The COVID-19 pandemic has seen a wave of telehealth policy changes across the nation at both federal and state levels. Such changes have expanded access to health care and addressed underutilization in chronic disease management while minimizing the risk of exposure for individuals seeking care. One such policy change in particular has received widespread attention and support from industry stakeholders and lawmakers alike: expansion of telehealth to include audio-only telephonic communications. However, the longevity of telehealth’s expansion to audio-only services remains uncertain as states and the federal government each pursue revisions to pandemic-era policies and flexibilities.

Temporary Telehealth Expansion during the Pandemic

Prior to the pandemic, few state and federal laws required coverage of and reimbursement for telehealth services delivered through audio-only modalities. This changed during the pandemic as the federal government and many state governments issued waivers, executive orders, and guidance, and some states passed legislation, that allowed providers to use telephone and other audio-only technologies to deliver services that do not require a physical or visual exam, where clinically appropriate. This expansion of telehealth addressed significant gaps in access to care, especially among large segments of the population without broadband internet access who are disproportionately low-income and underserved populations.

Notably, the Centers for Medicare and Medicaid Services (“CMS”) added via an interim final rule temporary coverage for audio-only telehealth evaluation and management services and issued a list of services for which audio-only telehealth could be used in lieu of audio-visual (i.e., video) telehealth during the pandemic for Medicare patients. State Medicaid programs, many of which did not cover audio-only telehealth prior to the pandemic, followed suit in expanding coverage to include varying degrees of audio-only telehealth services. Additional state telehealth changes range both in scope, from requiring payment and coverage parity among private payors to loosening location and modality requirements for telehealth, and in permanency, from temporary waivers and orders to enacted legislation and new regulations.

2021 Trends: The States, New York’s Plan, and Federal Policy

As discussed in a prior blog post, state policymakers seem to be proposing new legislation or regulations almost weekly to revamp their states’ telehealth frameworks. As pandemic-era waivers and executive orders expire, these more formal policy proposals often seek to make permanent the pandemic-era telehealth flexibilities or otherwise expand the scope of and reduce barriers to accessing telehealth services. Many proposals removing restrictions on or expressly allowing audio-only telehealth have already become law (e.g., in Nebraska and Oklahoma).

Similarly, New York made audio-only telehealth services a permanent addition to its definition of telehealth with the enactment of Senate Bill S8416 in the summer of 2020. This bill and the pandemic seem to have kick-started a wave of telehealth action in the state. On January 10, 2021, Governor Cuomo announced his proposal to further expand access to telehealth services through additional legislative and regulatory measures. This proposal has four broad parts: (1) Unlocking the Benefits of Telehealth Through Policy Modernization; (2) Ensuring Coverage and Reimbursement for Telehealth; (3) Expanding the Use of Technological Advancements in Health Care; and (4) Supporting Patients and Providers Through Professional Development, Education, and Innovative Support Programs.

One clear aim of this proposal is to support the prior expansion of audio-only telehealth services in New York and incentivize the use of such services and telehealth writ large. The proposal specifically calls for mandating commercial payors to offer a telehealth program to members, and provide Medicaid coverage, subject to federal approval, to cover services furnished telephonically when medically appropriate. Among other telehealth changes, the proposal also seeks to (i) require Medicaid reimbursement for telehealth services irrespective of the patient’s or provider’s location; (ii) develop licensure reciprocity with neighboring Northeast states for medical and behavioral health providers; (iii) require payors to disclose which network providers offer telehealth and mandate that telehealth platforms participate in the Statewide Health Information Network for New York; (iv) mandate that insurers offer an e-triage virtual emergency department to provide patients with assessments and referrals via telehealth; and (v) eliminate any requirements for in-person evaluations prior to rendering or receiving telehealth services, when clinically appropriate. To support these initiatives, the proposal also calls for increased patient and provider training to increase uptake and comfort with the use of telehealth delivery systems.

New York’s state legislators appear to have followed the Governor’s lead. Currently, there are no less than 10 bills introduced since the turn of the year that would further amend New York telehealth statutes. For example, Senate Bill S02990 is one of at least six bills that would explicitly require payment parity for telehealth services (which now include audio-only telehealth) as compared to in-office visits. Other bills specifically target changes to telehealth in the contexts of Medicaid and behavioral health.

While New York and other states go full steam ahead in expanding telehealth, the federal government appears to be lagging behind in permanently adopting telehealth flexibilities that emerged during the pandemic. The Medicare Physician Fee Schedule final rule, published December 1, 2020 (the “2021 PFS”), made numerous changes to Medicare telehealth reimbursement policies, but notably did not extend Medicare coverage and reimbursement to audio-only telehealth services delivered to Medicare beneficiaries. The 2021 PFS therefore rolls back pandemic-era expansions of coverage and reimbursement for evaluation and management services delivered through audio-only telehealth, effective following the end of the federal public health emergency. It should be noted that the 2021 PFS did, however, provide additional virtual check-in codes, which include audio-only check-ins, that providers may use to bill for longer audio-only check-ins than was previously the case.

Congress, of course, has its own plans to adopt additional telehealth flexibilities. As urged by high-profile stakeholder associations like the American Medical Association, America’s Health Insurance Plans, and the American Hospital Association, among others, various bills have been introduced to modernize the federal government’s approach to telehealth coverage and payment. Importantly, bills such as the “Ensuring Parity in MA and PACE for Audio-Only Telehealth Act of 2021” and the “Creating Opportunities Now for Necessary and Effective Care Technologies (CONNECT) for Health Act of 2021” have bipartisan support, though it remains to be seen if concrete legislative action will materialize this year.

Hearing, Not Seeing: What’s Next for Policy Change?

Significant roadblocks still exist to realizing permanent action on audio-only telehealth expansion at both the state and federal levels. These include worries from lawmakers that expanding access and payment parity to audio-only telehealth will lead to overutilization, inappropriate care delivery or confusion and a lack of uniformity regarding clinical standards, lower quality care, and fraud. As the debate continues, lawmakers might consider certain measures tailored to address these concerns, such as improving oversight and audit authority and capacity related to audio-only telehealth, narrowing coverage and parity requirements to apply to services vetted by clinical experts and government authorities as clinically appropriate for audio-only telehealth, updating consent requirements and adjusting geographic location requirements, and, for Congress specifically, refining risk adjustment processes for Medicare Advantage members to account for use of audio-only telehealth.

The bottom line is that states are charging ahead of the federal government in expanding access to telehealth services for commercial payor members and Medicaid beneficiaries, especially when services are delivered through audio-only modalities. Meanwhile, the federal government appears to be lagging in adopting a permanent approach to telehealth expansion, and is focusing its efforts on Medicare and Medicare Advantage policy for the time being. The result is likely to be a disconnected patchwork of policies across states and the federal government, making cross-border telehealth delivery (professional licensing regulations aside) a minefield of disparate laws and regulations for providers still reeling from the COVID-19 pandemic.

Photo of Daniel S. Weinstein Daniel S. Weinstein

Daniel Weinstein is an associate in the Corporate Department and a member of the Health Care Group. His practice focuses on representing health care clients, including hospitals and health systems, academic medical centers, physician organizations, telehealth platforms, and digital health companies. Daniel provides…

Daniel Weinstein is an associate in the Corporate Department and a member of the Health Care Group. His practice focuses on representing health care clients, including hospitals and health systems, academic medical centers, physician organizations, telehealth platforms, and digital health companies. Daniel provides legal advice on a wide range of regulatory, corporate, and transactional matters, such as Medicare/Medicaid reimbursement, fraud and abuse compliance, managed care contracting, value-based payment arrangements, HIPAA, practice expansions, and general corporate and business planning.

Daniel maintains an active pro bono practice, which includes representing veterans seeking disability benefits and leading Election Protection call centers. He is also an active member in the NYC Bar Association’s health law committees.

Daniel earned his J.D. from NYU School of Law, where he was President of the Health Law & Policy Society and a Notes Editor for the NYU Journal of Legislation & Public Policy. Prior to law school, Daniel worked as a health care policy consultant at both NORC at the University of Chicago and Navigant Consulting. Daniel received his B.A. in Political Science and Community Health from Tufts University, graduating summa cum laude.

Photo of Edward S. Kornreich Edward S. Kornreich

Past long-standing chair of Proskauer’s Health Care Department, Ed Kornreich is a recognized authority on the legal, regulatory and business issues related to health care services.

Ed works primarily on health care transactions, regulatory compliance, health care payment and governance issues for varied…

Past long-standing chair of Proskauer’s Health Care Department, Ed Kornreich is a recognized authority on the legal, regulatory and business issues related to health care services.

Ed works primarily on health care transactions, regulatory compliance, health care payment and governance issues for varied providers (both for-profit and not-for-profit), vendors, GPOs, distributors and entrepreneurs. His approach combines sensitivity to meeting regulatory business goals with a comprehensive and realistic assessment of the health care environment, and he is particularly experienced in dealing with the complex issues related to integrated health care systems.

After working for the Legal Aid Society, Ed entered private practice, where he helped represent a major public hospital corporation in a series of reimbursement disputes with the state and federal governments, and counseled New York area hospitals and nursing homes on reimbursement and operational issues. Thereafter, Ed served as General Counsel of St. Luke’s-Roosevelt Hospital Center, one of the largest teaching hospitals in New York. After leaving St. Luke’s-Roosevelt Hospital Center, Ed joined Proskauer as a Partner in 1990.

Ed frequently writes and lectures on Medicare and Medicaid reimbursement, health care integration, not-for-profit law and corporate governance issues, and the application of federal and state anti-kickback and “Stark” laws to health care transactions.