Overseas Telemedicine Denied

Providers should remain vigilant regarding their provision of telehealth services to Medicare beneficiaries as such services remain subject to numerous stringent rules and regulations. The United States Circuit Court for the District of Columbia clearly demonstrated the need for such vigilance in the matter of RICU, LLC v. United Stated Department for Health & Human Services, et al.

In RICU, RemoteICU, a telehealth service company comprised of US-trained, licensed, and board certified physicians who are located outside of the US, contracted with several hospitals to provide telehealth services to patients located within the US during the COVID-19 pandemic. However, claims made by the hospitals for the telehealth services were denied, as CMS’s final rule provides that, although the patient’s location is considered the site of treatment (the originating site), “for payment purposes, the site of service for the telehealth service is the location of the physician or practitioner at the distant site.” Hence, Medicare refused payment as CMS guidance (66 FR 55330) on underlying Medicare telehealth regulations (42 CFR 410.78) specifically redefined payment rules to base reimbursement for telehealth services on the physician’s location, thereby triggering Medicare’s prohibition on payment for services provided by physicians located outside the United States (42 U.S.C 1395y(a)(4); 42 C.F.R 411.9(a)).

Ultimately, the DC Circuit did not rule on the substance of the Medicare guidance, as it upheld dismissal based on RemoteICU’s failure to exhaust administrative remedies with the Department of Health and Human Services prior to filing its lawsuit. The full text of the RICU, LLC v. United Stated Department for Health & Human Services, et al. decision can be found here.

Statute Expanding Telehealth Medicare Coverage of Telehealth Services Passes the House of Representatives

Legislation to expand and extend Medicare coverage of telehealth services beyond the end of the federal COVID-19 Public Health Emergency period was recently approved by the United States House of Representatives. Under the Advancing Telehealth Beyond COVID-19 Act of 2022, certain telehealth flexibilities would be extended until December 31, 2024, should the COVID-19 emergency period end before that date. Specifically, the current House-approved version of the bill would allow:

  1. beneficiaries to continue to receive telehealth services at any site, regardless of type or location (e.g., the beneficiary's home);
  2. occupational therapists, physical therapists, speech-language pathologists, and audiologists to continue to furnish telehealth service;
  3. federally qualified health centers and rural health clinics to continue to serve as the distant site (i.e., the location of the health care practitioner);
  4. evaluation and management and behavioral health services to continue to be provided via audio-only technology; and
  5. hospice physicians and nurse practitioners to continue to complete certain requirements relating to patient re-certifications via telehealth.

The bill would also delay implementation of certain in-person evaluation requirements for mental health telehealth services until at least January 1, 2025. The full text of the House-approved version of the Advancing Telehealth Beyond COVID-19 Act of 2022 can be found here.

Appeals Court Says Testing Laboratory Can Sue HHS Over Botched Overpayment Decision

A significant decision regarding judicial review of provider recoupment of funds overpaid to Medicare came out of the Court of Appeals for the Fifth Circuit earlier this year. In D&G Holdings v. Becerra, the Fifth Circuit reopened and remanded a matter involving recoupment of funds by a diagnostic testing laboratory in relation to a botched overpayment decision by Novitas, a Medicare Administrative Contractor (“MAC”).

In the underlying matter, Novitas determined that the lab had been overpaid by more than $8M by Medicare and began recouping funds. After challenging the determination with HHS’s administrative review process, Medicare ultimately owed the lab over $4.6M. However, the lab was only paid $1.8M, which lead to the present action to collect the remaining balance owed by the government.

The District Court had dismissed the case accepting HHS’s argument that the lab could not bring their repayment claim directly to federal court without first attempting to resolve it through HHS’s administrative process. However, the Fifth Circuit reversed the District Court’s decision after applying Shalala v. Illinois Council on Long Term Care Inc. where the Supreme Court determined that there are certain circumstances where questions that were not strictly presented to the administrative agency are reviewable by the federal courts under the Medicare Act (42 U.S.C. 405(g)). The Fifth Circuit determined that “effectuations” of final agency decisions fall under the jurisdiction of the Federal Courts and that repayment to the lab was an effectuation of the final agency decision that Novitas had erred in its initial recoupment.

Providers submitting claims to federal benefit programs, such as Medicare, should take notice of this decision as it highlights several key aspects of challenging federal recoupments. In D&G Holdings, the lab received the recoupment notice from Novitas in 2014, and it took three years to navigate through HHS’s administrative appeals system to receive a favorable determination in 2017. More than seven years after the initial notice of recoupment, the lab still had not received payment from Medicare. Moreover, D&G Holdings highlights the limited availability of judicial review for such administrative actions, generally requiring exhaustion of all administrative remedies prior to filing. The full text of the D&G Holdings, LLC f/d/b/a Doctor’s Lab v. Becerra decision can be found here.