Digital Health Adoption Varied Among Insurers, Study Finds

A recent study conducted Manatt Health for the American Medical Association (AMA) has revealed inconsistent adoption of digital health among commercial insurers, Medicaid, and Medicare. While Medicare and Medicare Advantage plans cover all 21 digital medicine services assessed, private health plans in the commercial market do not offer the same coverage. Medicaid coverage is more limited but has been expanding over time.

The lack of commercial coverage for digital medicine services has become a roadblock to affordable access for more than half of the U.S. population with private health insurance. This lack of coverage hinders the realization of the full potential of the hybridized care model that combines in-person and digitally enabled care.

To assess coverage policies, the study looked at the CPT codes of 21 digital medicine services, including remote physiologic monitoring, remote therapeutic monitoring, electronic consultations, and electronic visits. While traditional Medicare and Medicare Advantage plans provide coverage for these codes, commercial plans exhibit inconsistent adoption. Some plans have additional restrictions beyond what is required Medicare.

Most commercial payers cover remote physiologic monitoring, but coverage for electronic consults and electronic visits is less consistent. Inconsistent coverage, along with varying levels of transparency, prevents patients and physicians from making informed decisions.

The study also found that physician use of digital health is low, primarily due to barriers to adoption. Physicians must evaluate the accuracy and reliability of the technology provided to patients in order to be paid for physiologic monitoring and remote therapeutic monitoring. The inconsistent coverage also discourages physicians from investing in the necessary infrastructure to effectively use remote monitoring.

Furthermore, the study identified that health plans often partner directly with technology companies to provide digital health services, but these services are not always connected with patients’ primary care physicians.

Despite coverage challenges and lowered investments, digital health continues to drive the future of healthcare. In the first half of 2023, U.S. digital health startups raised $6.1 billion across 244 deals. Medicaid is considered one of the more promising areas for digital health, with 80% of respondents in a survey reporting the use of telemedicine as Medicaid enrollees. Some digital health startups are focusing on underserved patient communities, such as women, children, or individuals with substance use disorders.

In conclusion, the study highlights the need to address barriers and inconsistencies in insurance coverage policies for digital health. Clear and consistent coverage guidelines are essential for the continued progress and realization of digital health’s promising potential.

Sources:

– Manatt Health for the American Medical Association (AMA)
– The Center for Connected Health Policy
– Rock Health’s 2022 Consumer Adoption of Digital Health survey
– Rock Health (startups data)