Morgan Lewis’s Telehealth Practice: Prescription for Rapidly Evolving Issues

Tuesday, October 13, 2015

As lawmakers, state professional boards, the US Centers for Medicare and Medicaid Services (CMS) and commercial payors and other industry stakeholders set new parameters for the telehealth industry—which continues to experience rapid growth and innovation—Morgan Lewis lawyers are increasingly called on to advise clients on emerging legal and regulatory challenges and business opportunities. Focused on results, we provide  legal and compliance advice in an expanding variety of matters. We serve clients across the healthcare industry, from telehealth provider networks to tech and life sciences companies, to payors, providers, employers, and investors across the United States and worldwide. We have experience in matters related to telehealth reimbursement, state medical and pharmacy board requirements, federal and state fraud and abuse laws, and matters relating to US Federal Trade Commission and US Food and Drug Administration regulation.

Recognized for our healthcare regulatory, compliance, and enforcement capabilities, we were ranked as the third-largest US healthcare law firm by Modern Healthcare in 2015 and earned recognition as LMG Life Sciences’ Life Cycle Firm of the Year for 2015 and as a finalist for Regulatory Firm of the Year and Government Investigations Firm of the Year. Our broad industry experience enables us to provide integrated legal guidance. We help our clients target their limited resources to areas with the most significant risk.

Partner Reece Hirsch and the team spoke with us about the latest trends affecting telehealth companies and investors.

How would you describe where the digital health industry is today compared to one year ago?

Although there have been setbacks, such as the Texas Medical Board ruling against a large telehealth company, advancements have also occurred in the last year. For example, the Federation of State Medical Boards Interstate Licensure Compact was established and adopted by a growing number of states. Moreover, both the US federal health insurance Medicare program and commercial third-party payors have continued to expand their coverage for telehealth services.

What are some of the most innovative or niche areas the team has been asked to assist with?

It has been a banner year for telehealth innovation and the legal aspects that go along with that are no different. State authorities, such as professional licensing boards, have reviewed and revised their telehealth policies. CMS has expanded the range of telehealth services that may be provided and reimbursed under the Medicare program as well. We have advised several Accountable Care Organizations (ACOs) and health systems on various aspects of telehealth reimbursement, from operating mobile units to performing inpatient telehealth consultations, to the technical requirements for completing CMS-855 and CMS-1500 forms for telehealth providers/services. We’ve also assisted telemetry companies with unique issues that arise when performing remote medical services over a period of several days, including jurisdictional issues and practical compliance concerns. Other matters we’ve worked on over the last year involve the use of asynchronous technology, which is currently only reimbursable in limited instances. The confluence of health, technology, modern applications (like mobile apps), and legal issues is really interesting. It is an exciting time to be involved in telehealth law.

What is the greatest legal or regulatory challenge clients face in the telehealth arena?

The Health Insurance Portability and Accountability Act (HIPAA) always remains a central concern when medical or pharmacy services are performed electronically. But as industry participants start to think more directly about the possible uses of telehealth and issues such as fraud and abuse, compliance, and reimbursement, they are finding an absence of helpful guidance from regulatory authorities. In some cases, we have had to resolve conflicting guidance between federal agencies and state lawmakers. So the lack of affirmative guidance, as well as the evolving regulatory scheme of telehealth at both the state and federal level, will likely challenge stakeholders to ensure compliance. For instance, one of the biggest challenges facing physicians is ensuring that they establish the “physician-patient” relationship before providing telemedicine services, as is required in several states. However, state boards (with input from the Federation of State Medical Boards) are reconsidering the need for restrictive protections and barriers to access while preserving safeguards to protect patients. Physicians and other providers need to stay on top of these developments to ensure the telehealth services they provide meet applicable legal requirements.

Where do you see the biggest opportunities for clients in the next 12 months?

The 21st Century Cures Act offers a glimpse of the direction telehealth is moving and industry stakeholders would be well-advised to monitor emerging trends. We have a pretty diverse client base, from hospitals and doctors to big data companies to device manufacturers; each of these areas presents different opportunities. Nevertheless, the demand for telehealth services is already established and growing by the day. Now it is just a matter of ensuring that the legal authorities and third-party payors catch up with that demand in a way that balances the need for protecting patients receiving medical services with promoting greater access, convenience, innovation, and efficiencies. Telehealth service providers, for instance, are beginning to leverage down telehealth practice to nurse practitioners and other mid-level practitioners, or keeping a stable of physicians in a central location to perform services remotely. Combined with an increasing need for primary care services (and corresponding shortage), expect to see additional programs that incentivize such care performed remotely.