Telehealth: Insurance & Legal Considerations

Connor D. Jackson JD

Connor D. Jackson, a Chicago-based healthcare attorney, serves independent practices. Visit his firm’s website to learn more.

Consider whether telehealth services are included in your insurance. InsuranceThese are three important issues to be aware of. There are many requirements that can be met by different states, insurance companies, professions, or claims. Thus, something that might cause one claim to be denied could be irrelevant to another claim’s approval. It’s important to know what questions to ask and what the answers mean for your practice’s procedures.

1. Is it covered? Will I be paid?

First, check to see if your state has passed telehealth insurance parity legislations. These laws often require parity between types of services or the value of reimbursement. For example, Coverage parityInsurers must cover telehealth-based services they cover when they are offered in the office. If the state requires it, payment parityTelehealth services are reimbursed by insurers at the same rate that in-person visits. 

While many states have coverage parity laws in place, providers have had to fight harder for payment parity. CMS has already announced that certain payment arrangements will be made.Parity changes will not be reversedOnce the COVID crisis is over. Legislation is being considered in several states to safeguard temporary payment parity changes. However, even if they are passed, these laws will only apply state-by–state.

2. What changes do I need to make in order to file claims?

The second insurance-related consideration is that providers bill services using the correct codes, and any modifiers. Most mental health providers are already familiar with the “95” CPT code modifier for telehealth services. 

During COVID, however, CMS reminded providers that claims should include “DR” (disaster-related) and “CR” (catastrophe-related) modifiers as needed to ensure payment.  DR/CR modifiers aren’t generally needed for outpatient mental health services, and they were used more by those whose underlying roles shifted during the pandemic. 

For example, an ambulance company could seek reimbursement for responding to a 911 call and rendering paramedic services, even if they didn’t transport the patient back to the hospital, because COVID requirements didn’t allow them to follow that protocol. When filing their claim with Medicare, the company would add a DR/CR code to identify COVID as the reason they didn’t take the patient to the hospital.

3. Does it matter where I’m licensed?

The provider’s license matters to insurance companies. It is used by insurance companies to determine if the provider can provide services in the state the client received them. They verify this during paneling or credentialing before allowing the provider to join their network. A “place of service” code and office address on a claim form could also reveal that the provider is located out-of-state.

Telehealth Care Licensing

Providers were licensed in the state they provided care. The client’s state of residence was generally irrelevant because clients saw their clinicians at a physical location. 

Telehealth’s rise in popularity was accompanied by a rapid expansion of technology that was much faster than legal developments. The majority of clients continued to see their providers in-person, and coverage parity laws only became the norm shortly before COVID. Providers had to stop providing in-person services due to the pandemic. They were faced with an existential question: who can I treat?

1. If I’m only using telehealth, am I restrained by my state license?

The law, in most states, considers a telehealth visitIt must take place at the client’s location during the encounter. This means that the provider must be licensed in the state where the client is actually located — a requirement that theoretically ensures that the provider is regulated by the client’s state and is aware of that state’s practice requirements, such as:

In reality, a good therapist in Illinois can be an excellent one in California. Technology now allows them to bridge that geographic divide — if only the law followed suit.

For example, say that you’re licensed in New York, live in New York, and have always seen clients at your New York office. Some of your clients relocated permanently to suburbs in New Jersey or Connecticut during COVID. The law prohibits you to treat your clients in New Jersey and Connecticut via telehealth unless New York has a border state exception. Some dense areas, such as the DC-VA/MD metro area, have recognized that it is difficult to regulate certain professionals individually and have implemented waivers or licenses from border states. 

These requirements are a result of the expectation that clients and providers will be able to communicate with each other. DoThey may even live in the same location. Proximity may even be clinically necessary — if a provider determines that a client’s care necessitates an in-person visit, then they could schedule that appointment promptly. This is especially important for therapists who work with youth and those with severe mental illness. 

If providers and clients are in different locations, then an in-person visit would be impractical or impossible — even if the standard of care required it. COVID has thrown some of these norms out of whack. Providers were forced to ask themselves whether a client was “safer” receiving teletherapy from home or risking COVID infection by entering their office. Providers had to think about their own health, as well as how in-person visits could affect their families, staff, or clients. Telehealth quickly became the norm and providers were able to continue treating clients even if they had to move around in the wake of the pandemic. 

2. My profession has an interstate licensure agreement. Does that change anything?

The Psychology Interjurisdictional Comp (PSYPACT), which coordinates the practice and administration of telepsychology across states, gives licensed psychologists more flexibility. Currently Over a third of the U.S. states have PSYPACT legislation that is effectiveThis number will rise to half by 2021.

PSYPACT states that psychologists must be licensed in a compact state. The client must be located in a participating state.  However, authorization is not granted automatically. Psychologists must be licensed to practice telepsychology under the authority from PSYPACT. Request an Authorization to Practice Interjurisdictional Telecommunications (APIT).ASPPB E.Passport. 

The rapid pace of new PSYPACT legislation shows that legislators recognize the value and demand for teletherapy services that cross state lines. However, laws still lag behind technology. The laws that apply to therapists who are interested in setting up an interstate practice should be understood.

Figuring out exactly what is required of you and what path makes sense for your practice isn’t something you have to do alone. Jackson LLP Healthcare Attorneys is a law firm that specializes in providing mental health counsel to help you make the right decisions in your practice.

This article is intended for education purposes only and is not intended as specific legal advice. This article does not create an attorney-client relationship for Jackson LLP Healthcare Attorneys with the reader. It These should not be used to replace competent legal advice from a licensed attorney in the jurisdiction.




© Copyright 2021 GoodTherapy.org. All rights reserved. Permission to publish granted Connor D. Jackson JD

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