Progress Toward Reimbursement for Telehealth

By Alpha Lillstrom
May 5, 2016

These days more providers, patients, and payers are evaluating the utility and benefits of using technology to support or provide health care services remotely. The use of telehealth is a significant and rapidly growing component of health care in the United States. Also known as telemedicine, the term encompasses everything from electronic visits, video technology, and remote monitoring to provide maintenance and preventive care for patients, to diagnosis and treatment when it is clinically appropriate. In some cases telehealth is used to provide access to care over distances that would otherwise present insurmountable obstacles to care. In other situations the technology improves convenience for both the provider and the patient. Over half of U.S. hospitals now use some form of telemedicine.1 In fiscal year 2013, more than 600,000 veterans accessed Veterans Affairs (VA) care using a telemedicine program—for a total of more than 1.7 million episodes of care.2 Even when effective mitigation of challenges is taken into account, reimbursement continues to present the most formidable obstacle.3 While your specific practice might not yet be delving into providing care using telemedicine, some are. Policy is evolving to make it more feasible and reimbursable.

Twenty-nine states and the District of Columbia require parity for telehealth services, meaning that private insurers must cover care provided via telehealth to the same extent as they cover in-person services.4 Most state Medicaid programs recognize that telehealth is simply a different mechanism through which to deliver a covered service, not strictly a supplement or complement to face-to-face encounters, and therefore they provide some level of reimbursement for telehealth—particularly for real-time interactive video visits.5 In some states the coverage for care provided to Medicaid beneficiaries exceeds that of private insurers.6 While many private insurers cover at least some telehealth services, many more have expressed interest in expanding the scope of their telehealth coverage.

Despite progress elsewhere, current Medicare law provides very limited reimbursement for telemedicine services. This coverage is largely confined to physician services provided in rural areas,7 and only in a prescribed list of facilities. Less than one percent of Medicare beneficiaries receive their care remotely.8 In order to access care through an interactive two-way telecommunications system (with real-time audio and video), the patient must be located at an authorized originating site such as a doctor’s office, hospital, critical access hospital, rural health clinic, a hospital-based dialysis facility, skilled nursing facility, or community mental health center.9 Physical therapy clinics are not currently an authorized originating site. At this time, physical therapists are also not included in the list of distant-site practitioners able to furnish services and receive payment for covered telehealth services.

Every two years, before each new Congress is sworn in, the Private Practice Section (PPS) Board of Directors and Government Affairs Committee (GAC) members meet to update the section’s legislative priorities. The discussion takes into consideration recent policy developments and the business environment, as well as the expected priorities and policy focus of the upcoming Congress. For example, for this current (114th) Congress, both the House and Senate are controlled by members of the Republican Party. Understanding the legislative inclinations of the majority allowed the Board and the GAC to develop a list of policy priorities, as well as realistic expectations for which of those goals were most likely to be realized. Your PPS lobbyists use these priorities to guide their efforts when engaging members of Congress and agency representatives. When bills are introduced that are relevant to these PPS legislative priorities, the GAC and Board consider whether or not to support and endorse those bills. If PPS endorses a bill, your lobbyists will then actively engage members of Congress in support of the legislation on behalf of PPS members.

The legislative priorities of the 114th Congress include the following: “Achieve legislation that allows reimbursement through Medicare and Federal Health plans for physical therapy care through telehealth.”10 In this Congress, three bills relating to telehealth have been evaluated and endorsed by PPS.

Furthering Access to Stroke Telemedicine (FAST) Act

“Telestroke”—the use of telemedicine in the treatment of stroke—has proven highly effective in improving patient access to quality stroke care. However, a number of barriers remain that rob patients of treatment that can improve their lives, prevent long-term disability, and reduce the need for extensive physical therapy. Current law only allows Medicare reimbursement for telestroke services provided to a patient in a rural medical facility. The law does not cover those same services if the patient presents with symptoms at a nonregistered originating site that is located in an urban or suburban area. This rural-focused policy was implemented as a safety net for those individuals living far away from medical facilities that were fully equipped to evaluate a stroke. However, approximately 94 percent of strokes occur in an urban or suburban area.11 Time is of the essence; interventions to mitigate the effects of a stroke must be administered within three to four-and-a-half hours after symptom onset.12 If all facilities were able to send scans for analysis off site, patients could be diagnosed and treated faster, thereby reducing the severity of lingering health issues and the amount of necessary rehabilitative care.

Last year, PPS endorsed the bipartisan Furthering Access to Stroke Telemedicine (FAST) Act of 2015 (H.R.2799/S.1465), which was introduced by Representatives Morgan Griffith (R-VA) and Joyce Beatty (D-OH), and Senator Mark Kirk (R-IL). This legislation would provide for Medicare reimbursement for the telestroke consultation—regardless of the location of the hospital where the patient presents with stroke symptoms. Additionally, the existing originating site facility fee would not apply.13 The Medicare Payment Advisory Commission (MedPAC) recently stated that the first area they anticipate Medicare will expand coverage would be stroke assessment, in part because it has the lowest risk for inappropriate utilization.14 The FAST Act continues to gain support in the House (it had 69 cosponsors at the beginning of April) while the Senate bill is stagnant with only its 2 original sponsors—Senators Mark Kirk (R-IL) and John Thune (R-SD).

CONNECT for Health Act

After identifying the need for more comprehensive coverage for telehealth services, a bipartisan group of six senators formulated a bill that would expand Medicare coverage of health care services provided remotely. On February 2, 2016, Senators Brian Schatz (D-HI), Roger Wicker (R-MS), Ben Cardin (D-MD), John Thune (R-SD), Mark Warner (D-VA), and Thad Cochran (R-MS) introduced the CONNECT for Health Act (S.2484). The following day, Representatives Diane Black (R-TN), Peter Welch (D-VT), Gregg Harper (R-MS), and Mike Thompson (D-CA) introduced the companion bill (H.R.4442), which has quickly gained cosponsors. Before leaving for the spring recess, H.R.4442 had 16 cosponsors, and the Senate bill added 1 additional cosponsor.

The CONNECT for Health Act expands reimbursement for services provided through real-time exchange of information via a telecommunications system as well as remote patient monitoring. The legislation contains three provisions relevant to our PPS legislative priorities. The first would empower Medicare Part C (also known as Medicare Advantage or MA) plans to offer telehealth services as a basic benefit without most of the current restrictions placed on the coverage of telehealth services. The use of telehealth technologies is currently categorized as a service, not as an alternative modality or complementary means of providing clinical services; therefore, at this time the use of remote access technologies is considered a supplemental benefit in MA.15 If telehealth were a basic benefit, a Medicare beneficiary would receive care via a telecommunications system as a substitute for a face-to-face or “hands-on” encounter without incurring additional fees. Likewise, Medicare-enrolled providers, including physical therapists, would be reimbursed by Medicare Advantage plans for care provided using telehealth.

These bills also include a demonstration project that would provide coverage for telehealth as a Medicare Part B benefit, free from the rural limitation and requirement that patient care originate in a specific type of medical setting. Unfortunately, participation in this program is limited to those eligible professionals who will be using the Merit-Based Incentive Payment System (MIPS) and providers who are participating in an alternative payment model. As you know, the MIPS was a part of the Medicare Access and Children’s Healthcare Insurance Program (CHIP) Reauthorization Act (MACRA)16, the legislation that repealed the dysfunctional sustainable growth rate (SGR) formula. However, physical therapists will not be included in MIPS until 2019 at the earliest. Due, in part, to PPS lobbyists pointing out this limitation, the CONNECT Act contains a provision that grants the Secretary of Health and Human Services the authority to use rulemaking to expand the program to additional eligible providers, including physical therapists.

Finally, the CONNECT Act also includes a section to strike site origination fees and the geographic limitations for providing stroke assessment via telehealth. This bill language echoes the bipartisan Furthering Access to Stroke Telemedicine (FAST) Act discussed earlier.

The bills intend to promote cost savings and improve the quality of care in Medicare through the use of telehealth and remote patient monitoring. An additional goal is to make it more convenient for patients to connect with their providers by increasing Medicare utilization of telehealth.

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Medicare Telehealth Parity Act

The Medicare Telehealth Parity Act (H.R.2948), introduced by Representative Mike Thompson (D-CA) and Gregg Harper (R-MS), seeks to expand telehealth access for Medicare patients. The legislation expands the category of originating site to rural health clinics and federally qualified health centers, but does not go as far as to include private practice locations. However, the bill would add physical therapists and several other therapy provider groups to the list of authorized telehealth providers under Medicare. This bipartisan bill has 29 cosponsors. There is no Senate companion at this point.


The value of telehealth is shared by all those involved. Telehealth services provide more timely access to health care services while reducing travel for both patients and clinicians. This is especially true in rural locations and for those many seniors who must rely on friends, family, or caregivers to provide transportation to health care providers.

The Medicare Telehealth Parity Act is the most promising of the bills in that physical therapists are specifically included in the list of providers to be reimbursed for telehealth services. The FAST and CONNECT for Health Acts do not directly empower physical therapists to be reimbursed when providing physical therapy care through telehealth, but they are both a step in that direction. If these bills pique your interest, please reach out to your members of congress and ask them to sign on as a cosponsor of these important bills. Your elected officials need to hear from you in order to fulfill their responsibility of representing the needs and priorities of their constituents. Feel free to share anecdotes of how you have used (or could use) telehealth when treating some patients and how those tools would benefit your Medicare beneficiaries. If you have any questions about the issues themselves, or how best to engage with your legislators, please ask your PPS lobbyists for assistance. Consistent with the current PPS Advocacy Priorities, we will continue our efforts to include private practice physical therapists in upcoming policy developments that reflect the increased use of telehealth as a cost-effective means of service delivery throughout the country.

Talking Points for Contacting Congress

Furthering Access to Stroke Telemedicine (FAST) Act of 2015 (H.R.2799/S.1465*):

Allow Medicare beneficiaries to receive stroke evaluations via telemedicine—regardless of location. If all facilities were able to send scans for analysis off site, patients could be diagnosed and treated faster, thereby reducing the severity of lingering health issues and the amount of necessary rehabilitative care.

CONNECT for Health Act of 2016 (H.R.4442/S.2484):

Expand the use of telehealth and remote patient monitoring services in Medicare in pursuit of both cost savings and improving the quality of care. Current law restricts telehealth coverage and reimbursement based on geography and the type of facility caring for an eligible Medicare beneficiary at the time of service. Access is further bound by the types of providers and limited reimbursable telehealth codes. Please expand Medicare coverage of telehealth services and increase patient access to necessary care.

Medicare Telehealth Parity Act (H.R.2948)

Expand telehealth access for Medicare patients by adding physical therapists and several other therapy provider groups to the list of authorized telehealth providers under Medicare. Current law limits the types of providers who are reimbursed for telehealth coverage. Please expand the list of providers able to bill Medicare for telehealth services and thereby increase patient access to necessary care.

*All bill numbers and cosponsor lists are hyperlinks and will lead you to the real-time list of cosponsors.


1. Accessed April 2016.

2. Accessed April 2016.

3. Accessed April 2016.

4. Accessed April 2016.

5. Accessed April 2016.

6. Check your state’s scorecard on the American Telemedicine Association for more details:—coverage-and-reimbursement.pdf?sfvrsn=10. Accessed April 2016.

7. “Rural” is defined as a Health Professional Shortage Area (HPSA) or in a county that is outside of any Metropolitan Statistical Area (MSA), defined by HRSA and the Census Bureau, respectively.

8. Accessed April 2016.

9. Accessed April 2016.

10.[Ltrhd].pdf. Accessed April 2016.


12. The recommended treatment for acute stroke, the clot-dissolving drug tPA, is now available to treat the most common type of stroke. Accessed April 2016.

13. This provision is based on Section 105(a)(1) of the Telehealth Enhancement Act (H.R.3306/S.2662 in the 113th Congress). Accessed April 2016.

14. Oral discussion, March 2016 public meeting of MedPAC. Accessed April 2016.




Alpha Lillstrom is a registered federal lobbyist working with Connolly Strategies & Initiatives, which has been retained by PPS. An attorney by training, she provides guidance to companies, nonprofit organizations, and political campaigns. For six years, she served as Senior Policy Advisor and Counsel for Health, Judiciary, and Education issues for Senator Jon Tester (Montana), advising and contributing to the development of the Affordable Care Act, as well as working on issues of election law, privacy, government transparency, and accountability. Alpha has also directed Voter Protection efforts for Senators Bob Casey, Al Franken, Russ Feingold, and Mark Begich. She was Senator Franken’s Policy Director during his first campaign and was hand-picked to be the Recount Director for his eventual 312-vote win in 2009.

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