February 1, 2023

December 2022 - Facilities Fees and Telehealth: Past, Present, and Future (Ethan Booker, MD, FACEP)

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- All right, well, good afternoon, everybody or good morning or good evening depending on what part of the world or country you are coming in from. I'm really excited to see people here. I'm assuming that more people will be streaming in cause I knew this was a topic that a lot of people were really excited to see on the docket. Well, I'm Emily Hayden for those who don't know. I think I've met many of you or all of you chair for this committee or for this section. And we are lucky to have Dr. Ethan Booker today coming to talk about a topic that we all know about but may not know much of what it really is and what behind the scenes and what we should know with our telehealth hats and how we should be ready to either advocate or help build the knowledge for any types of changes in facilities fees for telehealth. So Dr. Booker, he's coming from MedStar. He's the chief medical officer for telehealth and the medical director of the Telehealth Innovation Center there. He's a past president of the DC chapter of ACEP, past ACEP representative to the AMA, especially for the RVUs and the Specialty Society Relative Value Scale. So really key for emergency medicine, especially in the AMA, for us to have that representation. And then a current member of the ACEP Reimbursement Committee. And so I had mentioned to a couple other people, Ethan, that you and I talked just quickly by phone. I just had a couple of questions and you just had such a great presentation of walking me through facilities fees and sort of past, present, and future so really looking forward to you presenting to the rest of the group cause I learned quite a bit and I have so much still to learn. So I'm gonna hand it off to you, if you wanna share your screen. And I think also we had also thought that if people have questions throughout, he's gonna stop a couple of times throughout the presentation cause I'm sure there's gonna be questions or clarifications. So rather than having to wait until the end, know that we'll have a couple of gaps in the presentation. Also note, if you didn't see already, that this is being recorded too so we'll be posting this on our website. All right, Dr. Booker, it's yours.
- Thank you, Emily. Can you see this screen here to get started?
- [Emily] Yep, yep.
- We'll dive in. So thanks very much for having me. As Emily mentioned, I'm now one of the lucky people who gets to spend most of my time actually thinking about telehealth. And my set of responsibilities for telehealth are system wide and not really focused that much in emergency medicine anymore, which is kind of good and bad. It's good to have a broad purview. It's much more challenging to work with people who are not emergency doctors to create change across an organization. But as Emily mentioned, I'm still on the Reimbursement Committee, but I spent almost eight years as emergency medicines representative to the RBRVS update committee of the AMA. Of those of you who are familiar with the RUC, you know, it's where the sausage gets made for passing recommendations to CMS for updates to the physician fee schedule. So I developed a fair amount of expertise about the real granularities that exist in professional services, but facility fees remains a bit of a black box for absolutely everybody, including me. And I think we, on the physician side, on the professional side, have developed a lot of expertise and understanding the granularities of how work turns into a CPT code turns into a bill turns into payment for us. But there's still some confusion about what, you know, the relationship of facility codes. And I think that's confusing enough for in-person delivery. When you add in the complexity of telehealth, it adds just another layer of complexity because it's not something that's actually particularly well defined of yet. So I'm gonna lay out a thesis for you about some of the arguments that are existing around parody and why there continues to be regulatory hesitancy. And hopefully, we can have a bit of discussion about what this means for us thinking about moving forward. So one of the things that I think is true, and this is the sort of crux of the conversation that Emily and I had was that there's essentially just disagreement about what's meant by parody because we providers mean one thing about what's the cost or payment for care, but payers mean a different thing when they think about it because they're thinking about really a different bucket. I propose that the RBRVS methodology of payment that exists in fee for service activities is not great for a whole host of reasons, including that it doesn't capture value particularly well. But it does, in fact, have a foundational methodology to arrive at a granular perspective on payment for a particular episode of care and that we should lean into that methodology. Lastly, I'm gonna spend some time talking about telehealth delivery generally, including the ambulatory office codes and then a little bit of time about how ED E&M codes are especially special and we should think cautiously about how we use those codes when we're doing work in telehealth. So a very brief history of telehealth reimbursement. Most of you will know this quite well. There used to be some rules. They were developed a really long time ago. There's some rules that are true right now in the public health emergency and there are some rules for sort of now and going forward. There's a lot of variability state by state related to commercial and Medicaid payers. There's a lot of uncertainty around the sort of details of Medicare. I think most of us are fully aware that there's bicameral and bipartisan support for making sure that Medicare beneficiaries have access to telehealth services. I'm quite optimistic that this will all get sorted out. The specifics are less clear. But I think the point that there's been 40 years of development and technology between when these rules were written and the current state is part of the reason why we have a large part of the issues that we have. A little bit about my experience, which looks a lot like your experience, I'm sure, in your health systems, which was we used to just see people in person and then COVID happened and then we stopped doing that where we had, you know, an enormous surge in telehealth activities that's now standardized to, you know, a steady state. This is probably similar to your own system where about 80% of our behavioral health is now done via telehealth and depending upon which office, you're talking about 12 to 15% of primary care done via telehealth. And then a big footprint of other things including, you know, on-demand urgent care and telehealth utilization in our emergency departments. But it's the new normal. I don't think anybody on this call would disagree with the idea that we had great big surge, we learned a whole bunch, and we've now come to a relatively steady state. So hypothesis number one. Telehealth's a new tool for care in an economic substitute. I think as we talk about telehealth reimbursement, this is an important foundational understanding that we need to convey to policymakers. One of the things that policymakers and payers are quite concerned about is that telehealth is essentially an additive cost, meaning, yeah, it's fine. There's telehealth, but we're just gonna end up paying for that visit plus another visit anyway because you're gonna send them to some in-person care. It's just duplicative or additive. So this is data from a research study that I was a PI for, it's cumulative data of about a million patients in primary care across our hospital system, Stanford, and Intermountain. And it constitutes about 4.3 million ambulatory visits over three years, including, pre-pandemic, the year 2020, and the year 2021 where utilization begins to stabilize. And we looked at all patients who had visits in those three years and then what's called matched patients, patients who had visits in all three of those calendar years broken apart by payer type and demonstrated that actually the availability of telehealth does not drive increased utilization in primary care. So we took this data to CBO, Congressional Budget Office, because they had priced telehealth way too high as a new service for Medicare. And so I think it's, again, foundational to describe that this is an economic substitute, not added cost. Particularly, we actually went back and looked at kind of who are these people. So this is visit level data and we know who these people are. Essentially, the orange bars that you can see there is telehealth utilization and the grouping in each year is by number of visits to primary care. So what this demonstrates is that if you're a patient who goes and sees your primary care doctor four times per year cause you have complex medical problems, a couple of those visits are gonna be via telehealth. If you only go once a year, it's mostly gonna be in person. So what we were trying to demonstrate here is patient behavior about why this is a substitute of effect and not new services. Again, the total rate of utilization is flat. People change their behavior about particular types of service that they get care for. So it's important to kind of set this baseline. I think that this is a substitute of economic circumstance because we need to argue from a baseline of saying this is not gonna significantly add total cost. The impact of cost is complex, right? But we should start from a baseline that this is not an additive service that needs to be significantly discounted, but it's replacing care patients would've gotten some other way and so it needs to be valued in a pretty similar way. A long way around to get really the heart of the matter, which is the kind of second and third hypotheses here. The total cost versus the component cost, which is sort of getting into this, the questions of facility and practice expense. I propose that what we should be striving for is a modality agnostic work RVU model and a modality specific place of service model. Meaning if I spend a certain amount of time on a certain level of complexity and acuity, take a certain amount of risk and document it, it doesn't matter how I saw you. That's the work of doing the service. But it probably does matter what modality I use to do that. And it also matters quite a lot about some other features including geography. So I think many of you will be familiar with this methodology around reimbursement. This is the professional fee services, which are the combination of work RVUs, practice expense RVUs, and malpractice RVUS times a conversion factor, which gets updated and published every year in the Medicare Physician Fee Schedule. Practice expense obviously divided into direct, which is, like, the nurses, the clerks, the supplies, the equipment, and then indirect, which is overhead, rent, non-clinical labor, and infrastructure like information technology. So there's already a component of infrastructure technology in the way that there's a methodology for thinking about payment. But this is really the crux of the argument that I made in the conversation that Emily and I had about parody, which is what you and I as doctors see as the work and the cost that we're arguing about parody for is not what payers see as the work and the cost cause what a payer pays is the whole thing. So they see all of that practice expense as the total cost of what they're paying. So we're really arguing about different things and I think none of us would suggest that telehealth includes the cost of band-aids or gauze squares or the exam bed in an exam room. But it does include a lot of the indirect practice expense costs that we have to kind of think about. There's a relationship between those practice expense costs and place of service. Most of us who've always done emergency medicine are only familiar with one place of service, which is the emergency room hospital, which is the description in the form 1500 that you submit to Medicare when you get paid for things. So services delivered in an emergency department or ED E&M services with place of service 23. We'll come back to this a little bit, but Medicare is actually designated a new place of service as of this year and will be available for billing as of April of this year. And some private payers are beginning to use telehealth provided in patient's home as a place of service to designate something that's distinct from place of service 11, the office, which is where much care happens. And they also refined the previously defined place of service 02, which was telehealth, to describe it as telehealth provided other than in the patient's home, essentially hospital-based telehealth, SNF-based telehealth, sort of, cau...

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