Sustainability Strategies for Rural Telehealth Programs
There are several different strategies for sustaining telehealth programs that may be useful for rural
healthcare systems and providers. The Rural Community Health Toolkit also provides information about general
Strategies and Sustainability Strategies
for Specific Issues. Additional information about funding for rural telehealth projects and systems can
be found in the Telehealth Use in Rural Healthcare topic guide.
Reimbursement for Telehealth Services
Several rural telehealth programs rely on reimbursements from Medicare, Medicaid, and private
insurers to finance telehealth services.
Medicare requires the “originating site” of telehealth, which refers to the location of the Medicare
beneficiary at the time they receive telehealth services, to be a county outside of a Metropolitan Statistical
Area (MSA) or to be a rural Health Professional Shortage Area (HPSA) located in a rural census tract. The Health
Resources and Services Administration's Medicare
Telehealth Payment Eligibility Analyzer tool can help communities determine their
eligibility for Medicare reimbursements. CMS
provides guidance to clarify reimbursement policies for Medicare fee-for-service providers. CMS also
developed a booklet called Rural
Providers and Suppliers Billing.
Medicaid and private payer reimbursement rates vary widely from state to state. The Center for Connected Health
Policy monitors current
state laws and reimbursement policies and provides a report on state
telehealth laws and reimbursement practices.
When planning for long-term sustainability, rural communities should be aware of the following considerations
Parity laws at
the federal and state level determine whether telehealth visits are reimbursed at the same rate as in-person
Payers may place different restrictions on the originating site for telehealth services. Rural
programs should assess whether originating site restrictions will allow them to provide telehealth
services outside of healthcare settings, such as in patients' homes or in schools.
Payers may also limit reimbursements for certain telehealth applications. For example, some payers
may only reimburse live-video telehealth consultations, while others may also fund store-and-forward
and remote patient monitoring services.
Reimbursement restrictions on provider type also vary from state to state. Eligible providers may
include physicians, advanced practice clinicians, and other licensed healthcare workers.
The American Telemedicine Association provides a state-by-state breakdown of
and reimbursement gaps. The regional Telehealth
Resource Centers also provide information about reimbursement in specific states.
Value-Based Payment Mechanisms
Some rural communities are financing telehealth programs through value-based payment mechanisms, such
as accountable care organizations (ACOs), that value quality over volume of care. These programs seek
to use telehealth to achieve quality, outcome, and cost targets, including reductions in hospital
readmissions, lengths of stay, and transfers to larger care centers. For example, Oregon's
Organizations (CCOs) receive global budgets to integrate physical, behavioral, and dental
healthcare for members. CCOs have invested
in several telehealth initiatives to improve the health of Oregonians, including telemental
health services, remote patient monitoring, and telementoring.
Telehealth User Fees
A key feature of telehealth is connecting rural sites to remote providers and specialists. Some rural
sites contract directly with a remote provider who can offer telehealth services. Other rural
programs pay user fees to subscribe to a telehealth center, which is typically located in a larger
hospital or academic medical center. The fees to connect to these telehealth services can strain facilities with
limited budgets. Considerations for rural
programs seeking to make the case for investing in telehealth user fees include:
Staffing flexibility – Telehealth allows some rural facilities to implement less
expensive or more feasible staffing models. For example, some Critical Access Hospitals may have
difficulty recruiting qualified physicians to staff emergency departments in rural locations. These
hospitals may choose to instead recruit advanced practice nurses to staff emergency departments while
using telehealth to enable access to remote case consultations and telementoring.
Return on investment – Rural communities can consider if the return
on investment from telehealth services justifies the cost of paying for consulting fees. Factors
that may affect return on investment include increased revenue from keeping patients in the community and
billing for encounters. Programs may also consider cost reductions associated with traveling for
professional development and conducting recruitment activities.
Alignment with mission of the facility or organization – Some rural programs may
consider how telehealth allows them to work towards the mission or vision of their organization by improving
quality of care, access to care, health outcomes, or patient satisfaction.
Working with Payers and Policymakers
Some rural communities may choose to work directly with policymakers, Medicaid officials, and private
insurers to make changes to reimbursement policies and achieve long-term sustainability for their
telehealth programs. Rural programs may consider approaching insurers to determine if they can use
telehealth to achieve shared goals for improving outcomes and decreasing costs. For example, a
private health plan interested in reducing diabetes-related hospitalizations might be willing to fund
a remote patient monitoring program to improve patient self-management. The South
Carolina Telehealth Alliance encourages partners to meet with payers to offer telehealth
solutions for high-cost issues.
Rural programs may need to build relationships with state medical and pharmacy boards in
order to address additional factors that affect telehealth sustainability, including regulations for
licensure and certification. Rural programs may also consider joining or establishing coalitions in
order to mobilize diverse stakeholders to support telehealth policies.
Resources to Learn More
Barriers and Facilitators for Sustainability of
Tele‐Homecare Programs: A Systematic Review
Examines barriers and enabling factors related to sustaining tele-homecare programs for chronic
disease management in home health nursing agencies.
Author(s): Radhakrishnan, K., Xie, B., Berkley, A., & Kim, M.
Citation: Health Services Research, 51(1), 48-75
Telehealth Service Implementation Model (TSIM™):
A Framework for Telehealth Service Development,
Implementation, and Sustainability
Describes how to establish an open-access telehealth network. Discusses four stages of operational maturity with
examples from South Carolina.
Organization(s): MUSC Telehealth Center of Excellence
Consult Reimbursement Roadmap
Describes state of reimbursements for eConsults and store-and-forward services. Discusses future
opportunities for CMS and state programs to support eConsult and offers recommendations to engage
eConsult stakeholders in discussions regarding reimbursement, incentives, and pilot programs.
Organization(s): Blue Shield of California Foundation, Center for Connected Health Policy,
Facilitating Telemedicine Project
Sustainability in Medically Underserved Areas: A Healthcare Provider Participant Perspective
Describes factors affecting the long-term sustainability of teleconsultation projects from the
perspective of providers. Discusses how project design can address these factors.
Author(s): Paul, D.L. & McDaniel Jr., R.R.
Citation: BMC Health Services Research, 16, 148
Private Payer Laws: Impact and Issues
Analyzes the body of state-level telehealth reimbursement policies and the impacts on telehealth
utilization. Covers information on payment parity laws, modalities, site restrictions, Medicaid
policies, and more.
Organization(s): Center for Connected Health Policy, Milbank Memorial Fund
The State and Sustainability of
Examines the sustainability of telepsychiatry programs to identify current practices and trends.
Discusses factors contributing to successes and challenges of telepsychiatry programs.
Citation: Journal of Behavioral Health Services & Research, 43(2), 305-318