Legislation Changes ‘Telehealth’ Application 

New legislation makes telehealth more accessible and profitable for healthcare businesses

by Marki Stewart

Governor Ducey recently signed House Bill 2454, a sweeping telehealth bill intended to expand access to telehealth in Arizona. The bill makes significant strides toward making telehealth more available, convenient and affordable for Arizona patients, but also benefits businesses, including the requirement that insurers pay for telehealth services at the same rate as in-person services. 

Patients and providers alike benefit from the bill’s change in terminology, replacing “telemedicine” with “telehealth.” Telemedicine was previously defined to include only interactive audio, video or data communications, but telehealth includes asynchronous store-and-forward technologies, remote patient monitoring and the use of an audio-only telephone if an audio-visual telehealth encounter is not reasonably available. However, telehealth does not include the use of a fax machine, instant message, voicemail or email.

Providers and related businesses also benefit in four other ways:

Broader scope includes more types of health care providers. The bill also amends the definition of “health care providers” to include additional types of professionals who can practice telehealth, including chiropractors, dispensing opticians, optometrists, physical therapists, occupational therapists, respiratory care givers, acupuncturists, athletic trainers, massage therapists, nursing care institution administrators and assisted living facility managers, midwives, hearing aid dispensers, audiologists, and speech language pathologists, as well as healthcare institutions licensed by Arizona Department of Health Services. 

Removal of out-of-state licensing requirements provides flexibility in hiring. All Arizona healthcare provider regulatory boards are now required to adopt a new registration for out-of-state providers who wish to provide telehealth services to Arizona patients. This means that a telehealth provider licensed in another state need not obtain full licensure in Arizona prior to treating Arizona patients via telehealth; rather, they need only complete a simple registration with the appropriate regulatory board. Arizona-based practices can therefore hire a physician from out of state to provide telehealth services to Arizona patients without the need to meet burdensome licensure requirements.

Reviewing and complying with guidelines avoids severe consequences. Significantly, the bill establishes a telehealth advisory committee on telehealth best practices, consisting of representatives from a variety of healthcare professions and agencies appointed by the Governor. The committee is charged with reviewing national standards and peer review literature for telehealth best practices and conducting public meetings regarding the efficacy of various telehealth services. The committee is required to adopt telehealth best practice guidelines by June 30, 2022. Healthcare providers must then abide by those guidelines and recommendations when providing care to Arizona patients. Consequences for failure to comply could range from not receiving reimbursement for those services to becoming the subject of a licensing board disciplinary action, not to mention the risk of a malpractice claim. 

Reimbursement matches in-person services. Finally, the bill includes comprehensive terms regarding reimbursement for telehealth services provided in Arizona. Insurers may apply only the same limits or exclusions on a healthcare service provided through telehealth that are applicable to an in-person encounter for the same healthcare service, except for procedures or services that are not appropriate to be provided through telehealth. Insurers must reimburse providers at the same level of payment for equivalent in-person services provided through telehealth using an audio-visual format and must reimburse providers at the same level of payment for equivalent in-person behavioral health and substance use disorder services if provided through an audio-only format. Insurers must also cover services provided through an audio-only telephone encounter if that service is covered by Medicare or AHCCCS when provided through audio-only telephone; however, beginning in 2022, insurers must cover audio-only services if the telehealth advisory committee recommends that the service may appropriately be provided through an audio-only encounter. Telehealth providers should become familiar with these payment rules to maximize reimbursement for telehealth encounters. 

In addition to making telehealth more accessible in Arizona — particularly important considering the significant increase in telehealth encounters during the COVID-19 pandemic — the new bill creates a variety of opportunities for healthcare providers. Those familiar with the bill will be positioned to flourish as telehealth continues to grow.  

Marki StewartA partner at Coppersmith Brockelman in Phoenix, Marki Stewart assists hospitals, physician groups, telemedicine providers, laboratories and other healthcare organizations in a variety of business and regulatory issues. She has a special focus and interest in telemedicine, including licensing, reimbursement, credentialing and security issues.

Did You Know: In a national study of a commercially insured population, growth in telemedicine use offset roughly two-thirds of the decline in in-person healthcare visit volume during the COVID-19 pandemic. From the weeks of January 1 to June 10, 2020, the rates for telemedicine visits increased from 0.8 to 17.8 visits per 1000 enrollees, a 2013% change.

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