Ramona Midkiff

Mark E. Dornauer
Robert Bryce

October 28, 2020

The COVID-19 pandemic has led to a surge in demand for everything from hand sanitizer and face masks to lumber and toilet paper. It has also led to the soaring use of telehealth services: Between April 2019 and April 2020, national privately insured telehealth claims’ increased by 8,336 percent (as a proportion of total medical claims). While those ratios eventually tapered in the proceeding months as in-person visits rebounded, there’s no doubt that more patients and providers are relying on telehealth than ever before. But rural Americans are 10 times more likely to lack broadband access than their urban counterparts. In 2018, the Federal Communications Commission (FCC) estimated that one-quarter of rural Americans—and one-third of Americans living on tribal lands—did not have access to broadband (meaning download speeds of at least 25 megabits per second). By contrast, less than 2 percent of urban Americans lacked that same access.

The lack of broadband in rural areas is one of the most striking inequalities in US society. Due to the lack of broadband availability, tens of millions of rural Americans aren’t able to “see” their doctor over the internet in the same way urban Americans can.

Making matters worse, financially strapped rural hospitals are being shuttered by the dozens. An estimated 47 percent of the country’s 1,844 rural hospitals are operating in the red. Since 2005, at least 174 rural hospitals have closed, including 47 since 2018. Fifteen have closed in 2020 alone. A recent analysis found that about 25 percent of rural hospitals are at high risk of closing. More than 80 percent of these at-risk hospitals are considered highly essential to their communities and if shuttered would greatly reduce physical access to care. These closures underscore the importance of telehealth in rural areas.
Rural America Is Becoming More Racially Diverse

The COVID-19 pandemic has not impacted the United States uniformly. Indeed, densely populated urban centers initially bore the brunt of the disease with certain minority populations infected at higher rates. As COVID-19 migrated from big cities to smaller towns, minority populations continued to suffer disproportionately higher infection rates. Even in predominately rural states, such as South Dakota, Asian Americans became infected at rates six times higher than their share of the population. Similarly, in New Mexico, Native Americans accounted for more than half of the COVID-19 confirmed cases but only comprised 11 percent of the population. These trends underscore an important aspect about the demographics of rural America: It is far from monolithic.

In fact, rural America is becoming increasingly diverse. In 2010, one in five rural Americans was a person of color or Indigenous individual—up from one in seven in 1990. The 2020 census will likely be even higher. Specifically, recent immigration patterns have changed the racial and ethnic composition of rural regions. In a 2018 Center for American Progress report, a sample of 2,767 rural places witnessed an average population decline of 4 percent through a 12 percent decline in native-born population but a 130 percent growth in immigrant populations. Yet, alarmingly, rural Black, Latino, Asian, and Indigenous adults are also less likely to have a personal doctor and more likely to forgo routine health care visits due to costs, just like their urban peers.

Moreover, rural Americans are statistically poorer than their urban peers   across all racial and ethnic backgrounds. According to the Census Bureau’s 2013–17 five-year estimates from the American Community Survey, poverty rates for mostly rural (16.3 percent) and completely rural (17.2 percent ) counties stood higher than mostly urban counties (14.3 percent). Similarly, in the same survey, predominantly urban counties reported household incomes of $59,970 while mostly and completely rural counties disclosed figures of $47,020 and $44,020, respectively. Arguably, for rural patients, the cost of health care matters nearly as much as the access to it—with telehealth offering a cheaper and more accessible alternative during the COVID-19 pandemic.
A New Deal–Inspired Solution

This rural telehealth crisis must be addressed at the federal level.

In 1930, nine out of ten rural farms and ranches in the country were not connected to the electric grid. Without electricity, rural economies were being left behind. Women and girls were forced to haul water and wash clothes by hand. Factories and big employers congregated in cities where electricity was cheap and abundant.

The New Deal changed that. With the passage of the Public Utility Holding Company Act in 1935 and the Rural Electrification Act of 1936, federal funding allowed cooperatives and other entities to string wires to rural areas. By 1950, about 9 out of 10 rural farms and ranches were connected to the electric grid. Today, that figure is close to 99 percent.

Similar federal action is needed today to solve the rural broadband problem. In 2019, the Pew Research Center found that roughly 63 percent of rural Americans have home broadband internet, still 12 and 14 percentage points lower than their urban and suburban counterparts, respectively.

How much will it cost to bridge the digital divide? Stringing fiber optic cable costs about $20,000 per mile. That’s a lot of money to spend when some rural areas may only have a few houses for every mile of cable. But that’s the very same problem that had to be overcome with rural electrification.

In 2017, Deloitte Consulting put the cost of extending rural broadband at about $40 billion. A 2018 analysis by the National Rural Electric Cooperative Association found that about 6.3 million electric co-op households “totaling 13.4 million people, lack access to adequate, high-speed broadband service.” The association’s cost estimate for addressing the problem was the same as Deloitte’s: about $40 billion.

Politicians are paying attention to the problem. Last year, FCC Chairman Ajit Pai approved $5 billion to improve rural broadband, and later this month the FCC will hold a reverse auction for some $20 billion in grants being made available through the Rural Digital Opportunity Fund. In addition, former Vice President Joe Biden has pledged to spend $20 billion on rural broadband infrastructure and plans to triple the US Department of Agriculture’s Community Connect grants partnering with rural communities across the US.

Whatever the total cost of solving the rural broadband challenge, it is clear that tens of billions of dollars in federal investment is needed.

Critics may claim that the private sector can, and should, solve this problem. But if that were true, it would have already done so. Back in the 1930s, electric companies had the ability—but not the economic incentive—to electrify rural areas. The same holds true today for rural broadband. Today’s lack of rural broadband is a market failure that can only be cured with federal dollars.

Federal investment in rural electrification helped ignite investment across the country. Manufacturers didn’t have to locate near big cities, instead, they could build factories in rural areas where land was cheaper. Electric machinery and refrigeration made farms and ranches more productive. Today, in an era where remote work is increasingly common, rural and urban Americans alike need broadband to stay connected and productive.

Federal investment in rural broadband could help reduce health care costs because it will give patients more options in how and where they seek medical care. Multiple studies have found that as hospitals close, competition declines and prices go up. If telehealth appointments provide a less costly option than in-person visits, then federal spending on rural broadband could ultimately be offset by smaller outlays for Medicare.

To be clear, federal investment in rural broadband should come with some caveats, including some influence with regard to pricing. For instance, broadband prices in a region that has benefited from federal loans should not exceed the prices paid by customers in the two closest exurban areas. Furthermore, to ensure competition, the FCC—along with the respective offices at the Federal Trade Commission and Department of Justice—should monitor and enforce antitrust measures.
An Impact Beyond Telehealth

Rural broadband is not just about telehealth. The pandemic has proven that it is also essential for education and remote work. Microsoft CEO Satya Nadella recently declared that “broadband is a fundamental right.” However, just like in the 1930s with electricity, bringing broadband to rural communities will not happen easily or cheaply. Sustained political support—along with tens of billions of dollars in federal grants and loans—will be needed to bring all of rural America into the 21st century.

Now is the time for a new federal program that will energize rural broadband in the same way that the New Deal brought electricity to rural America and bring rural patients out of the digital dark.
Authors’ Note

The authors are visiting fellows at the Foundation for Research on Equal Opportunity.

By Jason Raven | October 23, 2020 at 5:28 PM EDT – Updated October 23 at 6:23 PM

As telehealth transitions from a nice-to-have benefit to an essential form of care delivery, payers will have to make some adjustments in order to permanently integrate telehealth coverage expansions.

October 16, 2020 – Telehealth is metamorphosing and payers will have to take steps in order to permanently integrate telehealth coverage as a key form of care delivery.

When the coronavirus pandemic struck, Donna O’Shea, MD, chief medical officer of population health management for UnitedHealthcare, and other leaders at UnitedHealthcare watched as the payer’s telehealth claims shot up ten times higher than the previous year’s numbers.

It is now a familiar narrative, how the pandemic that swept the nation was a precursor to the largest surge in telehealth utilization in American healthcare’s history. Telehealth uses that might have taken years, perhaps decades, to adopt were integrated into the healthcare delivery system seemingly overnight.

“The COVID-19 pandemic may prove to be a watershed moment for the healthcare system, prompting a surge in the use of virtual care,” O’Shea told HealthPayerIntelligence in an email interview.

Now, payers face a new crossroads with telehealth. As telehealth waivers expire and utilization stabilizes as in-person visits return, the healthcare industry may be tempted to return to a pre-COVID mindset about telehealth.

But that may not be able to happen.

“Going into COVID, telehealth had become a nice-to-have benefit for employees who needed convenient care for minor issues and it wasn’t built with an orientation to be much more than that,” Mike Thompson, president and chief executive officer of National Alliance of Healthcare Purchaser Coalitions, told HealthPayerIntelligence. “What we have found since COVID is that, when telehealth went mainstream, the expectations went way up. As we go forward, I think it becomes more of an integrated strategy. It becomes an expectation that this is a modality that providers will use.”

A shift is coming, Thompson and O’Shea confirmed. Payers will need to support the healthcare system’s transition from viewing telehealth as an “add-on” benefit to a permanent, integrated solution.

There are a couple of questions that payers need to ask in order to develop long-lasting telehealth strategies. First, what telehealth services are the most sustainable long-term? Second, what payment strategies are appropriate for these services? The answers may vary across payers, but, overall, some themes are emerging.

What services can be provided virtually on a long-term basis? 

Payers and providers have implemented telehealth for a broad range of services. However, to integrate telehealth permanently into health plan structures, payers need to assess which services are best suited to telehealth.

An early analysis of COVID-19 telehealth utilization published in May 2020 found that approximately 20 percent of all Medicare, Medicaid, and commercial outpatient, office, and home healthcare spend could transition to virtual care. This equates to around $250 billion worth of care.

Specifically, 35 percent of home healthcare, 24 percent of office visits, and 20 percent of emergency department visits could be virtualized, the report asserted.

In some areas of healthcare, payers can build on progress made before the pandemic struck.

“One of the most exciting spaces and where we’ve seen a lot of the initial growth is going to be in behavioral health,” said Thompson.

Telehealth was already being integrated as a care delivery platform for behavioral healthcare before the pandemic. With the shutdowns and the increase in behavioral and mental healthcare demand, the need to use telehealth for these conditions was inescapable.

The coronavirus pandemic took behavioral telehealth one step further.

“You don’t become a telebehavioral health provider or a regular provider. Increasingly, practices are both,” said Thompson.

The pandemic has confirmed for Thompson—and many in the payer industry at large—that many members now view telehealth as their preferred care delivery model for behavioral healthcare.

Source: McKinsey & Company

Partly, members enjoy the convenience of not having to travel to a provider’s office and still being able to connect virtually. It also diminishes the likelihood that members will experience stigma, Thompson pointed out, since they do not even have to walk outside their homes in order to see their provider.

However, other uses for telehealth have emerged due to the pandemic and the payers must identify which uses should become more permanent.

“Payers are starting to bifurcate a little bit between telehealth as a triage tool versus telehealth as a subacute or medication maintenance or check-in platform for patients to just see their providers,” Tim Epple, principal at Avalere, told HealthPayerIntelligence.

Early data indicates that using telehealth to triage is an effective way to reduce healthcare spending, he said. Ensuring that members are accessing the right level of care and not accruing unnecessary costs through avoidable trips to the emergency room is possible by simply offering a 24/7 triage telehealth platform for members to contact.

“The triage point is where you can see really clear, immediate savings,” Epple added.

In fact, in 2018, AHIP estimated that payers save over $6 billion annually by promoting remote care and telehealth options that allow members to access care from home instead of going to emergency or acute care sites.

Whereas the pandemic has tested and proved telehealth’s triage capabilities, for other telehealth uses payers may need to gather more long-term data to determine if telehealth should be permanently integrated into those care delivery processes.

“It’s going to take a little bit longer for payers to really understand, how does that potentially greater adherence to medication management hit our bottom line? Do we think doing physical therapy or other historically in-person services virtually are actually meeting the bill in terms of outcomes?” Epple said.

Thompson emphasized the ways in which telehealth could develop a more permanent, widespread role in primary care.

“We should put a lot more emphasis on primary care,” he said. “As part of putting more in some primary care, we should be building in virtual integrated care.”

O’Shea at UnitedHealthcare agreed.

“While virtual care has historically helped address minor medical issues, including allergies, pinkeye, fevers, rashes and the regular flu, we are starting to see an expansion of the types of services being offered remotely,” O’Shea noted. “The most promising developments include virtual care resources to help expand access to primary care and support chronic disease management, behavioral health, and certain types of specialty care (dental, vision and hearing).”

O’Shea emphasized that acute or follow-up virtual care can be essential for members who have complex conditions that prevent them from being able to visit the provider’s office in person.

Upon identifying forms of care that can be offered on a long-term basis, payers may find that they have to make adjustments to solidify these benefits.

For example, UnitedHealthcare has added the home as a qualified site of care to make remote patient monitoring and virtual care more accessible.

“Moving forward, we will continue to recognize the home as a qualified site of service,” said O’Shea. “This helps make it more convenient for millions of members to remotely access their own healthcare providers for certain services, including primary care physicians and specialists, outside of the provider’s office. This is an important change designed to help encourage members and care providers to continue to use virtual care, even after the pandemic wanes.”

How do we determine reimbursement for telehealth and virtual care services?

The ongoing conversation about how to properly reimburse for telehealth services will be a huge component of permanently integrating telehealth as a mode of care alongside provider offices, hospitals, and other physical sites of care.

Traditionally in this debate, providers are portrayed as universally advocating for parity between reimbursement for telehealth and in-person care while payers, by and large, resist payment parity for cost reasons.

However, Epple pointed out that there is actually more nuance to both the payer and provider views than it might appear initially. Leveraging overlapping incentives with virtual-only care providers can help payers move the conversation forward in at least one area of care.

“Brick-and-mortar providers in general are probably more likely to want payment parity or relatively close to payment parity simply because they do have likely higher input costs for running their clinics and offices, but also may be seeing the patient in person as well as virtually,” Epple said.

Providers who work primarily in-person are going to be using CPT and HCPCS codes and prices that are already well-established for their in-person services. If payers try to negotiate lower rates with in-person providers, these providers are acutely aware of how much money they are losing in contrast to their in-person rates.

Strictly virtual providers, on the other hand, may be more open to novel payment arrangements.

Platforms like Teladoc and Doctor on Demand, Epple noted, might have more flexibility to adopt compensation structures that allow for a per member per month payment rate or a subscription fee model.

Nearly every payer has leveraged this type of strategy to some degree, but Epple anticipated that those novel arrangements with virtual care providers will expand.

Setting novel payment arrangements with virtual-only care providers not only has the potential to decrease healthcare spending, but it can also function as a known expense for payers at a time when future spending is uncertain.

As payers wait to see how COVID-19 affects utilization, whether a second wave will arise, and COVID-19’s impact on premiums, at least the bill for their virtual care advanced payment model will be predictable.

Ultimately, data related to long-term telehealth usage will be the main factor that settles the reimbursement debate.

“The data is still being developed to understand what the actual cost offsets or what the right payment rate looks like for telehealth. That’s something that we’ve talked to both plans and providers a lot about,” said Epple. “If there is any silver lining to 2020 in the last six months, I do think a lot of it is going to be the fact that payers are now generating a lot of data about how their chronic care patients have access to services via telehealth.”

Thompson agreed that now is the time for payers to lean on value-based care arrangements to incentivize telehealth as an essential care delivery platform.

“If payers prefer providers that provide the full suite of support that their members are looking for, the providers will go there,” said Thompson. “The problem often isn’t that providers aren’t willing to go there, it’s that the incentives are locked in to an old way of thinking and not what the new environment could be.”

Primary care telehealth in particular would benefit from a population-based, prepaid model, Thompson noted.

“If you don’t pay on a fee-for-service basis, you make smart decisions on how to take care of patients,” he pointed out. “That empowers providers to think in a more patient-centered way about what they actually need to see that patient for, and how they can conveniently provide the care.”

This debate will likely need to be decided by the end of the year, Thompson projected. As utilization drops back to more stable levels, payers are letting their telehealth waivers expire. When those waivers are no longer in place, the conversation about reimbursement will naturally come to a crossroads and the industry will have to make a decision.

“One of the positive things about telehealth is that it’s technology-based,” Thompson added. “Technology does allow us to integrate more systematic measurement, more systematic checks and balances into the system. We should take advantage of that. There’s no reason that virtual care couldn’t be more standardized and effective care.”

While the data is still being developed regarding the actual cost benefits of more widespread telehealth utilization, as Epple indicated, there is no doubt in O’Shea’s mind that telehealth is something UnitedHealthcare members want.

In fact, during the pandemic, the nation’s favorability towards telehealth rose, particularly among seniors who, historically, have been a difficult demographic to engage with telehealth.

Over three-quarters of seniors who used telehealth said that they would do so again in the future, according to a study on behalf of Better Medicare Alliance. More than nine in ten reported that they had a positive experience.

Thus, as UnitedHealthcare follows state and federal guidelines around virtual care reimbursement and the dust settles on that subject, O’Shea said that the payer will continue to encourage member utilization of telehealth tools.

“Continuing to drive the adoption of virtual care will be aided by multiple strategies, including the use of pro-consumer health plan designs that may make this technology more affordable, convenient and simple; consistent and customized communications that may help people identify virtual care resources and take more steps to use it; and supporting care providers so they are better able to make virtual care a key part of their practices,” said O’Shea.

As payers seek to permanently integrate telehealth into their healthcare delivery strategy, solidifying what care services most benefit from telehealth and how much they should reimburse providers will be challenging but pivotal.

DATE: September 9, 2020

BAMBERG, SC—Palmetto Care Connections (PCC) Chief Executive Officer Kathy Schwarting announces that Chief Executive Officer of CareSouth Carolina, Ann Lewis and retired Director of SC Department of Mental Health John H. Magill have joined the PCC Board of Directors.

“Ann Lewis is a pioneer in her field. She has shepherded growth over the past 30 years addressing health care needs of the Pee Dee community. CareSouth Carolina now serves more than 38,000 patients and staffs over 500 employees in ten rural communities,” said Schwarting. “CareSouth Carolina has been an early provider of telehealth services in rural communities, and PCC is fortunate to have Ann’s knowledge and expertise on the board.”

Lewis has served as the Chair of the Greater Pee Dee Champion Community and on the Hartsville Rotary Club; the Coker College Board of Visitors; Darlington County Communities in Schools; Pee Dee Area Health Education Consortium; Pee Dee Alzheimer’s Association; the Children’s AIDS fund, Northeastern Rural Health Network, and many other groups.

Through CareSouth Carolina, she provides volunteer support to the American Cancer Society; American Heart Association; local chambers of commerce; downtown development associations; local agri-tourism; and was awarded the 2004 South Carolina Ambassador for Economic Development by South Carolina Commerce and the Governor, as well as numerous Volunteer of the Year awards by the organization.

On a state and national level, Lewis is the founding president of the South Carolina Rural Health Association and a former president of the South Carolina Primary Health Care Association. The National Association of Community Health Centers (NACHC) presented Ann with the 2012 John Gilbert Award, which recognizes longstanding excellence and leadership in community health. She received The Champion Award presented by the South Carolina Primary Healthcare Association in 2017 for her “extraordinary leadership, commitment and dedication to the vision and mission of community health centers.”

“PCC also welcomes John H. Magill to the board of directors,” said Schwarting. “PCC has had a long-standing partnership with SCDMH, and Mr. Magill has been an advocate of PCC’s work and a champion of telehealth for many years. After his extraordinary career in mental health, PCC is honored and privileged to have him as a board member.”

Magill retired as the SC Department of Mental Health State Director in January 2019, a position he held for 12 years. He is currently the longest serving public mental health director in the United States.

Magill began his career with the Department at the former South Carolina State Hospital in the 1960s. During his career, he served as the state of Georgia’s director for Alcohol and Drug Abuse, he was the founder and Chief Executive Officer of Fenwick Hall Hospital on Johns Island, South Carolina, and he also served as a deputy chair and Professor of Psychiatry in the Medical University of South Carolina’s Department of Psychiatry.

Magill received the Governor’s Award: The Order of the Palmetto in 2011 in recognition of his service to the citizens of South Carolina and contributions to behavioral health care. In October of 2011, the University of South Carolina’s School of Medicine honored Magill with the Dean’s Distinguished Service Award in recognition of his ongoing commitment to the School, where he remains a clinical professor of Psychiatry.

Under his leadership, SCDMH launched its nationally acclaimed Emergency Department Telepsychiatry program, which was developed to meet the critical shortage of psychiatrists in South Carolina’s underserved areas and assist hospital emergency rooms by providing appropriate treatment to persons in a psychiatric crisis. The program employs state-of-the-art telehealth technology to connect SCDMH psychiatrists to hospital emergency departments throughout the State.

Built on the success of its telepsychiatry services to emergency departments, SCDMH equipped its hospitals, mental health centers, and clinics to provide psychiatric treatment services to its patients via telepsychiatry. From 2013 – 2020, the Telepsychiatry Program has provided more than 223,000 psychiatric treatment services to SCDMH patients throughout South Carolina. SCDMH is the largest provider of telehealth services in the state.

Established in 2010, PCC is a non-profit organization that provides technology, broadband, and telehealth support services to health care providers in rural and underserved areas in S.C. PCC leads the S.C. Broadband Consortium which facilitates broadband connections for health care providers throughout the
state. PCC co-chairs the South Carolina Telehealth Alliance, along with the Medical University of South Carolina, partnering with health care organizations and providers to improve health care access and delivery for all South Carolinians.

COLUMBIA — South Carolina will soon use TV signals to enable students without high-speed internet to get and complete their virtual assignments at home, officials announced Wednesday.

The pilot program launching next month will benefit about 5,000 students in three districts: Fairfield and Jasper counties and York 1.

“We’re taking the schoolhouse to the child,” Gov. Henry McMaster said at a joint announcement with state Superintendent Molly Spearman and South Carolina Educational Television officials.

COVID-19

SC students will get Wi-Fi hot spots in time for school’s start, but gaps will remain

• By Seanna Adcox and Adam Benson [email protected] [email protected]

The technology, called datacasting, will use the state’s public airwaves to transmit encrypted data to the computers of students who either didn’t qualify for taxpayer-paid mobile hot spots or live in an area where the cellphone signal is too weak for the Wi-Fi device to do much good.

Nearly 89,000 of those hot spots, bought with federal coronavirus aid, went to households of K-12 students poor enough to qualify. By Tuesday, all 81 of South Carolina’s school districts had started the school year, mostly with a mix of in-person and online learning. But how many students statewide still lack the ability to access their schoolwork at home remains unclear.

Officials call the SCETV transmissions another short-term solution in bridging South Carolina’s digital divide until broadband is extended to every community.

“This is a piece of the puzzle that’s vital at this particular time,” said Sen. Thomas Alexander, R-Walhalla.