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The Legal Landscape of Teledermatology
February 01, 2017

The Legal Landscape of Teledermatology

Oluwatobi (Tobi) Ogbechie's interest in healthcare delivery grew from the fascination with the interplay of the socioeconomic and medical implications of disease. She has co-authored articles in peer-reviewed medical and scientific journals and managed health education programs for the underserved. She completed a joint degree in medicine and business administration in 2015 at Harvard Medical and Business Schools respectively. She will complete a residency in Dermatology and continue to use her academic and management foundations to foster her interest in innovative and entrepreneurial models for healthcare delivery.
In the last decade, clinical researchers and entrepreneurs have focused on teledermatology as a major solution to increase access to dermatology services while improving the patients’ experience.1-3 Historically, teledermatology has been categorized into 2 branches: live-interactive (synchronous) and store-and-forward (asynchronous). The live-interactive modality involves a dermatologist evaluating a remote patient in real time, but is generally less cost-effective.4 Conversely, the store-and-forward modality has the potential to increase cost-effectiveness and improve access by evaluating the patient asynchronously.5,6

Yet, widespread adoption of teledermatology has not been as rapid as expected. For example, only about 9% of community health center primary care physicians and 36% of academic dermatologists had prior use of dermatology in a recent study. Major adoption barriers identified include reimbursement, technology, training, and liability concerns.7-9 Recently, several state legislations have attempted to foster the adoption and appropriate use of teledermatology.

Many states have enacted “parity” laws for telemedicine programs, such as teledermatology, which ensure that clinicians are reimbursed the same amount for telehealth services as in-person services. However, many of these laws also have technology restrictions that limit the type of telehealth service as well as the populations covered, which results in coverage of mostly live-interactive services for underserved rural populations. The US Congress has recently introduced a bill, the Medicare Telehealth Parity Act of 2015, which expands the services and populations covered, but the success of this bill is not guaranteed. 

Medicare: Teledermatology consultations that are reimbursable must use live-interactive, or synchronous, modalities. Patients are geographically limited to Health Professional Shortage Areas that are not in a Metropolitan Statistical Area. This program requires that the patient was seen from selected “originating sites” and that the provider be a physician, nurse practitioner, or physician assistant. Finally, only certain services are eligible for reimbursement.

Nevertheless, these services change each year. If all these prerequisites are met, then a provider can use a “GT” modifier for the clinician reimbursement, in addition to seeking reimbursement for a facility fee.10

Medicaid: Forty-eight states have some form of coverage, but only 4 (Delaware, Iowa, Nevada, and Oklahoma) have parity coverage with few restrictions. Restrictions include the originating site of the telehealth consultation (home vs school vs clinic), technology (cell phone vs desktop-based applications), and modality (synchronous vs asynchronous). As the laws are rapidly changing, the National Telehealth Policy Resource Center has an updated coverage map.

Private insurance: Thirty states have parity laws that require commercial insurers to reimburse providers for live-interactive teledermatology services. Of these, 22 states do not have modality or clinician restrictions for coverage.11 In the other states, larger insurance carriers may reimburse for telehealth services based on the patient’s particular policy. For more information about particular states, the American Telemedicine Association has an updated table.

Out-of-pocket: Clinicians who are providing telehealth services not covered by any insurance can choose to charge a convenience fee that is billed directly to the patient. Various services allow physicians to customize a patient portal for patients who want this convenience. Even further, some services allow physicians to perform teledermatology consultations for patients whom they have never met. Outside of integrated health systems, such as the Veteran’s Administration, direct-to-patient teledermatology is still uncommon in the United States.

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