by Kristen Cayze, MSA Analyst

Telemedicine involves the remote diagnosis and treatment of patients by means of telecommunications technology. While telemedicine services gained popularity during the COVID-19 pandemic, these services have been available for years.

Given the limitations of telemedicine, there are certainly times when patients need in-person evaluation and treatment. For example, diagnostic testing, injection therapy, laboratory work, and wound care are a few instances where in-person treatment would be required. For a variety of health care needs however, telemedicine can be a viable, and sometimes preferred, method of treatment.

When Telemedicine is the Preferred Option
In cases where an injured worker has transportation issues, telemedicine would save the insurer from paying for transportation services for doctor’s visits and follow-up appointments. An injured worker who is recovering from surgery and has a difficult time getting to an in-person doctor’s appointment may also prefer telemedicine for routine follow-up care. In a variety of circumstances, telemedicine is a win-win for both the injured worker and the insurer.

Initial Reluctance to Adopt
Initially, a major hurdle to the widespread adoption of telemedicine was injured workers’ reluctance to give it a try. For some, that reluctance was driven by concerns around navigating the technology required to receive treatment remotely. For others, it was driven by doubt that treatment could be as effective when not provided physically in a health care provider’s office.

Pandemic Drives More Widespread Use
The COVID-19 pandemic led to limited in-person options for a period time, which facilitated a transition to the use of telemedicine services in order to provide patients with the care they needed. As injured workers still required treatment, patients who may have otherwise been unwilling to try telemedicine services began using them regularly. For example, in the year prior to the pandemic, 300 of the Mayo Clinic’s providers had performed at least one video telemedicine visit. By the middle of July 2020, that number increased 2,000% to more than 6,500 visits.[1]  Many first-time patients were pleasantly surprised by how easy and effective telemedicine could be.

Telemedicine Visits Reflected in MSAs
In March 2020, the Centers for Medicare & Medicaid Services (CMS) issued an 1135 waiver, which allowed telemedicine services to be covered and paid for under Medicare with broadened access and for a wider range of services. Prior to the waiver, Medicare had placed strict limitations on the coverage of telehealth services. Within the past year, MEDVAL has seen exponential growth in the number of telemedicine records received for review when preparing Medicare Set Aside (MSA) reports. While these services are often billed under different procedure codes, there has been no cost differential to date. Thus, the total MSA pricing allocations have not changed.

Post-settlement, our Professional Administration team has noted that telemedicine visits have not affected MSA costs, as the visits continue to be paid as in-person services. As noted above, CMS has expanded what is covered under telemedicine. Our team has  also found that claimants prefer telemedicine visits when given the option and have indicated that they will continue to take advantage of telemedicine options when possible.

Will the Trend Continue?
While there is no definitive answer to the question about whether telemedicine will be around indefinitely, it certainly appears that the trend is moving towards increased telemedicine utilization. As discussed in the New York Times article, Is Telemedicine Here to Stay, it seems that the future of telemedicine largely depends on how private health insurers and Medicare handle coverage for virtual medical services once the coronavirus pandemic is behind us. Due to the urgent need for telemedicine services stemming from the coronavirus pandemic, private health insurers and Medicare have agreed to temporarily pay the same fee for these services as in-person services. However, if their stance changes and these services are only allowed at a reduced fee, I think we will see providers limit their virtual offerings to special cases where telemedicine may be a necessity.

What This Means to You
In the majority of Medicare Set-Asides (MSAs) I have completed recently, there was a brief period of virtual medical services in the spring and summer of 2020 with a return to in-person medical treatment in the Fall of 2020 and thereafter. However, I believe there will still be times when it will benefit workers’ compensation insurers to have the capability to utilize telemedicine services. For example, if there is an injured worker who lives in rural Washington and the insurer wants them to be evaluated by a specialist in California for a second opinion, telemedicine would offer significant financial savings for the insurer. Just a few years ago, if this situation presented itself, the insurer would have paid for airfare, an overnight hotel stay, and provided meal reimbursement for the required travel from Washington to California. While they may not be utilized as heavily as they have been in the past year, it is likely that telemedicine services will continue to some degree for the foreseeable future. So, it will be interesting to see what Medicare and private health insurance companies decide regarding payment for virtual medical services. If telemedicine visits end up getting paid at a reduced rate, they could offer cost savings for insurers, which may also impact MSA allocations due to the need to allocate separately for telemedicine services at a different rate than in-person services. There will undoubtedly be pushback from medical providers if virtual medical services are paid at a reduced rate, so we will be watching closely to see how the situation develops and any impact on MSA allocations.

As the situation evolves, we will continue to share insights regarding the ongoing impact of telemedicine utilization and fee allowances on workers’ compensation claims and future MSA allocations.

[1] Marin, Alison. Telemedicine takes center stage in the era of COVID-19. Science [Magazine], November 6, 2020.