DMHC tells payors they must continue telehealth payment parity 

September 09, 2020

On September 4, 2020, the California Department of Managed Health Care (DMHC) issued an all plan letter (APL) reminding health plans of the continued requirement to reimburse providers at the same rate for telehealth services, including telephonic visits, as they would for services provided in person and may not subject enrollees to cost-sharing greater than the same cost-sharing if the services were provided in person.

The letter (APL 20-032) was in response to questions DMHC has received regarding the duration of previous APLs (20-009 and 20-013), requiring telehealth payment parity and providing specific billing guidance on billing for telehealth services. The new APL clarifies that the prior APLs remain in effect for the duration of California’s declared state of emergency or until further notice from DMHC, whichever is earlier.

The APL also clarifies that these requirements apply to delegated entities to the extent the health plan delegated the services impacted by these APLs. 

The letter also addressed the issue of health plan requirements to include practice addresses in provider directories. Due to COVID-19, many providers are now providing health care services via telehealth from their home offices during the state of emergency. Acknowledging the privacy concern for providers, DMHC prohibits plans from including providers’ home addresses as the practice address, unless a provider expressly authorizes the plan to do so. Instead, health plans must list the provider’s practice address as of March 3, 2020.

In the early days of the pandemic, the California Medical Association (CMA) was among the first to advocate for payment parity for telehealth services. Telehealth services have proven to be a critical tool for physicians so they can safely provide care to those who need it during the COVID-19 public health emergency.

In response to CMA and other stakeholder concerns, DMHC directed health plans to cover and reimburse telehealth services on the same basis and to the same extent that they would cover and reimburse the same service delivered on in-person basis. However, over the past few months CMA has received a number of calls from physician practices concerned that some health plan websites indicated an end date to the telehealth parity. This APL clarifies that those end dates are not valid for products regulated by the DMHC.

Note Re: Telehealth and ERISA Plans

These requirements do not apply to self-funded ERISA plans. Some self-funded plans are only covering telehealth if it is provided through the plan’s third-party telehealth vendor. The cost sharing waivers also do not apply to ERISA plans. It is currently up to individual employers to decide whether they will waive cost sharing.



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