1 Min Read

Guest Blog: The Importance of Negotiating your Payer Contracts for Reimbursement and Telemedicine Coverage

Nathaniel Arana

Written by Nathaniel Arana


Higher utilization of telemedicine  results in better clinical outcomes for patients.

When payers restrict payments on telemedicine, the unintended consequences are stifled innovation and less collaboration between providers. Covering telemedicine between patients, and between providers, can help the current system help the underserved. If specialists can be provided payment, they would be more willing to provide consults to patients in rural areas. This would likely decrease costly medical transportation and admission to emergency rooms in larger cities from underserved areas.

A recent study conducted by the California-based Center of Connected Health Policy (CCHP) found that half of payers aren’t publishing information on their websites about telemedicine coverage.

Many states have enacted parity laws that require health plans to pay for telemedicine services at the same rate as face-to-face visits. Almost 40 states have some sort of parity law in place.

Allowing telemedicine to flourish will actually reduce healthcare expenditures. Here are a few examples of how telemedicine actually reduces healthcare costs:

    • It reduces the time it takes for patients to get diagnosed; preventing complications while waiting for an appointment
    • It allows collaboration between physicians to accurately diagnose patients. Misdiagnosis is one of the leading cost drivers of healthcare
    • It allows providers to triage patients so that they can present to the most appropriate healthcare venue. Many patients can be directed to an urgent care, for example, instead of an emergency department

These are just a few examples of the importance of telemedicine, how it can reduce costs and increase clinical outcomes.

What can be done?

Until payers in every state are forced to provide telemedicine with parity of reimbursement in every state (not likely) providers need to negotiate their contracts so that telemedicine is covered and reimbursed appropriately.

The idea behind the negotiation should be that you are saving the health plan money by providing telemedicine services while increasing clinical outcomes. As a result, telemedicine should be covered, and your regular fee-for-service rates should be increased as well.

Click here to learn more about NGA Healthcare 

Published: May 20, 2019