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BCBS Emergency Room Rule Fast Approaching Despite Controversy

BCBS Emergency Room Rule Fast Approaching Despite Controversy

The controversial reimbursement policy advanced by Blue Cross of Georgia (BCBSGA) last month is hurtling toward an implementation date of July 1, with big implications for emergency rooms in Georgia. The goal of the policy is to reduce costly visits to emergency rooms by tightening coverage rules for non-emergent conditions. 

BCBSGA, a subsidiary of Anthem, sent out letters to members in May stating, “Going to the emergency room (ER) or calling 9-1-1 is always the way to go when it’s an emergency. And we’ve got you covered for those situations … But starting July 1, 2017, you’ll be responsible for ER costs when it’s NOT an emergency. That way, we can all help make sure the ER’s available for people who really are having emergencies.” This policy change will impact large swaths of Georgia, especially rural Georgia, with BCBS being the only insurer providing individual insurance plans in 96 of Georgia’s 159 counties.

The new policy defines inappropriate visits to the ER as any visit except emergency visits, defined as:

“Emergency” or “Emergency Medical Condition” means a medical or behavioral health condition of recent onset and sufficient severity, including but not limited to, severe pain, that would lead a prudent layperson, possessing an average knowledge of medicine and health, to believe that his or her condition, sickness, or injury is of such a nature that not getting immediate medical care could result in: (a) placing the patient’s health or the health of another person in serious danger or, for a pregnant woman, placing the woman’s health or the health of her unborn child in serious danger; (b) serious impairment to bodily functions; or (c) serious dysfunction of any bodily organ or part. Such conditions include but are not limited to, chest pain, stroke, poisoning, serious breathing problems, unconsciousness, severe burns or cuts, uncontrolled bleeding, or seizures and such other acute conditions as may be determined to be Emergencies by us.

The new policy does not apply to (1) children younger than fourteen, (2) members directed to the ER by another medical provider, (3) instances where an urgent care clinic is more than fifteen miles away from the member’s primary address, or (4) when emergency care is delivered on Sundays or major holidays.

Similar letters were sent to Anthem customers in Missouri and Kentucky.

The “Prudent Layperson” Standard

But is BCBSGA’s new policy legal? The American College of Emergency Physicians (ACEP) has criticized the rule, arguing it violates the “prudent layperson” standard. The prudent layperson, as codified in federal regulations (see 45 C.F.R. § 147.138) and Georgia law (see O.C.G.A. §§ 33-20A-3, 9) requires certain insurers to cover services where a prudent layperson, possessing an average knowledge of medicine and health, would believe the condition to be one of a specified number of emergent situations.

For example, if a member arrives at the ER for symptoms reasonably believed to be related to a heart attack, and it turns out that the member was not experiencing a heath attack, the insurer is required by law to cover the member’s ER visit under the prudent layperson standard.

A spokesperson from Anthem has countered that the policy actually tracks the language of the “prudent layperson” standard and simply enforces rules that have long existed in provider contracts and policies.

But, BCBSGA’s notice to providers states the claims review “will take into consideration the symptoms that brought the member to the emergency room as well as the final diagnosis.” This is likely the point on which any legal debate over the new policy would turn, with challengers arguing the “prudent layperson” standard does not allow for review of final diagnoses.   

EMTALA Conundrum

Another legal issue the policy raises is a hospital’s obligation under the Emergency Medical Treatment and Active Labor Act (EMTALA). Under EMTALA, hospitals are federally mandated to treat any person presenting to the emergency room with an emergency medical condition regardless of that patient’s ability to pay.

The definition of “emergency medical condition” under EMTALA (42 C.F.R. § 489.24) is very similar to that of the “prudent layperson” standard — and therefore similar to the new BCBSGA policy — albeit with subtle differences. Regardless of the similarities, a hospital may be subject to two differing interpretations, feeling pressure to treat a patient under EMTALA but then denied payment according to the BCBSGA medical director’s review. This may lead to more uncompensated care among a hospital’s insured population, on top of the uncompensated care regularly incurred treating uninsured patients.

Telehealth’s Role

BCBSGA is recommending telehealth as one alternative to non-emergent ER visits, according to one report. Specifically, the May letter to customers suggested use of BCBSGA’s preferred telehealth vendor, LiveHealth Online: “[I]f a member can’t get an appointment with their primary care doctor, most non-emergency medical conditions can be easily treated at retail clinics, urgent care clinics, or 24/7 telehealth services such as LiveHealth Online.”

The utilization of telehealth for low-acuity conditions and triage is becoming increasingly popular with health plans. Payers welcome telehealth as an alternative to costly, non-emergent ER visits, and coverage policies like that of BCBSGA will likely continue to drive consumers to lower-cost telehealth options.

Boling & Company will continue to follow the implementation of this new policy to better inform individuals and healthcare providers in Georgia about how they will be impacted.


Disclaimer: The foregoing materials are provided for informational purposes only, and are not to be construed as legal advice. Please consult an attorney before applying this guidance to any particular facts or circumstances. 

Flurry of Federal Legislation on Telehealth - Recap

Flurry of Federal Legislation on Telehealth - Recap

If the first several months are any indication, 2017 promises to be a big year for telehealth on Capitol Hill. Below is a current rundown of pending legislation that aims to expand access to healthcare through telehealth/telemedicine.

CHRONIC Care Act of 2017

The bipartisan Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act of 2017 contains a variety of proposed Medicare changes, such as expanding in-home care and strengthening accountable care organizations (ACOs).

The legislation also seeks to improve access to telehealth services. Specifically, the CHRONIC Care Act would:

·      allow at-risk ACOs to provide telehealth services without Medicare’s geographic restrictions and with the home as an added originating site;

·      allow Medicare beneficiaries receiving dialysis treatments at home to complete monthly check-ins with their doctor via telehealth;

·      expand coverage for telehealth services in Medicare Advantage plans; and

·      remove Medicare’s geographic restrictions for telestroke services.

The Congressional Budget Office (CBO) estimates the costs of the CHRONIC Care Act to be negligible. Expanding Medicare reimbursement of telehealth services is projected to cost $150 million over a decade per the CBO, but increased coverage of telehealth via Medicare Advantage plans is projected to save Medicare $80 million. Overall, the CHRONIC Care Act received a positive score from the CBO, thanks in large part to significant cuts in the Medicare Improvement Fund.


On May 3, 2017, six senators reintroduced a bipartisan bill designed to expand Medicare coverage for telehealth services and remote patient monitoring. The legislation, Creating Opportunities Now for Necessary and Effective Care Technologies (CONNECT) for Health Act of 2017, was initially introduced last year by the same six senators. The CONNECT Act includes many of the same provisions as the CHRONIC Care Act, but builds on them.

The bill has five stated primary goals:

1.     Build upon provisions in the CHRONIC Care Act of 2017 to expand telehealth platforms in accountable care organizations and Medicare Advantage, as well as patients undergoing home dialysis and stroke treatment programs;

2.     Expand remote patient monitoring programs for individuals with chronic conditions;

3.     Expand telehealth and remote patient monitoring programs at community health centers and rural clinics, and integrate the technology into bundled and global payment programs;

4.     Give HHS the authority to lift restrictions on telehealth—including geographic limitations, originating site restrictions, reimbursements limitations, and restrictions on the use of store-and-forward technology—when quality and cost effectiveness criteria are met; and

5.     Expand the use of telemental health services.

The CONNECT for Health Act has garnered more than 50 endorsements, including support from the American Medical Association, American Telemedicine Association, Healthcare Information and Management Systems Society, Federation of State Medical Boards, and a wide array of vendors and health systems.

The Hallways to Health Act

The Hallways to Health Act was also recently reintroduced in Congress. The legislation would provide federal support to expand telehealth access to schools and medically underserved areas.

The bill would amend Title XXI of the Social Security Act to:

1.     Provide grants for school-based health centers that partner with community health care workers who can coordinate care and services in the community for families;

2.     Create a demonstration project to provide telehealth services at centers and expand existing telehealth services in medically underserved areas; and

3.     Ensure school-based health centers can be reimbursed for covered services under Medicaid and the Children’s Health Insurance Program at the same level as services provided in a physician’s office or outpatient clinic.

The Telehealth Innovation and Improvement Act of 2017

The Telehealth Innovation and Improvement Act is another piece of current bipartisan legislative activity that touches on telehealth. The legislation seeks to encourage health providers to launch telehealth programs through HHS’ Center for Medicare and Medicaid Innovation (CMI). In addition, the bill calls on the CMI to evaluate telehealth models “for cost, effectiveness, and improvement in quality of care without increasing the cost of delivery,” and to reimburse telehealth models under Medicare if they satisfy those criteria.

In a press release, the sponsors of the legislation, Senator Cory Gardner (R-Colorado) and Senator Gary Peters (D-Michigan), criticized Medicare for its limited coverage of telehealth, saying CMS sets “a poor industry standard, [discourages] innovation and [restricts] access to specialized services.” Senators Gardner and Peters stressed that expanded reimbursement for telehealth care will benefit citizens of urban and rural communities, and the legislation could help “reduce costly emergency room visits, hospitalizations and readmissions” and “incentivize the healthcare industry to develop new technologies that could potentially reduce costs and improve patient health.”

Furthering Access to Stroke Telemedicine (FAST) Act

Originally introduced in 2015, the Furthering Access to Stroke Telemedicine (FAST) Act was reintroduced to Congress in February 2017. The bipartisan telehealth bill, supported by the American Heart Association (AHA) and the American Academy of Neurology, would alter the Social Security Act to allow Medicare coverage of telestroke services—no matter where the patient is located.

The AHA President Steven Houser, PhD, pointed to quantitative data to support the merits of the bill — “Evidence indicates that telestroke improves patient outcomes and reduces disability. However, nearly 94 percent of the strokes that occur in America take place in areas where telestroke is not paid for by Medicare. We urge Congress to give more Medicare patients access to this proven form of treatment and support the FAST Act.”

Telehealth Capsules - Federal Legislation

Telehealth Capsules - Federal Legislation

Telehealth to Expand in TRICARE; Shown as Viable Treatment Option for PTSD

The recently enacted National Defense Authorization Act for Fiscal Year 2017 will expand the use of telehealth in TRICARE, the federal healthcare program for military personnel and military retirees. Specifically, the law mandates coverage parity for telehealth services with conditions and reimbursement specifications to be defined in upcoming Department of Defense rules. An earlier version of the law contained broad interstate licensure exemptions, which have since been deleted following complaints by the American Academy of Family Physicians, among others.

TRICARE represents an exciting new adopter of telehealth parity, particularly in light of a recent study, to be published in the upcoming February 2017 issue of Behaviour Research and Therapy, showing therapy delivered via telehealth represents a viable treatment option for veterans with post-traumatic stress disorder (PTSD). The study compared the efficacy of home-delivered therapy by videoconference for veterans with PTSD to treatment received at a U.S. Veterans Affairs clinic, finding the home-delivered therapy to be just as effective to treatment at a U.S. VA clinic.  

The study placed veterans with PTSD into two randomly assigned groups. Each group received 10 to 12 therapy sessions to treat the symptoms of PTSD. One group attended therapy sessions at a Veterans Affairs clinic, while the other group consisted of veterans receiving home-delivered therapy via videoconference with a psychiatrist. Researchers found veterans who received home-delivered therapy made similar progress in treating PTSD symptoms as  veterans who received inpatient therapy at a Veterans Affairs clinic.

ECHO Act Signals Continued Commitment to Expansion of Telemedicine

On December 14, President Obama signed the Expanding Capacity for Health Outcomes Act (ECHO Act) into law. The legislation is modeled after University of New Mexico Health Sciences Center’s telehealth initiative “Project ECHO.” Project ECHO uses a “hub-and-spoke” model to connect healthcare specialists with rural healthcare providers and their patient populations using a telehealth platform. Healthcare specialists located at “hub” hospitals conduct virtual clinics and train primary care providers at “spoke” sites, typically located in rural areas. Through the virtual clinics and training, patients can receive care locally at a spoke site, avoiding costly referrals and the need for a patient to travel to the office of a healthcare specialist. 

The ECHO Act requires HHS to study technology-enabled collaborative learning and capacity building models, and the impact of such models on (1) mental and substance use disorders, chronic diseases, prenatal health, pediatric care, pain management, and palliative care; (2) healthcare workforce issues (e.g., shortage of healthcare specialists); (3) public health programs; and (4) delivery of healthcare to rural, medically underserved areas. Donald Berwick, the former administrator of CMS, has stated the model of Project Echo represents a fundamental design shift “from moving the patient to moving the knowledge,” a necessary shift to meet modern healthcare demands. 

The ECHO Act is the latest legislative effort to ensure quality healthcare services to rural communities through the utilization of telehealth. Telehealth will continue to be a point of legislation in upcoming years due to the efficacy and cost-savings associated with the technology.


Disclaimer: The foregoing materials are provided for informational purposes only, and are not to be construed as legal advice. The information relies on limited authority and has not been screened or approved by any governmental agency. Please consult an attorney before applying this guidance to any particular facts or circumstances. 

The Emerging HIPAA/FERPA Conundrum in School-Based Telehealth

The Emerging HIPAA/FERPA Conundrum in School-Based Telehealth

The advent of school-based telemedicine has brought renewed focus on the intersection of two federal laws governing patient privacy: the Health Insurance Portability and Accountability Act (HIPAA) and the Family Education Rights and Privacy Act (FERPA). Many are trying to navigate the tricky confluence of these laws in the context of telemedicine, but there is hardly a well-traveled course. 

By way of background, HIPAA protects the privacy of patient records in nearly all healthcare settings, whereas FERPA protects only student health records maintained in school settings (where the school receives Department of Education funding). The laws are similar in that they generally limit the situations in which a healthcare provider can disclose health information without patient (or parental) consent. However, the laws have a few key differences. For example, under HIPAA, protected health information may be disclosed without consent for “payment, treatment, and operations”; FERPA has no such broad consent exception, but does allow disclosures without consent for “legitimate educational interests” to certain school officials, which might not be permitted recipients under HIPAA.

These differences have historically led school-based health providers to carefully examine whether a record is governed by HIPAA or FERPA. The overly simple answer is that an education record governed by FERPA is specifically exempt from HIPAA’s requirements. That is, In a traditional school-based clinic, a nurse or other provider would be held to confidentiality by FERPA, not HIPAA. 


The involvement of outside parties in school-based care caused the Department of Education and the Department of Health and Human Services, in 2008, to release joint guidance on the intersection of HIPAA and FERPA in school-based healthcare. Beyond clarifying the two distinct zones of HIPAA and FERPA privacy regulation, the report aimed to address some of the scenarios where the distinction was not self-evident. 

Significantly, the agencies identified the HIPAA/FERPA boundary in the context of outside healthcare providers serving schools. Where a person or entity is providing services “on behalf of” a FERPA-regulated school, the report states, the record is subject to FERPA, and therefore not subject to HIPAA; as an example the report cites “a school nurse that provides services to students under contract with or otherwise under direct control of the school.” On the other hand, if an outside party is not acting “on behalf of” the school, such as “a public health nurse who provides immunization or other health services to students on school grounds or otherwise in connection with school activities but who is not acting on behalf of the school,” the record would be governed by HIPAA. 

The “on behalf of” test may not meet many providers’ desired level of certainty. The FERPA regulations provide slightly more insight, adding that FERPA applies to a contractor performing “institutional services or functions…for which the agency or institution would otherwise use employees…under direct control of the school with respect to the use and maintenance of education records.” 


Alas, the 2008 joint guidance did not specifically contemplate the use of telehealth as a delivery mechanism for school-based healthcare. Because many school-based telehealth programs involve the frequent exchange of student health records between school personnel and independent contractors, the line dividing “education records” from HIPAA records is a constantly moving target. 

One might view an outside tele-provider as clearly not “under direct control” of a school with respect to its use and maintenance of medical records, which would mean the provider could treat such records as it normally would under HIPAA. However, such a provider could also be said to act “on behalf of” the school if it is serving as the school’s primary healthcare service, and therefore would be subject to FERPA. 

Moreover, consider this scenario: a provider engaged in school-based telehealth receives a FERPA record from a school nurse. Even if the provider’s own records would be treated as HIPAA records, the record received from the school would be subject to FERPA’s rules regarding redisclosure — essentially, the FERPA disclosure rules themselves. 

Outside providers are not the only parties affected by this overlap; school personnel also must be mindful of their potential HIPAA requirements. In practice, many providers contracting with a school will mandate that the school sign a HIPAA business associate agreement (BAA) as a condition of participation. Thus, even if a school is not statutorily subject to HIPAA because of the FERPA exemption, the school might have contractually committed to comply with certain (if not all) HIPAA provisions via the BAA. 


While this complexity no doubt presents a conundrum for school-based telehealth providers, their outlook is not all doom-and-gloom. In reality, many of the protective measures a provider would take under HIPAA would be similarly beneficial under FERPA’s regulatory scheme, and vice versa. Once a provider commits in earnest to patient privacy, the mastery of the HIPAA-FERPA overlap boils down to a select few details. 

For the outside tele-provider, it is largely academic to think of a scenario HIPAA would not be followed — the gargantuan 1996 law is a fixture in most healthcare settings. But, to protect against the possibility that their records would might be FERPA records, such providers might seek to obtain advance consent that meets the form requirements of FERPA (34 CFR 99.30) and authorizes the HIPAA-permitted disclosures that would require consent under FERPA, i.e. disclosures for payment and operations. 

For school personnel, the question of HIPAA liability will depend on the school’s particular circumstances, including the presence and scope of a BAA. If a school is required to comply with HIPAA’s Privacy Rule, it must be mindful of disclosures that would be routine under FERPA (e.g. to non-treating school officials) that would require consent under HIPAA, and obtain consent for such disclosures before delivering treatment. If a school is required to comply with HIPAA’s Security Rule, it should consult a healthcare attorney in developing policies and procedures to safeguard health records. 


Disclaimer: The foregoing materials are provided for informational purposes only and are not to be construed as legal advice. The information relies on limited authority and has not been screened or approved by any governmental agency. Please consult an attorney before applying this guidance to any particular facts or circumstances. 

CMS Capsules

CMS Capsules

The Center for Medicare and Medicaid Services has released a flurry of rulemaking announcements in recent weeks, touching a broad range of delivery models. We review some notable items here:

End-of-life counseling 

As part of its proposed rule revising the Medicare physician fee schedule, CMS announced it intends to reimburse physicians and other qualified health professionals for conversations with patients and their families regarding end-of-life planning. These new “advance care planning” codes would mark a significant development in Medicare’s treatment of end-of-life care. 

Stark law exception

The physician fee schedule rule also proposed a new exception to the physician self-referral law, known as the “Stark” law, allowing certain health facilities to pay physicians in exchange for assistance in employing "nonphysician practitioners" (nurse practitioners, physician assistants, clinical nurse specialists, certified nurse midwives) in the facility’s service area. Under this exception, physicians could refer patients to the facilities paying for their recruitment assistance without fear of penalties under the Stark law. 

New telehealth services 

The physician fee schedule rule proposed two new reimbursable health services under Medicare: prolonged service in the inpatient/observation setting (CPT 99356-7), and end-stage renal disease (ERSD) services for home dialysis (CPT 90963-5). Reimbursement for these services would be subject to Medicare’s usual geographic restrictions on telehealth. 

Chronic care management in RHCs, FQHCs

Consistent with its introduction of a new code for non-face-to-face chronic care management, CPT code 99490, CMS’s physician fee schedule rule would extend the same payment to rural health clinics (RHCs) and federally qualified health centers (FQHCs). To qualify for reimbursement, the RHC or FQHC must provide at least 20 minutes per month of CCM services to patients with two or more chronic conditions, defined as conditions that are expected to last at least 12 months and place the patient "at significant risk of death, acute exacerbation/decompensation, or functional decline." 

Nursing home CoP overhaul

On July 13, CMS announced a series of major revisions to the Medicare and Medicaid conditions of participation (CoP) for long-term care facilities, the first major rewrite of such rules since 1991. The proposed rule largely brings the CoP into conformity with new technologies and practices that most nursing homes have already adopted, according to the press release. Among the possible impacts, “unnecessary hospital admissions and infections would be reduced, quality care increased, and safety measures strengthened.” 

Home health quality initiative 

On July 7, CMS announced revisions to its home health prospective payment system, including, notably, the introduction of a value-based purchasing program (VBP) for home health. Like hospital VBP, the program would penalize or reward select home health agencies based on quality of performance. The payment adjustment would be a penalty or bonus of up to 5 percent of Medicare payments in 2018 and 2019, increasing to 8 percent by 2021. The list of applicable quality measures can be found here

New joint replacement payment model

Added to the increasing list of innovative payment models tied to quality is CMS’s new “Comprehensive Care for Joint Replacement” program. Like ACOs and other alternative payment models, the new program would make hospitals accountable for the costs and quality of knee and hip replacements, the most common type of inpatient surgery for Medicare beneficiaries. Hospitals that fare comparatively well will be rewarded with bonuses, while those faring poorly will be forced to repay some of their costs.