Published — March 22, 2011 Updated — May 19, 2014 at 12:19 pm ET

Telehealth bill aims to expand health IT access for home care providers

Sen. John Thune (R-S.D.) is co-sponsoring legislation that would provide Medicare payments for home care providers that utilize audio and video technologies.

Sponsors hope promise of revenue neutrality will improve the legislation’s chances


Home care providers in rural areas and other underserved communities may soon be eligible to receive Medicare payments for audio and video home monitoring under a Senate bill reintroduced last week after going nowhere in three recent sessions of Congress.

Sponsors John Thune, a South Dakota Republican, and Amy Klobuchar, a Minnesota Democrat, hope the fourth try will yield success for the measure to help elderly Americans remain in their homes without increasing government health costs. The legislation did not receive a floor vote in the House or Senate in previous attempts in 2005, 2007, and 2009, as other health care reform and technology measures took priority, but the bipartisan bill has generated no visible opposition. This year’s version has been referred to the Senate Finance Committee, where health IT observers believe it stands an improved chance of passage, in part because it promises to be revenue-neutral.

Proponents say the measure — the Fostering Independence Through Technology (FITT) Act — represents an unrealized 2008 presidential campaign promise by Barack Obama. Historically, home health care has involved nurses traveling to patients’ homes several times a week to monitor their condition and provide appropriate treatment. “Telehealth,” or the use of audio and video technology, allows home health agencies to monitor patients’ blood pressure, heart rate, and other vital signs to fill gaps between visits. It also allows patients to communicate with their providers remotely. Supporters say this technology will reduce hospital readmission, give patients greater independence, and improve health, by allowing senior citizens to live at home longer prior to or instead of requiring nursing home care. They also believe the monitoring technologies themselves could help reduce home health visits somewhat, saving Medicare money.

“It is not meant to replace the in-person assessment, but to supplement it,” says Rich Brennan, executive director of the Home Care Technology Association of America, and vice president of technology policy for its parent organization, the National Association for Home Care & Hospice (NAHC). The latter is the nation’s largest trade association representing the interests of home care agencies, hospices, and home care aide organizations, and has lobbied in strong support of the bill.

The legislation would create a pilot program for home care providers who use telehealth in rural and other underserved communities to receive incentive payments through Medicare. Home health care agencies that take part in the program would receive funds each year based on a percentage of the Medicare savings that result from telehealth services. The effort would be managed by the Department of Health and Human Services.

Though the Congressional Budget Office has not yet scored the legislation’s revenue implications, Greg Billings of the Drinker Biddle law firm, who lobbied in support of the measure on behalf of both the Telehealth Leadership Initiative and the NAHC, says the bill was expressly designed to be cost-neutral. “The cost savings aren’t paid out unless there are cost savings,” noted Billings. The language of the bill mandates that savings be documented before any payments will be made.

Nursing homes accounted for more than 20 percent of Medicare payments in 2009 — a total of about $28 billion, according to the Centers for Medicare & Medicaid Services. Home care is a cheaper alternative to other forms of care as it costs an average of $135 per visit, while nursing homes cost about $662 a day and a one-day stay at a hospital costs about $6,200, according to the Bureau of Labor Statistics.

“It’s a tough year in terms of spending money,” said Neal Neuberger, executive director at the Institute for e-Health Policy and chairman of the American Telemedicine Association Policy Committee. “If [the bill] gets scored as budget neutral, that helps a lot.” The fact that it has been introduced three times before also would help its passage, he said.

Though the measure could theoretically reduce nursing home Medicare receipts, the American Health Care Association, which represents the industry, says the legislation does not deeply impact its members and the group has taken no position on the bill. Indeed, lobbying disclosure forms indicate just five companies and organizations lobbied in 2010 on the legislation — each in support of the bill. Among them: the Texas Association for Home Care, the National Cable and Telecommunications Association, and the Evangelical Lutheran Good Samaritan Society.

With debate on last year’s sweeping health care reform law out of the way — and with the telehealth bill’s chief backer, Thune, now on the powerful Senate Finance Committee — advocates hope the fourth time will be the charm for the legislation. Drinker Biddle’s Billings says supporters are in a “much different position this year than last year. On top of that, with all the pressures on health care reform to integrate health care, reduce readmissions, bring down costs, we think the focus on remote monitoring will be more relevant this year than last year.”

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