DATE: April 11, 2025 at 12:34PM
SOURCE: PsychBilling Coach by Susan Frager
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TITLE: Telehealth Confusion, version 2025

URL: https://psychbillingcoach.com/telehealth-confusion-2025/

Just what we all wanted for 2025: more telehealth confusion and crazy rules to worry about! I’m surprised I haven’t come across this before, but it came up in a consultation, so I thought everyone should be made aware.

Situation: Therapist is enrolled in Original Medicare, but the client has Medicare “Advantage.” (that should really be DISADVANTAGE…) The therapist doesn’t participate with the Dis-Advantage plan.

The “Advantage” plan has out of network benefits and pays the therapist at the full Original Medicare reimbursement rate. So far, so good. But then the client is seen via telehealth. The plan denies, stating that there are no out of network benefits for telehealth. The therapist appeals, and the appeal fails, with no additional information given beyond “telehealth isn’t covered for out of network.”

What the…??? Can they do that?

My first reaction was “no, of course not. If they have out of network benefits that should apply to telehealth as well as in-person visits.” And I began my usual forceful dispute letter to the higher-ups.

But remember, we’re talking about Medicare here. A government program where everything -including telehealth is set out in federal law. So when in doubt, I go back to CMS and the statutes, looking for “where is it written that…”

And I stumbled upon this. (Click the image to be taken to the full statute).

It seems to come down to the definition of “basic benefits” as opposed to “supplemental benefits.”

Reading through the mind-numbing, confusing legalese, it appears that basic benefits under Medicare “Advantage” are defined as the same benefits a client would receive if they’d stayed with Original Medicare. The Advantage plans have to cover basic benefits.

Supplemental benefits are the extra goodies that entice people to sign up for “Advantage” plans. You know, the stuff aging celebrities push on TV. Silver Sneakers, free over-the-counter meds, hearing aids, dental & vision benefits, etc.

What does this have to do with telehealth?

It comes down to how an “Advantage” plan classifies the telehealth benefits: basic or supplemental. If telehealth is basic, it will be covered no matter the network status of the clinician (assuming the plan has out of network benefits to begin with). If telehealth is supplemental, the plan gets to decide what to offer or IF they’ll offer it.

And how would we ever find out how the plan defines the telehealth benefits?

That’s really the question! I don’t think you could. I’m certain customer service reps 1) can’t access that level of fine-print information and 2) wouldn’t even understand why you needed to know. You’d spend hours on hold verifying benefits, and in the end not be able to rely upon what you were told. No thanks, right?!

But Original Medicare covers telehealth for mental health!

Yes, it does. And that’s why it originally seemed to me that if you’re out of network with your client’s “Advantage” plan, it should still cover telehealth.

But here’s what I think is going on. Back in the days of the dinosaurs, 2019 (pre-COVID), Medicare only covered telehealth in unusual circumstances.

• The client either had to live in a rural area, or the therapist was in a designated health professional shortage area.
•

• Telehealth with the client located in their home had to be based on the client’s inability to travel. For instance, a disability or medical condition rendering them homebound. Otherwise, the client had to be at a medical facility to receive telehealth services.* (that sounds so archaic now!)
•

• Only a small number of services were covered via telehealth, and for a limited period of time in most cases.
•

• Audio-only wasn’t ever covered.
•

*This is why so much of the original telehealth confusion due to COVID occurred. At the start of the pandemic, telehealth automatically was paid at a lower, facility fee. There wasn’t a way to get the same reimbursement rate for telehealth as for in-person services. When COVID hit, Medicare implemented a “temporary” payment override by using a coding workaround during the public health emergency. In 2020, I don’t think anyone expected that this “temporary” override would last 4 years!

The introduction of Place of Service (POS) 10 allowed Medicare a way to pay full fees for telehealth, while still paying reduced rates when the client receives telehealth while sitting at a medical facility (POS 02).

This, therefore, is what I believe to be the basis of Telehealth Confusion, version 2025: In the years since 2020, Medicare law with respect to telehealth reimbursement was only amended insofar as Original Medicare was concerned. Medicare Advantage has been allowed to do their own thing, much of the time and this is by no means just limited to telehealth!

The legalese seems to support this telehealth confusion hypothesis. A couple of paragraphs below what I quoted above, is this lovely clear sentence:

Inquiring minds want to know! So I clicked the link for section 422.135. It’s entitled “Additional Telehealth Benefits.” I was excited, thinking I might finally be getting somewhere.

Clear as mud, right? So I took a detour to read through section 1834(m). To spare us all Torture by Statute, I won’t provide any quotes. It was a dead end. Just the old pre-COVID rules of Medicare telehealth. And it said nothing about Medicare Advantage. Or Disadvantage (as the case may be). Hence my hypothesis.

I’ll insert a caution: not being a Medicare attorney, this is as far as I’m going to go because reading this stuff makes my head hurt! But it’s as good a guess as any, unless you’d like to pay a lawyer.

The takeaway here is that because Medicare “Advantage” still appears to be operating under 2019’s telehealth confusion, not 2025’s, is that therapists who are out of network with commercial Medicare Part C (Advantage) plans need to be careful if doing telehealth. There may not be out of network telehealth coverage even if there are out of network benefits for in-person psychotherapy. Crazy though that sounds, it does appear to be true.

So what do I do if it happens to me?

I’ll start with one thing NOT to do. If you’re out of network with an “Advantage” plan, do not appeal. Why? Because the government has this brilliant law that says OON providers with an Advantage plan must sign a waiver of liability before the plan will consider the appeal. The waiver says that if the appeal goes against you and the plan upholds the denial, you won’t bill the patient.

Don’t go there. I get that the intent of the law was to protect elderly beneficiaries. But the outcome…

Nothing like outright giving insurance companies permission to deny!

Since you presumably explained your out of network status, if this happens, bill the client. And let the client appeal. They chose to see you, knowing that you were out of network.

Another obvious, though unfortunate, suggestion is to see Medicare Advantage clients in-person only.

If you’re currently seeing Advantage clients out of network and getting paid: then don’t worry. So far, I’ve only encountered this one example. So it’s hardly a trend. But that’s the worry: if one plan can do this and get away with it…then others will may follow suit eventually.

Because they’re always looking for ways not to pay!

Such are the rabbit trails I follow, when trying to get therapists paid. Or at least clarifying insurance messes such as telehealth confusion.

Need help? Schedule your practice’s consultation here!

URL: https://psychbillingcoach.com/telehealth-confusion-2025/

Articles can be found by scrolling down the page at https://psychbillingcoach.com/billing-blog/ under the title "The Billing Blog".

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