Effective June 11, 2018, all Department of Veterans Affairs (“VA”) health care providers will be able to offer the same level of care to all beneficiaries regardless of the beneficiary’s or the health care provider’s location. In its recently released final rule, the VA stated that in December 2016 Congress mandated that the agency provide veterans with a self-scheduling, online appointment system, and that the agency meet the demands for the provision of health care services to veterans, regardless of whether such care was provided in-person or using telehealth technologies. As a general rule, most telehealth practitioners are required to comply with various and state-specific licensing, registration, and certification requirements in order to render health care services via telehealth. Failure to do so can potentially jeopardize a practitioner’s professional credentials and could expose them to penalties including fines and imprisonment for the unauthorized practice of medicine or other health care services. These state-specific requirements create certain challenges for telehealth practitioners seeking to practice across state lines.

Therefore, in order to address the mandate issued by Congress, the VA developed and published the final rule to supersede these state-to-state regulations by clarifying that VA health care providers may exercise their authority to provide health care services via telehealth, notwithstanding any state laws regarding licensure, registration, or certification requirements that might be conflicting with taking these actions. Essentially, the VA is exercising its authority as a federal agency to preempt conflicting state laws relating to the practice of medicine or other health care services via telehealth. These efforts by the VA are designed to better protect its health care providers from potential enforcement actions by individual states and/or their respective professional boards, provided that these practitioners are providing telehealth services within the scope of their VA employment.

It must be noted that the final rule’s scope is narrow and only applies to health care providers who are employed by the VA. The final rule does not cover contractors, including health care providers who are participating in the Choice Program. The final rule also does not expand the scope of practice for VA health care providers beyond what is required or authorized by federal laws and regulations or the laws and regulations relating to the practice of medicine or other health care services that are dictated by the state(s) in which the health care provider is licensed to practice. Additionally, the final rule does not affect the VA’s existing requirement that all VA health care providers must adhere to all applicable laws and regulations regarding prescribing and administering of controlled substances, which not only obligates a provider to comply with such laws in the state(s) where he/she is licensed to practice, but also with the federal Controlled Substances Act.

Among the public comments submitted in response to the VA’s proposed rule, published October 2, 2017, the Federal Trade Commission, an agency that has been a big proponent of efforts to expand access to telehealth services, applauded the amendments to the VA’s regulations, stating that it will “provide an important example to non-VA health care providers, state legislatures, employers, patients, and others of telehealth’s potential benefits and may spur innovation among other health care providers and, thereby, promote competition and improve access to care.”

Telehealth providers and stakeholders should closely follow the VA’s progress as the agency works to implement the final rule. Any resulting successes, as well as any failures, may meaningfully impact the continued expansion and adoption of telehealth technologies and services among the private and commercial sectors, as well as potentially influence continued state legislative efforts in this developing area.

Who knew?!  Buried among more than 1,000 pages of a new final rule with comment period on payments to physicians, released on October 31, 2014, the Centers for Medicare & Medicaid Services (“CMS”) finally has given telehealth providers a glimpse of its plans to expand reimbursement for telehealth services provided to Medicare beneficiaries. 

The final rule includes a provision that would cover remote chronic care management using a new current procedural terminology (“CPT”) code, 99490 (with a monthly unadjusted, non-facility fee of $42.60).  This new CPT code can be bundled with the existing CPT code 99091 for collecting and reviewing patient data, which does not require the beneficiary to be present and pays an average monthly fee of $56.92 to the physician.  The final rule also includes a provision that would cover remote-patient monitoring of chronic conditions using existing CPT code 99091 (with a monthly unadjusted, non-facility fee of $56.92).  This provision will significantly broaden Medicare payments for remote patient monitoring of chronic conditions—while CPT code 99091 has been available for coverage of patient monitoring for many years, CMS traditionally has required (and will continue to require), that 99091 be billed in conjunction with evaluation and management (“E&M”) services (CPT codes 99201-99499), the most common of which are office visits.  Yet, since the new CPT code 99490 is an E&M code and is intended for coverage of monitoring chronic conditions, the two services can now be combined as chronic care management and remote patient monitoring with a combined monthly fee of approximately $100.  Notably, the 99490 and 99091 codes are available nationwide, as they are not considered by CMS as rural-only “telehealth” services.  CMS also added seven new procedure codes for telehealth services, including annual wellness visits, psychotherapy services, and prolonged services in the office.  Coverage under these new codes would begin in 2015.

Historically, Medicare has provided limited coverage for telehealth services, which has included coverage for interactive audio and video telecommunications that provide real-time communications between a practitioner and a Medicare beneficiary while the beneficiary is present at the encounter (Social Security Act § 1834(m); 42 C.F.R. § 410.78; Centers for Medicare & Medicaid Services, Medicare Benefit Policy Manual, ch. 15, § 270).  Medicare only has covered the provision of telehealth services if the beneficiary is seen: (a) at an approved “originating site” (e.g., physician offices, hospitals, skilled nursing facilities); (b) by an approved provider (e.g., physicians, nurse practitioners, clinical psychologists); and (c) for a small defined set of services, including consultations, office visits, pharmacological management, and individual and group diabetes self-management training services.

In a November 1, 2014 news release, American Telemedicine Association CEO Jonathan Linkous stated that the new final rule “has been a long time coming, but this rulemaking signals a clear and bold step in the right direction for Medicare” and, importantly, “allows providers to use telemedicine technology to improve the cost and quality of healthcare delivery.”

Earlier this week, a popular source of regulatory news published an article claiming FDA “finalized a new rule this week that prohibits manufacturers from using so-called “split-predicates”. However, it appears that the article may instead be referencing the Final Guidance for Industry and Food and Drug Administration Staff entitled “The 510(k) Program: Evaluating Substantial Equivalence in Premarket Notifications [510(k)]” that FDA published earlier this week.  Unfortunately, as often occurs on the Internet, the post was disseminated by several other popular sources of regulatory news.

This confusion comes a little less than three months after four Senator’s sent a letter to FDA raising concerns about FDA draft guidance “becoming the default FDA policy and position.”

Guidances and final rules carry different legal weight.  Final regulations are legislative rules that have the force of law. Whereas, guidances do not set new legal standards, impose legal requirements or have the force of law. Instead guidances are issued to help interpret or clarify an existing regulation.   

FDA certainly understands this difference.  As FDA notes, “FDA regulations are [] federal laws, [even though] they are not part of the [federal Food Drug & Cosmetic Act (FD&C Act)].”  Whereas, “FDA guidance describes the agency’s current thinking on a regulatory issue [but guidance] is not legally binding on the public or FDA.”

FDA also emphasizes this latter point in many of its guidance documents by including the following disclaimer:

This guidance represents the Food and Drug Administration’s (FDA’s) current thinking on this topic. It does not create or confer any rights for or on any person and does not operate to bind FDA or the public. You can use an alternative approach if the approach satisfies the requirements of the applicable statutes and regulations. If you want to discuss an alternative approach, contact the FDA staff responsible for implementing this guidance. If you cannot identify the appropriate FDA staff, call the appropriate number listed on the title page of this guidance.

Unfortunately, not everyone fully appreciates the difference between rules and guidance. The recent confusion suggests that there is a disconnect between FDA’s position on the difference between guidance and final rules and the understanding of at least some in industry.  Therefore, as FDA reviews its current guidance development practice, it is important that FDA look for ways to ensure (draft or final) guidance is just that, guidance.  For example,

  • FDA should make the guidance development process more efficient and so that there is a significant difference between the time it takes to publish a final guidance and the time it takes to implement a final rule;
  • If a manufacturer uses an alternative approach and provides reasonable support for taking such an approach, FDA should be required to provide a reasonably explanation as to why the alternative is insufficient;
  • FDA should include a process for quickly and efficiently incorporating alternative approaches into existing final guidance.