial insurance — in different ways.

Just a few examples:

  • Federal and state rules relaxed to let people on Medicare and Medicaid get care from home and to allow more Medicare telehealth outside of rural areas that were previously the focus.
  • It became easier to get a prescription without setting foot in a doctor’s office, or to talk to a doctor in another state.
  • And the feds cut doctors slack on strict privacy protections to let them connect with patients on familiar platforms like Skype, Zoom and smartphone video calls. They could bill for more care provided without video on plain old telephones.

Health advocates want many of the changes — some of which have clear expiration dates, others of which remain more ambiguous — to stick around. Patients don’t always have reliable internet, for example.

“They might not even have a smartphone,” said Andrea Perdomo-Morales, chief program officer at a community clinic in Wyandotte County, Vibrant Health. “It could just be a flip phone or something of that nature.”

One especially big change brought on by the pandemic: Medicare paid doctors the same rates they’d earn for in-person care. In Kansas, several private insurers voluntarily did the same.

“We want to make sure that they don’t go away,” said Sunee Mickle, a vice president at Blue Cross Blue Shield of Kansas. “That they’re able to pay their bills.”

But health plans largely will not keep paying as though those patients are walking in the door once COVID fades.

Whether they even should is a matter of debate, and public officials worried about the ever-rising cost of American health care may not have the appetite to force them to pay full price for online care.

“There’s a lot of resistance from policymakers … to say, ‘OK, yeah. We’re going to reimburse something — that we know the unit costs are lower — at the same rate as an in-person visit,’” Robert Wood Johnson Foundation senior policy advisor Katherine Hempstead said. “That’s a tough sell.”

What’s telehealth worth?

To be clear, Hempstead doesn’t mean offering care over video or telephone is always cheaper than in-person care. But sometimes it is — particularly with the advent of large, specialized telehealth companies.

Those national (and even international) companies keep costs low by ditching bricks and mortar, scaling up and contracting directly with insurance companies and employers to offer people a quick connection to care, sometimes with lower copays.

“That’s obviously advantageous to the (insurance) plan,” Hempstead said. “It’s not good for your local providers, clearly.”

The traditional health care providers that lose out argue that this burgeoning telehealth-only sector isn’t good for patients either. They say it splinters care by steering people toward distant doctors who don’t know their medical history — and leaving those that do out of the loop.

Kansas and other states already face a shortage of primary care doctors. So depending on whom you ask, telehealth conglomerates could either help fill a gap or exacerbate it by making the financial prospects of running a local family medicine or mental health practice even less appealing or feasible.

Telemedicine isn’t as easy as it might sound. Just paying for or creating a platform that conforms with federal privacy rules, known as HIPAA, to communicate with patients can be a significant investment. The current, temporary looser rules that allow easy communication over simple Facetime calls during the pandemic aren’t the norm.

Kansas hospitals and doctors urged lawmakers this session to help make private insurance plans keep paying them the same for care regardless of whether it happens in person or not. Paying the same for both was standard in 10 states even before the pandemic, the Kaiser Family Foundation says.

State lawmakers can’t control what Medicare or many large employers pay, but they do have sway over some private insurance, in addition to Medicaid.

But insurance companies argue the state shouldn’t get involved in prices normally settled by the commercial market — certainly not to raise them.

“It doesn't do anything to bring more value to the care,” said Mickle, from Blue Cross of Kansas. “It just increases the cost for everyone.”

Blue Cross currently expects to stop paying in-person rates for remote care in late June, though Mickle said it will continue to pay higher sums to traditional doctors than to telehealth-only vendors, in recognition of their higher costs.

So what about Medicaid and Medicare?

Kansas Medicaid, which generally pays far less for all manner of care than Medicare or private plans do, is poised to keep paying for telehealth at its in-person rates. Medicare appears ready to do the same for select services.

Telehealth boom

Estimates vary, but a number of analyses suggest people used telehealth rarely — until the pandemic.

The Kansas Health Institute notes Medicare data show a dramatic leap from fewer than 1% of primary care visits relying on telehealth in February last year, to more than 40% a few months later.

The University of Kansas Health System says it conducted fewer than 100 visits a month through telemedicine before COVID struck, leading to as many as 35,000 remote visits in a single month.

“We continue to see no less than 16,500 telemedicine visits per month,” the hospital system wrote to lawmakers in February, urging them to make insurers keep current payment policies or else it would be “impossible for hospitals to continue to subsidize telemedicine when it is in high demand.”

Many patients are returning to in-person care, but telehealth (especially for mental health services) remains more popular than before COVID-19.

A recent poll of Kansans commissioned by the United Methodist Health Ministry Fund and REACH Healthcare Foundation — funders of the Kansas News Service — found half of respondents have used telehealth.

But whether they have or not, the vast majority want to know that if they someday need to talk to a specialist over a laptop from their kitchen table, they’ll be able to.

Many doctors like it, too. Some forged ahead well before the pandemic and managed to make it work financially.

“It’s kind of been a paradigm shift for a lot of people, realizing that in-person visits probably aren't as necessary as we’ve been used to and trained for,” said Hazen Short, a doctor whose practice in Wyandotte County uses a business model called direct primary care that bypasses insurance by charging patients a flat monthly rate.

Short says around half of his visits happened over phone or video even before the pandemic. In cases where either would work, patients got to pick what suited them best.

“A lot more medicine can be done remotely,” Short said, “than we thought previously.”

At a meeting in the Legislature, the Kansas Hospital Association suggested unsuccessfully that health plans continue paying the current pandemic-era reimbursement rates for select telehealth services for the next year so that a third party could then study how it affected costs.

The association points to research suggesting that costs could come out lower for some patients. If telehealth keeps a chronically ill person out of the emergency room, for example, that saves significant cash.

“I’m also really concerned about just leaving this up to market forces,” Findley told lawmakers, adding that 91 of the state’s 122 hospitals are small, rural facilities.

“They often have no power to negotiate rates,” she said. “They have to take what the insurance company gives them and just accept it.”

Celia Llopis-Jepsen reports on consumer health for the Kansas News Service.

You can follow her on Twitter @celia_LJ or email her at celia (at) kcur (dot) org. The Kansas News Service is a collaboration of KCUR, Kansas Public Radio, KMUW and High Plains Public Radio focused on health, the social determinants of health and their connection to public policy.

Kansas News Service stories and photos may be republished by news media at no cost with proper attribution and a link to ksnewsservice.org.

I'm the creator of the environmental podcast Up From Dust. I write about how the world is transforming around us, from topsoil loss and invasive species to climate change. My goal is to explain why these stories matter to Kansas, and to report on the farmers, ranchers, scientists and other engaged people working to make Kansas more resilient. Email me at celia@kcur.org.
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