In response to the COVID-19 pandemic, state and federal governments have issued a variety of telehealth waivers, which loosen regulatory restrictions on receiving and providing healthcare virtually. Though these changes have led to a surge in the use of telehealth throughout the country, many of these telehealth waivers are temporary and only remain in effect for the duration of the COVID-19 Public Health Emergency.

In response to the impending expiration of the loosened restrictions, some federal and state legislators have introduced or passed laws that would make the expanded access to telehealth care permanent, while other states have allowed the temporary waivers to expire. Below, we review federal and state legislation affecting access to telehealth.

Special COVID-19 Changes to Telehealth Laws

Expansion of Telehealth Coverage by Medicare: Under the CARES Act, Congress expanded Section 1135 of the Social Security Act (referred to as “Section 1135 waivers”), which provided the Department of Health and Human Services (HHS) the ability to waive or modify certain federal requirements related to telehealth benefits under the Medicare program for the duration of the COVID-19 Public Health Emergency (PHE). Generally, Medicare can only pay for telehealth on a limited basis and only where the person receiving the services is in a designated rural area and when they travel to an eligible “originating site” (i.e., leave their home to go to a qualified medical facility for the service).

Pursuant the CARES Act waiver expansion, the Centers for Medicare and Medicaid Services (CMS), among other things, permitted beneficiaries to receive telehealth services from locations other than the “originating site,” such as their homes, and without the required telecommunications equipment for evaluation. Further, Medicare reimbursed providers at the same rate as in-office visits for a variety of care, not just for care related to the diagnosis and treatment of COVID-19. This temporary provision went into effect on March 6, 2020 and is currently set to expire at the end of the COVID-19 PHE.

Telehealth Coverage for Individuals with High Deductible Health Plans (HDHPs): The CARES Act also permitted HDHPs with plan years beginning on or after December 31, 2021 to provide telehealth services without a deductible, or with a deductible lower than the minimum deductible otherwise required by law. This provision allowed individuals covered under HDHPs to receive free or low deductible telehealth services without jeopardizing their eligibility for Health Savings Accounts (HSAs).

The federal loosening of telehealth regulations has resulted in a surge of telehealth use across the country. However, absent any further legislation by Congress, the expanded telehealth provisions are also set to expire at the end of the COVID-19 PHE.

Federal Legislation on Telehealth

There have been a multitude of bills introduced in Congress aimed at expanding access to telehealth, with almost 40 different bills introduced in 2021 alone. Some of the bills aim to make the temporary COVID-19 telehealth changes permanent, while other bills seek to impose new requirements on employer group health plans. The proposed bills primarily focus on the following proposals:

Though it is difficult to predict whether any of these bills will be signed into law, it does appear that telehealth expansion garners bi-partisan support and that federal changes will be forthcoming.

State Legislation on Telehealth

States have also moved to pass laws that encourage the use of telehealth. In late 2019, California passed a telehealth parity bill, which requires carriers to reimburse providers for telehealth services at the same rate as identical in-person services beginning January 1, 2021. For more on the California telehealth law, see our blog.

More recently, in June 2021, Oregon passed House Bill 2508A, which requires the Oregon Health Authority to reimburse health services provided through telehealth at the same rate as if the care was delivered in person, as long as certain requirements are met.

In July 2021, Illinois passed House Bill 3308, which goes one step further and requires individual and group health plans to cover clinically appropriate and medically necessary telehealth services in the same manner as any other benefits covered under the policy and limits cost-sharing for telehealth services to no more than what would be required for in-person services.

While some states have moved to make temporary COVID-19 telehealth waivers permanent, other states such as New York and Florida have allowed similar temporary COVID-19 telehealth relief to expire. Nonetheless, it appears that states are continuing to pass legislation that expands access to telehealth.

What’s Next

As a result of the COVID-19 pandemic, more individuals are willing to receive medical services via telehealth than ever before. Federal and state legislatures have indicated the willingness to require government and employer-sponsored healthcare programs to cover telehealth care “in parity” with in-person care and it is likely that more states will introduce similar legislation.

Additional Resources

Emerald Law – Emerald is a Client Compliance Consultant for Sequoia, where she works with our clients to optimize and streamline benefits compliance. In her free time, Emerald enjoys stand-up comedy, live music and writing non-fiction.