Affidavit: Healthcare and the Law - Telehealth: Healthcare's New Virtual Reality

Contributors: Erin M. Duffy and Taylor Hertzler
To learn more about Erin and Taylor, click here.

 

Telehealth start-ups have been the latest group to take advantage of the pandemic-driven regulatory flexibilities granted in the healthcare space. While legal and healthcare professionals have learned over the past two years how to benefit from COVID-19 waivers and regulation relaxations, entrepreneurs are now using those same benefits to create all-new healthcare tools, particularly in the mental health space. From audio-only treatment for patients with substance use disorders (“SUDs”) to full-service digital telehealth platforms, these tools bear potential to reshape virtual medicine — provided their developers enable them to last beyond the pandemic.

1. Imposed and lifted rules
Telehealth is the delivery of healthcare services through electronic communication. The Centers for Medicare & Medicaid Services (“CMS”) has been reimbursing for telehealth services since 2018. But the COVID-19 Public Health Emergency (“PHE”) has led CMS and several federal entities to waive many of the usual requirements surrounding these services, granting providers more flexibility to address healthcare needs during the pandemic.

Key requirements that have been waived concern privacy, the patient’s location during telehealth services, and the manner of patient-provider interaction. The privacy framework of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), with its amending legislation and regulations, would normally prohibit many forms of telehealth visits due to insufficient security protections.1 But the Department of Health and Human Services (“HHS”) announced at the beginning of the PHE its intent to exercise enforcement discretion toward these rules for good-faith use of less secure services, expressly endorsing the use of popular platforms like Zoom, Skype, or Google Hangouts.2 This discretion, however, lasts only during the PHE.

Concerning location, standard telehealth rules dictate the patient’s location, called the “originating site” in CMS regulations, be a physician’s office or other authorized healthcare facility.3 CMS paused this requirement through an 1135 Waiver, thus allowing patients to receive telehealth services within their own homes, for the duration of the PHE. But CMS then made this change permanent for SUD patients by adding “[t]he home of an individual (only for purposes of treatment of a substance use disorder or a co-occurring mental health disorder[)]” to the definition of “originating site.”4

For non-SUD mental health patients, CMS made the change permanent for mental health treatment generally — but conditioned on certain in-person treatment occurring before and after the start of virtual care.5 At the same time, CMS also relaxed patient-provider interaction requirements for mental health generally. Standard telehealth rules require “audio and video equipment permitting two-way, real-time interactive communication between the patient and [the provider].”6 CMS made a caveat to this requirement so that for “services furnished for purposes of diagnosis, evaluation, or treatment of a mental health disorder to a patient in their home,” patients may opt to use audio-only communication.7

This relaxation extends into prescription services. Generally, prescribing a controlled substance over the internet requires an in-person medical examination.8 But pursuant to the PHE declaration, HHS and the Drug Enforcement Agency (“DEA”) asserted the telemedicine allowance under that controlled-substances statute applies to all schedule II-V controlled substances, provided the prescription is for a legitimate medical purpose, the telemedicine communication meet certain technical standards, and the provider is following state and federal law.9

  • Using the new flexibilities to develop new services

Platform developers have taken advantage of these flexibilities to produce new healthcare tools that would have been impossible under pre-pandemic rules. The above rules are particularly friendly toward mental health treatment platforms. But the extent of the new freedoms have allowed even the development of full-service virtual health platforms.

Consider Cerebral, Inc.10 Cerebral runs a mobile app and online platform to provide virtual mental health services. Patients pay a monthly fee for one of three plans: therapy, medication services, or medication with therapy. Patients may pay out of pocket, but Cerebral also accepts payments through FSAs, HSAs, and even several insurance companies. Insurance availability depends on the state (Cerebral operates in all fifty states and Washington, D.C.), but accepted insurers include Aetna, Anthem, Blue Cross Blue Shield, Cigna, and Medicare. Cerebral launched in 2020, with investment help from Access Industries, and aims to be available to all insured Americans by 2023.11 By June 10, 2021 it had quintupled its valuation to $1.23 billion; six months later, it quadrupled that valuation to $4.8 billion following an equity-financing round led by SoftBank Vision Fund 2 that brought in $300 million.12

Existing entities like Yale Medicine have also benefited.13 Yale began using Zoom for telepsychiatry visits early in the pandemic. The switch to virtual care offered unique opportunities to interact with mental health patients through activities like live cooking lessons or videogames. These also helped to engage children in mental health visits. With in-person services returning, the development of online treatment has granted patients the flexibility to choose between virtual or in-person options. This flexibility also expands the scope of treatable patients, for transportation barriers are often greater than technological ones.

Or consider Antidote Health, which provides a full-service platform.14 As such, Antidote provides a select set of services, including primary care physicians, medication prescriptions, and even, as part of its PLUS plan, a health debit card for medications. Patients can pay for a one-time visit or can select a monthly individual plan or family plan, although Antidote does not yet work with any insurers. When patients request services, Antidote uses an AI chatbot system to triage patients and connect them to the appropriate doctor. As the above DEA relaxations apply only to mental health, Antidote cannot prescribe controlled substances but prescribes many other routine treatments.  After launching in January 2021, Antidote raised $12 million in August 2021 through seed funding by angel investors like iAngels, Well-Tech Ventures, and Flint Capital.15

2. Post-PHE precautions
While most of the above flexibilities are here to stay, many begin and end with the PHE. Further, state-level telehealth issues remain. The question of whether a physician licensed in one state can treat virtually a patient located in another state differs state-by-state. And some Medicaid companies do not pay for out-of-state services. HHS has created a guide to telehealth licensing requirements and interstate compacts to help patients navigate these questions, but the difficulties remain.16

Added opportunities like the ability to use Zoom for patient calls give developers the flexibility to try new ideas without having to reinvent every part of telehealth. But such developers should be prepared to find alternative solutions once the PHE ends.


Contact Erin at:
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Contact Taylor at:
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Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. 

References

  1. See 45 C.F.R. §§ 160, 164.

  2. Press Release, U.S. Dep’t of Health & Hum. Servs., Notification of Enforcement Discretion for Telehealth Remote Communications During the COVID-19 Nationwide Public Health Emergency (Mar. 30, 2020)

  3. 42 C.F.R. §§ 410.78(a)(4), (b)(3).

  4. 42 C.F.R. § 410.78(b)(3)(xii); 85 Fed. Reg. 84472, 84541 (Dec. 28, 2020).

  5. 42 C.F.R. § 410.78(b)(3)(xiv); 85 Fed. Reg. 64996, 65666 (Nov. 19, 2021).

  6. 42 C.F.R. 410.78(a)(3).

  7. Id.; 86 Fed. Reg. 64996, 65060 (Nov. 19, 2021).

  8. 21 U.S.C. § 829(e).

  9. Id. at § 802(54)(D); U.S. Dep’t of Justice, Drug Enforcement Admin., Diversion Control Division, Covid-19 Information Page, https://www.deadiversion.usdoj.gov/coronavirus.html (last visited Jan. 30, 2022).

  10. See Cerebral, https://cerebral.com/ (last visited Feb. 18, 2022).

  11. Gillian Tan, Mental-Health Startup Cerebral Nabs $1.2 Billion Valuation, Bloomberg (June 10, 2021), https://www.bloomberg.com/news/articles/2021-06-10/mental-health-startup-cerebral-nabs-1-2-billion-valuation.

  12. Id.; Sakshi K S, Cerebral’s valuation quadruples to USD 4.8 billion after accumulating USD 300 million in a SoftBank funding round, The Global Economics (Dec. 9, 2021), https://www.theglobaleconomics.com/2021/12/09/cerebral/amp/

  13. See Carrie MacMillan, Why Telehealth for Mental Health Care Is Working, Yale Med. (Sept. 16, 2021), https://www.yalemedicine.org/news/telehealth-for-mental-health.

  14. See Antidote Health, https://www.antidotehealth.ai (last visited Feb. 18, 2022).

  15. Anuja Vaidya, Antidote Health nabs $12M in seed round to grow AI-driven virtual HMO, MedCity News (Aug. 27, 2021), https://medcitynews.com/2021/08/antidote-health-nabs-12m-in-seed-round-to-grow-ai-driven-virtual-hmo/.

  16. U.S. Health Resources & Servs. Admin., Telehealth Licensing Requirements and Interstate Compacts, HHS (https://telehealth.hhs.gov/providers/policy-changes-during-the-covid-19-public-health-emergency/telehealth-licensing-requirements-and-interstate-compacts/) (updated Sept. 8, 2021, last visited Jan. 30, 2021).