Medicare Change to “Privileging by Proxy” Could Hurt Psychiatrists Providing Telepsychiatry

September 1, 2010

The Centers for Medicare and Medicaid Services (CMS) wants rural hospitals and critical access hospitals (CAHs) to take certain new steps to ensure that the private-office psychiatrists they connect to in big cities for telemedicine services are qualified for that purpose.

Rural hospitals are concerned that a proposed change in Medicare policy will put a crimp in their use of psychiatrists via telemedicine. The Centers for Medicare and Medicaid Services (CMS) wants rural hospitals and critical access hospitals (CAHs) to take certain new steps to ensure that the private-office psychiatrists they connect to in big cities for telemedicine services are qualified for that purpose.

Deanna Larson, vice president, quality initiatives, Avera Health, said, “To provide psychiatry services to these rural areas, Avera must utilize psychiatrists affiliated with private practices across the US. Unfortunately, CMS’s proposed rule change does not alleviate the credentialing and privileging burden for our rural hospitals in this situation.” Avera Health is a regional health care system with more than 90 clinics, hospitals, long-term–care facilities, and home health agencies in South Dakota, Iowa, Minnesota, and Nebraska.

Avera owns 24 CAHs in those states. CAHs are designated as such by the federal government and must be beyond 50 miles from the nearest other hospital and have fewer than 25 beds, among other qualifications. Larson said the primary care physicians at those CAHs need 3 times as many psychiatrists as they currently have access to in order to provide the behavioral health care services that are in demand. To meet that need, Avera has started to experiment with videotaping an initial behavioral consult between a patient and a psychologist and then paying a telepsychiatrist to view that videotape and make recommendations.

For a decade, psychiatrists have been providing services via telemedicine to seniors and have been reimbursed by Medicare for those services. The Medicare, Medicaid, and SCHIP Benefits Improvement Protection Act of 2000 passed in October 2001 expanded the list of approved Medicare telemedicine services to include consultations, office visits, and office psychiatry visits. Currently approved telemedicine services, for which Medicare reimburses include initial inpatient consultations, follow-up inpatient consultations, office or other outpatient visits, individual psychotherapy, pharmacological management, and psychiatric diagnostic interview examination.

Up until July 15, 2010, rural hospitals had been able to use psychiatrists for telemedicine without credentialing them; they relied on the psychiatrist’s credentialing at his or her home urban hospital. A congressional law passed in 2008 changed that, forcing Medicare to propose new telemedicine credentialing rules. The changes were proposed last May 26. Rural hospitals could continue to use the same psychiatrists for telemedicine they had been using. But the CAHs-and their satellite clinics-would have to ensure 4 conditions are met.

Those conditions are that (1) the big-city hospital that has already credentialed a psychiatrist is Medicare-participating; (2) the physician is privileged at the distant-site hospital; (3) the physician holds a license issued or recognized by the state in which the hospital whose patients are receiving the telemedicine services is located; and (4) the big-city hospital has evidence of an internal review of the physician’s performance and sends the rural hospital this information for use in its periodic appraisal of that physician. That internal review information would have to include all adverse events that may result from telemedicine services provided by the urban physician and also that all complaints the hospital has received about him or her.

Conditions 3 and 4 are causing the most concern. “While we expect that CMS viewed this as a reasonable and more efficient course for privileging, RWHC [Rural Wisconsin Health Cooperative] believes this will have the contrary effect because requiring the exchange of the occurrence of adverse events and complaints relevant to the practitioner, along with signed attestations, will be burdensome and not forthcoming from distant site provider,” said Tim Size, executive director, RWHC.

Rob Sprang, president of The Center for Telehealth and e-Health Law, explained that psychiatrists who are licensed in New York, for example, should not have “to hold a license” in Montana, as the CMS changes seem to require. That is because in 44 states, the licensing statutes allow for consultative services without requiring an in-state license, provided the out-of-state physician is licensed in another state. “These are 2 examples of situations where an out-of-state practitioner could be in compliance with a state’s licensing statutes but not ‘hold a license’ in that state” Sprang explained.