Important Update on the Telehealth Regulation – Effective July 1, 2019

Posted July 3, 2019

Avoid denials by using place of service – 02

On July 1, 2019, the telehealth regulation requires the Department of Medicaid Services (DMS), Medicaid managed care organizations (MCOs) and commercial health plans to cover medical services provided via telehealth to the same extent they cover medical services provided in-person.  The Medicaid rate for telehealth services will be 100 percent of the fee schedule.

In June, Kentucky Medicaid distributed a provider letter that outlined the use of origin and destination modifiers reserved for use by ambulance providers as a way to capture the location of both the telehealth provider of service and the location of the recipient.

KMA and other key stakeholders were quick to point out that the modifier combinations selected are neither HIPAA compliant nor the industry standard. Therefore, such modifier combinations could cause claim denials when used in combination with professional services, including evaluation and management services.  More importantly, the use of these modifiers is not necessary. Unlike Medicare, the Kentucky telehealth regulation does not limit the treatment of the patient to specific areas. Kentucky patients may live anywhere and receive telehealth treatment so long as the physicians and other covered health care practitioners using telehealth are licensed in Kentucky and perform within their scope of practice.

As a result of the advocacy by KMA and other key stakeholders, DMS has postponed the two letter modifier requirement and will only require physicians and other healthcare providers to use place of service “02 – telehealth,” which will both identify and process the service as a telehealth service.

KMA appreciates DMS working with the Association on the implementation of this important regulation. Proper application of the regulation will improve access to care for Kentuckians.

Additional claim processing changes will most likely occur during the implementation phase of the telehealth regulation. If you need assistance or have questions about the telehealth regulation contact Lindy Lady, KMA Business Advocacy Manager, at lady@kyma.org.