Regulations and reimbursement for telemedicine are quickly evolving to keep pace with patient demand and technology. This section reviews the core concepts that providers should be cognizant of when practicing teledermatology.
Credentialing and Privileging
Credentialing and privileging refers to the assessment of a provider's qualifications and competence. In 2011, CMS issued a Final Rule that included two components that promoted telemedicine adoption in hospitals and CAHs. The Final Rule allowed providers to deliver telemedicine services to patients through written agreements with a distant-site hospital or a distant-site telemedicine entity. The Final Rule also streamlined credentialing and privileging for telemedicine providers and allowed hospitals and CAHs to rely, when granting telemedicine privileges, upon the privileging decisions of a distant-site hospital or telemedicine entity where they have a written agreement that meets Medicare requirements. This aligned CMS with the privileging by proxy standards initially set forth by The Joint Commission. 7
Regulation of prescriptions obtained virtually varies significantly with state legislation, as well as by state medical and pharmacy boards. Policies have been created to protect patients from online “pill mills.” At the time of this publication, 12 states allowed electronic means to establish the patient–physician relationship and exam. Few states require an in-person follow-up appointment after a telemedicine encounter. There are no requirements to obtain patient information regarding underlying past medical history, allergies, drug adverse effects, other medications and potential drug interactions, contraindications, and safety in pregnancy or lactation. Patient safety and ethical concerns arise from whether an appropriate patient–provider relationship is established; the adequacy of the physical exam; patient education on the diagnosis, risks, benefits, and alternatives of treatment and follow-up if adverse events occur; and continuity and coordination of care with the patient's other health care providers.
Telemedicine possesses the same duty of care as traditional in-person medicine does. To date, there have been no legal actions concerning teledermatology. There is much debate surrounding clinical and quality standards of care in telemedicine and whether it should or should not differ from that of traditional in-person medicine. Prior to practicing teledermatology, it is prudent to contact one's liability carrier to discuss specific plans (technical modality, patient populations, prescription capacity, etc.) and whether current or supplemental coverage is sufficient.
In traditional fee-for-service models, reimbursement has expanded with the passage of parity laws that apply to private insurers and self-pay with the emergence of DTP/DTC care. Parity laws can include coverage parity that mandates telemedicine services be covered to the same extent and in the same manner as in-person services and/or payment parity that requires the same rate of payment for services delivered via telehealth. Twenty-nine states have parity laws for private insurers, and there is a trend towards removing eligible provider, technology, and patient setting restrictions for reimbursement. With the explosive growth in direct care teledermatology services and prevalence of high-deductible insurance plans, many patients are paying out of pocket or using flexible spending accounts for their teledermatology care. In a recent study by Fogel and Sarin, asynchronous, store-and-forward teledermatology consultations typically range from $25 to $100 per encounter. 8
Reimbursement by federal payors such as Medicare and Medicaid lags behind private payors and has significant room for improvement. Medicare currently reimburses live interactive teledermatology encounters with geographic restrictions to health professional shortage areas (HPSAs) and only reimburses store-and-forward teledermatology in Alaska and Hawaii. In addition to geographic restrictions, Medicare limits the type of eligible providers and eligible facilities that it will reimburse. Medicaid coverage resembles Medicare coverage in its preference for live interactive modalities, and only nine states reimburse for store-and-forward technologies. Medicaid is even more restricted than that of Medicare with significant geographic restrictions, limited eligible patient populations, eligible providers, authorized technologies, and patient consent. Forty-eight state Medicaid programs have some type of coverage for telemedicine, which includes a number of states covering store-and-forward teledermatology (as of 2016). One area of expanded coverage is reimbursement for telemedicine under state employee health plans. Twenty-four states now (as of 2016) have some type of coverage for telehealth under one or more state employee health plans. 9
With the enactment of MACRA in 2015, there is an increasing focus on value-based reimbursement models and alternative payment models such as capitation, bundled payments, shared savings, medical home model, or pay for performance. A recent study by Rosen et al. demonstrates the feasibility and viability of such business models as well as traditional reimbursement schemes in teledermatology. 10
With an increasing focus on population health management and value-based care, telehealth will continue to be a popular topic for state and federal legislation in the foreseeable future. The definition, appropriate use, licensure, and reimbursement of telehealth are quickly evolving in an attempt to catch up with the pace of practice.