Telehealth services are often billed at a lower code than office visits

By Susan Morse for Healthcare Finance

Despite being able to be reimbursed for telehealth services at the higher facility rate for another year, providers are frequently billing for these virtual visits at a lower level-of-service code, Epic Research has found.

Epic’s study found this holds true for both primary and specialty care. Telehealth visits are more frequently coded with a lower level-of-service billing code than in-person office visits of the same specialty.

The Epic Research team evaluated the level-of-service billing codes for 1.3 million telehealth visits and 5.2 million office visits from January 1, 2022 through this past June 30.

Higher level-of-service codes represent more complex patient encounters, with LOS 1 being the least complex and LOS 5 the most complex.

Telehealth visits were, on average, consistently billed at a lower level-of-service than office visits of the same type, with the exception of new patient specialty telehealth visits. These were billed at LOS 5 slightly more frequently than office visits of the same type.

“Reimbursement is one of many factors that an organization must consider as part of their telehealth strategy, and future research will be needed to determine how those factors are influencing decisions to increase or decrease telehealth offerings. For example, reimbursement for telehealth may be lower for organizations that triage lower level of service encounters to telehealth in order to ensure that in-person care is available for patients who need a higher level of service, but those factors were not evaluated as part of this study,” said the Epic Research Team.
 

WHY THIS MATTERS

Billing for lower levels-of-service means providers are not being paid as much for telehealth as they are for in-person visits.

Epic suggests that the reason for the difference in billing is that some studies suggest that telehealth visits are more often used for chronic disease management, existing patient follow-up and medication management, which are typically considered less complex visits than new patient visits or those that require a physical assessment.

Patients were matched in the telehealth cohort to patients in the office visit cohort by age, sex, race, ethnicity, social vulnerability index, census region, rural or urban area, specialty, chief complaint, and whether the patient was a new or established patient. 

For primary care, Epic found that across both telehealth and office visits, visits coded with an LOS of 3 or 4 were the most common. However, more than half (53.7%) of primary care telehealth visits for established patients were coded at LOS 3 compared to 43.3% of primary care office visits. Conversely, 40.8% of primary care telehealth visits were coded at LOS 4, while more than half (52.5%) of primary care office visits for established patients were coded at LOS 4.  

For specialty care, both telehealth and office visits for established patients were coded at LOS 4 most frequently. The analysis found 64.1% of specialty office visits were coded at LOS 4 or 5, compared to 56.8% of specialty telehealth visits. Similar trends were seen in new patient telehealth and office visits for both primary and specialty care.

THE LARGER TREND

Prior to the public health emergency, telehealth was allowed in certain settings, such as in rural areas, and reimbursement was lower than for an in-person visit. For these reasons, its use among hospitals and physician practices was limited.

When COVID-19 prevented in-person visits, the Centers for Medicare and Medicaid Services granted telehealth flexibilities under the public health emergency. Telehealth services were reimbursed at the higher facility rate. Its use soared.

When the PHE ended in May, CMS did not return to business as usual for telehealth, twice extending the period for the flexibilities and reimbursement. That now expires at the end of 2024, with Congress needing to present a permanent solution.