State Policies Influence Medicare Telemedicine Utilization

Area of Science:

• Health Policy
• Telemedicine
• Healthcare Economics

Background:

• Medicare telemedicine reimbursement policies have remained largely unchanged since 2000.
• Individual states have increasingly expanded telemedicine reimbursement for Medicaid and commercial payers.
• Telemedicine programs serve diverse patient populations, making state policy impacts crucial for overall program viability.

Purpose of the Study:

• To investigate the impact of state-level policy changes on Medicare telemedicine utilization.
• To analyze the effects of expanded Medicaid telemedicine coverage and commercial payer telemedicine parity on Medicare services.

Main Methods:

• Analysis of Medicare claims data from 2011-2013 in the Great Lakes region.
• Extraction and linkage of live interactive telemedicine professional fee claims to their states of origin.
• Calculation of allowed encounters and expenditures, standardized per 1,000 members per year.

Main Results:

• Medicare telemedicine encounters and expenditures increased significantly in states with policy changes.
• Illinois saw a 173% rise in Medicare telemedicine utilization after Medicaid coverage expansion.
• Michigan experienced a 118% increase following commercial payer telemedicine parity adoption.

Conclusions:

• State-level telemedicine reimbursement policies significantly influence the practical viability of telemedicine programs billing Medicare.
• Despite stagnant federal policy, state actions demonstrate a powerful effect on telemedicine adoption and utilization across payers.