Iowa Governor Kim Reynolds recently signed a new bill into law requiring commercial health insurers in the Hawkeye State to cover health care services provided via telehealth to the same extent those services are covered via in-person care.  The law, passed under HF 2305, takes effect January 1, 2019 and applies to all policies delivered, issued, or reissued in Iowa after that date.  Iowa telemedicine providers, entrepreneurs, and patients will soon enjoy telehealth insurance coverage, joining the national majority of states with similar laws.

The key coverage language in the statute states, in pertinent part, as follows:

“[A] policy, contract, or plan providing for third-party payment or prepayment of health or medical expenses shall not discriminate between coverage benefits for health care services that are provided in person and the same health care services that are delivered through telehealth.”

From a healthcare provider’s perspective, the language in the Iowa law is less than ideal for clarity purposes.  It states a health plan “shall not discriminate between coverage benefits” for telehealth vs in-person services.  This reflects an implied intent to require health plans to fully cover telehealth services for an insured member if the corresponding underlying medical service is covered under that member’s benefit plan.  However, other states have elected to use more affirmative language to simply and explicitly state the coverage requirements a health plan must follow.  For example, consider the clear, succinct directive in Mississippi’s telehealth coverage law: “All health insurance and employee benefit plans in this state must provide coverage for telemedicine services to the same extent that the services would be covered if they were provided through in-person consultation.”  Such language is preferable because it gives patients, providers, and plans more clarity on what is, and is not, required to be covered under the patient’s benefit plan.

Highlights of the new law include the following:

• The statute applies to the following classes of health plans: (1) individual or group accident and sickness insurance providing coverage on an expense-incurred basis; (2) an individual or group hospital or medical service contract; (3) an individual or group HMO contract; and (4) a public employee plan. The law does not apply to accident-only, specified disease, short-term hospital or medical, hospital confinement indemnity, credit, dental, vision, Medicare supplement, long-term care, basic hospital and medical-surgical expense coverage, disability income insurance coverage, coverage issued as a supplement to liability insurance, workers’ compensation or similar insurance, or automobile medical payment insurance.
• Interactive Audio-Video Communications Required. The law limits coverage of telehealth to interactive audio and video, stating “Telehealth means the delivery of health care services through the use of interactive audio and video. Telehealth does not include the delivery of health care services through an audio-only telephone, electronic mail message, or facsimile transmission.”  This means store-and-forward and remote patient monitoring (RPM) modalities are not included in the Iowa coverage requirement.
• No Expansion of Covered Services. Most telehealth insurance coverage laws, including Iowa’s, do not expand a member’s benefit package or require health plans to cover a service delivered via telehealth unless that service is covered under the member’s benefit plan when delivered in-person.  For example,, most telehealth insurance coverage laws will not require a health plan to cover RPM, unless RPM coverage is expressly stated in the law.
• Services Must be Appropriate and Delivered in Accordance with Law and Standard Practices. Under the Iowa law, health care services delivered by telehealth must be appropriate and delivered in accordance with applicable law and generally accepted health care practices and standards prevailing at the time the health care services are provided, including all rules adopted by the appropriate professional licensing board having oversight of the health care professional providing the health care services.  The Iowa Insurance Commission is also empowered with enacting regulations necessary to administer the statutory requirements, so providers should keep an eye out for any proposed rules from the Insurance Commission.
• No Payment Parity. The Iowa statute contains no payment parity language.  In other words, unlike some states (g. Delaware, Minnesota), the Iowa law does not require health plans to pay a provider at the same or equivalent reimbursement rate that provider has contracted for with the health plan for identical in-person services.  For example, Minnesota’s payment parity law states: “A health carrier shall reimburse the distant site licensed health care provider for covered services delivered via telemedicine on the same basis and at the same rate as the health carrier would apply to those services if the services had been delivered in person by the distant site licensed health care provider.”  Payment parity is an essential issue for lawmakers to consider when drafting and evaluating a proposed telehealth coverage bill, or when revisiting a previously-enacted coverage law.  We have discussed this extensively in prior articles, and handled these issues in connection with policy and legislative drafting efforts.

The enactment of Iowa’s telehealth insurance coverage law brings the count to approximately 35 states plus the District of Columbia (D.C.) with laws requiring commercial health plans to cover telehealth services.  Further expansion in coverage and reimbursement means providers can enhance telehealth offerings, while allowing individual insured patients the ability to choose to receive medical care in-person or via telehealth.  Insurance coverage of telehealth services is supported by the AMA’s Policy for Coverage and Payment of Telemedicine Services.  Telehealth insurance coverage laws are also a consumer rights issue, helping ensure that covered members (i.e., the people who pay insurance premiums to their health plan) are able to select how to obtain their medical care, rather than being forced to obtain services in-person or pay for telemedicine services out-of-pocket as a noncovered service.