According to the latest details, as provided by Feedback Research Services, the estimated maximum reimbursement level for existing services from United States telemedicine programmes in 1997 amounted to a sheer $4.2 million. This is due to the fact that the medical community as well as third-party payers are not yet familiar with the new legal procedures to apply for telemedicine related reimbursement.
Several industry analysts have expressed their surprise about the low figure, since the latest developments in the medical market indicate a constantly increasing adoption of innovative telemedicine technologies in the health care sector. The Association of Telemedicine Service Providers in its annual survey stated that far more health care in 1997 was offered by means of telemedicine than ever before.
However, only few third-party payers are actively supporting this kind of new services. Physicians who engage in telemedicine-mediated consultations not necessarily are being paid via insurance or government programmes. This is a knowledge which telemedicine providers have to bear in mind. The issued eligibility criteria for reimbursement are still very restrictive. It is anticipated that The Balanced Budget Act of 1997 will change the current situation.
With this new legislation, which has come into force since January 1st 1999, Medicare reimbursement is required. Nonetheless, substantial inertia has to be overcome among third-party payers, even if the law ensures full coverage of telemedicine applications. For the near future, extrapolated figures based on total expected telemedicine services offered in 1998 and 1999, show that even in case of full payment, which is wishful thinking, the expenses will not exceed the limits of $10 million in 1999 for the major US programmes.
In California, for instance, it lasted until the second half of 1998 before the telemedicine programme administrators were ready to apply for and receive reimbursement. This only happened after the claims process, issued by the Californian Department of Health Services, had been clarified, and that was one year after the deadline for implementation. Telemedicine reimbursement forms a new and controversial issue, so the same kinds of delays are likely to occur at the federal level.