Recently finalized Medicare Advantage (MA) policy changes will likely bring more telehealth services to senior living communities.
Under the new policies, finalized on April 5 by the Centers for Medicare & Medicaid Services (CMS), Medicare Advantage plans will be allowed to cover telehealth services that originate from beneficiaries’ homes — such as an independent living or assisted living community — rather than a health care facility.
“That’s a big win in a lot of ways,” Amy Kaszak, president of Special Needs Plans at AllyAlign Health, told Senior Housing News. AllyAlign specializes in helping senior living and care providers design, launch and run their own MA plans, and works with clients such as Marquis Companies and The Perennial Consortium.
In another policy shift, MA plans will be able to offer telehealth services as a core benefit rather than a supplemental benefit, which will give them more options for how to underwrite this coverage and should expand availability. These changes will take effect starting in plan year 2020.
Senior living providers and MA payers still have many logistical and financial considerations to work out in light of these new flexibilities, which come as an increasing number of senior living providers are establishing their own MA plans or devising strategies to work with existing Medicare Advantage insurers.
Big potential, slow adoption
Telehealth technologies — such as virtual doctor visits done over a laptop or tablet — have long been touted as a way to reduce overall U.S. health care spending by making it easier for people to receive proactive, preventive medical attention, reducing hospitalizations and other high-cost interventions.
However, within the framework of traditional fee-for-service Medicare, CMS has expanded the scope of telehealth benefits slowly.
At first, only seniors living in rural areas were eligible to have telehealth benefits, and they had to go to a health care setting, such as a skilled nursing facility, for the telehealth visit.
Starting this year, traditional Medicare is covering telehealth visits for people living in non-rural areas.
Meanwhile, Medicare Advantage plans — which are offered by private sector insurance companies that receive capitated payments from the federal government — have had the ability to offer telehealth coverage via supplemental benefits. Starting in 2020, they will be able to pay for these services directly via the federal dollars they receive.
In part because of the limited reimbursement but also owing to other factors, telehealth utilization has remained relatively low among older adults, according to Alissa Meade, president and CEO of Curavi Health. Curavi offers telemedicine solutions specifically tailored for post-acute and senior living settings.
Out of the telehealth visits Curavi has performed across all settings, about 95% result in a senior being treated in place, and about 40% of them directly prevent a transfer to a different care setting, Meade said.
Now, on the strength of numbers like these, as well as the new Medicare Advantage payment options and a senior population that is becoming more tech-savvy, the telehealth tide might be turning.
A senior living opportunity
Payers are focused on getting further downstream to provide more cost-effective care to people living in single-family homes as well as senior living communities, Meade said. This is driving increased demand for telehealth in these settings.
“Absolutely, there’s an increasing demand for telemedicine in assisted living and people’s homes,” Meade said.
There is “no question” that the recent changes will lead to more Medicare Advantage plans offering telehealth benefits in 2020 and future years, Meade added, and senior living providers are “extraordinarily well positioned” to work with MA payers to deliver and ensure the success of these benefits. That’s because senior living providers have influence over their resident populations to help ensure high utilization and effective delivery of telehealth technology, whereas these challenges are harder to solve for older adults living in single-family homes scattered across a potentially large geographic area.
Curavi is already in dialogue with MA plans that have high penetration among their senior living and care clients, discussing potential use cases for 2020 and beyond, Meade said.
Kaszak echoed these sentiments, and said that AllyAlign is also working with its senior living clients to determine how to incorporate the new benefits into their Medicare Advantage packages.
Some senior living providers that offer or are devising their own plans have a primary care infrastructure in place, and Kaszak believes it is likely that the telehealth benefits will be structured as an extension of these services.
Overall, new telehealth benefits should further accelerate the integration of senior living and Medicare Advantage, which has been gaining steam for several years, and in particular since last April. That’s when CMS finalized a move allowing plans to cover non-skilled in-home services as supplemental benefits, opening up the possibility of direct reimbursement to senior living providers that otherwise are private pay.
It remains to be seen how the new telehealth Medicare Advantage benefits might impact senior living providers financially. Conceivably, senior living residents in a single building might belong to a variety of MA plans that all offer slightly different telehealth benefits, creating logistical complications in terms of how the senior living provider should make the telehealth technology available, how to help residents determine what benefits they have and how to tap into them, and what the financial upside might be for the provider.
The issue might be somewhat clearer for senior living providers that have an affiliated MA plan, as this likely would be the most common plan that its residents join, Kaszak noted.
However, Medicare Advantage insurers cannot include the cost of equipment and other capital investments into the cost of their bids, she added, so providers still face expenses if they are trying to build up their telehealth capabilities. And once the technology is in place, the senior living provider may need to hire or assign a dedicated staff person to be in charge of assisting residents with their telehealth visits.
A senior living provider could contract with — and pay — a third-party company such as Curavi to handle telehealth services. Curavi and its senior living clients should see financial upsides if more residents can rely on their MA plans to cover telehealth, Meade said, although she is not sure yet how specifically the arrangements will be structured in the future.
As for the pace at which MA insurers might start adding these new benefits, that too is an open question. Likely, they will start with basic coverages, such as telehealth to replace assessments and usual physician visits, Kaszak predicted. Down the road, there’s a lot of room for creativity — for instance, in bringing telehealth to memory care.
“Here in Texas, one of the first widespread uses of telehealth that I saw was for behavioral health counseling/psychological services in group settings, originally to prison inmates — it was very successful,” Kaszak said. “I’m not making any correlation between prison inmates and memory care, but it’s a good example of how you can deliver those scarce resources, from a provider perspective, to a group setting and make that work.”
On the whole, senior living providers should be thinking about what their telehealth strategy is in light of this recent Medicare Advantage news, which Kaszak believes is a step in the right direction.
“I think it’s something that’s long overdue for the provider community,” she said.