On March 13, 2015, Governor Andrew Cuomo signed into law an amendment to the telehealth delivery legislation (Chapter 550) (A-9129) made effective January 1, 2015. The law was drafted and proposed by the NYS Department of Health and made significant amendments (reference: http://www.bsk.com/media-center/3068-health-law-wire-new-telehealth-legislation-proposed-new-york-2016-2-15).

The amendment extends the effective date to January 1, 2016 and adjusts the application to policies issued or renewed on or after January 1, 2016. Meanwhile the commissioner of health is authorized to issue, amend or repeal any regulations as necessary to implement the telehealth delivery legislation.

As noted in our prior article, there are several issues that still need to be addressed and/or clarified by the NYS Department of Health and Department of Financial Services:

1. With regard to the commercial health plans, the legislation limits the coverage requirement by stating that "an insurer may exclude from coverage a service by a health care provider where the provider is not otherwise covered under the policy." Therefore, only those individuals that can afford additional out-of-network benefits would be covered for the delivery of health care services by means of telehealth. In application, this may be a critical limitation on the adoption of telehealth because in most, if not all, instances (other than remote monitoring) the telehealth provider would be located in another region of the state or country and not likely a participating provider in the plan’s network. This is a relevant topic directly related to the purpose of and concept behind teleheath.
2. The definition of the term "telehealth" is "the use of electronic information and communication technologies by health care provider to deliver health care services to an enrollee while such enrollee is located at a site that is different from the site where the health care provider is located." Thus, the term is broader under the Insurance Law than in application to the Medicaid program. Furthermore, there is no limiting definition on the originating or distant site location. For example, the delivery of health care services by means of audio-only telephone alone, if an appropriate medical practice, would have to be covered by the plans. On its face, the definition leaves open the debate, and inevitably the coverage disputes, regarding what covered services can be delivered by means of telehealth under applicable medical practice standards and policy terms.
3. The Medicaid program must take into consideration that while telehealth is anticipated to reduce costs of hospital admissions and readmissions, the providers will need financial incentives to invest capital outlay funds to purchase the software technology and equipment to support the provision of telehealth. This may require the Medicaid program to have higher reimbursement rates for telehealth services for a period of years to offset such expenditures. However, this would likely require the State to obtain an amendment to the State Plan if the reimbursement amount for delivery of health care services by means of telehealth is in excess of the current amount reimbursed for covered services delivered by way of direct care.