How Changes to Medicare Could Impact Digital Health

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The Centers for Medicare and Medicaid Services (CMS) is the leading government healthcare plan in the US, available to citizens over 65. As of 202, Medicare offers healthcare coverage to more than 62 million Americans. With aging Boomers reaching retirement age, an additional 19 MM people are expected to enroll in the program over the next 11 years. But this isn’t your grandfather’s Medicare, with more tech-savvy and digitally engaged seniors, the use of digital health tools is becoming an important factor in caring for the nation’s largest generation.

Covered Lives, Lower Costs

With discounted rates and reimbursements determined by the U.S. government, Medicare helps to ensure its members can continue to receive proper medical care while keeping costs low.  Medicare is one of the country’s most important social programs for seniors, as it helps to ensure that late-in-life medical costs don’t bankrupt the elderly. This is especially important when considering the health status of many Medicare members.

According to CMS, 50% of its members have five or more chronic conditions which requires extensive care coordination and management. In addition, 32% of members are under 70 which means that a large portion are still quite active and tech savvy. As more active and tech aware seniors become covered under Medicare, it presents a greater opportunity to use digital health tools to stay connected with one of the largest generations who may be aging but are also setting new records for longevity and improved health.

Recent Changes to Medicare

Over the past year there have been major changes to Medicare to try to find new ways to gain profit and cover more lives. These efforts have been expedited and amplified as a result of COVID19 as new digital health tools have enabled providers and patients to stay connected, while also abiding by new health precautions.

CMS enabled Medicare to cover more than 135 more services through telehealth and expanding coverage to more rural hospitals. The expansion of telehealth service to rural areas more than double the allowable service, greatly expanding access to high quality care. This payment model provides hospitals in rural communities with a more consistent stream of Medicare payments while also earmarking funds to expand broadband infrastructures in rural communities to support digital health efforts.

Behind the Times

Critics of CMS say the organization has been slow to adopt more advanced regulations, and lags in innovation in comparison to private health networks. At a time when 60% of Americans ages 65 and up own a smartphone, payers are thinking about new models to engage consumers who are increasingly comfortable with digital technologies. The growing Medicare population is becoming more reliant on digital health tools to help them make healthcare decisions and therefore innovation in this space must mirror the expectation of patients.

To that end, CMS launched its first digital platform in 2019, called the “What’s Covered” app.  Unfortunately, the “What’s Covered” app is no different than any other new development in the digital health space. Below are some areas where the app tries to be informative, but misses the mark in comparison to more established digital health tools:

  • Improved access to cost information. The desire for patients to access information about the costs of their medical care is evident: an estimated 63% of Americans report there is not enough information on the price tag of their medical services. In an effort to demonstrate cost transparency, the app merely shows what a hospital actually pays for a service, not necessarily what the hospital will be charging a member.
  • Pharmacy benefits. The app only shows what is covered under Medicare prescription drug plans but lacks information on how much patients will pay out-of-pocket at the retail counter. Additionally, CMS might evaluate ways in which Medisafe has connected prescription medications to cost savings, either through a GoodRx® connection or through drug manufacturers directly. The platform also helps users manage their medication treatment throughout the process, moving beyond just a PBM tool.
  • Enhance patient and family engagement.  To ensure end users feel as though the app is a meaningful resource, developers should consider qualitative research tools, such as group interviews and focus groups, to ensure patients feel engaged in how an app operates and what elements are most useful.  Input from patients and caregivers will provide valuable guidance to CMS for an enhanced version of this app.

Tech expansion

Despite its lag to adopt digital health and telehealth platforms early on, COVID19 has presented a new reality that has increased its use and acceptance in Washington. Upon expanding telehealth and digital health uses in 2020, CMS reported that nearly 1.7 million beneficiaries received telehealth services since April 2020. Six in ten seniors say they are comfortable embracing technology for medical services, and one-third use an online pharmacy. Recent policy changes at CMS support the use of permanently expanded telehealth among Medicare beneficiaries beyond the COVID-19 pandemic.

The coverage of Medicare Advantage policies may be seeing some changes come 2021 as well. Advantage plans will be increasing their telehealth services and coverages. Besides the increase in overall telehealth use and its expansion to members in rural areas, CMS is giving plans the flexibility to include telehealth providers in specific areas. Some of these specialties include cardiology, dermatology, endocrinology, gynecology, primary care, and psychiatry.

The agency is also exploring the use of digital health tools to support physician and patient engagement. In future iterations of its “What’s Covered” app, the organization says it will enable connection to online pharmacies, help engage users in their medication management, and pilot telehealth visits in select areas through the app. CMS aims to make the platform more of a destination for member engagement, and is learning from other entities on what works.

CMS also believes digital health tools and platforms may be beneficial in expanding remote patient monitoring (RPM). For 2021 CMS is proposing the expansion of RPM services now be covered and aren’t limited to existing patients.  This digital health platform will extend to patients with acute and chronic conditions.

According to CMS Administrator, Seema Verna, “CMS’s rapid changes to expand digital health are a godsend to patients and providers and allow people to be treated safely. The changes we are making will help make telehealth more widely available and are part of larger efforts to advance the health of our members.”