Published July 9, 2021

Waving Goodbye to Waivers: The Coming End to the COVID-19 Public Health Emergency

Since March 2020, federal and state agencies have waived a wide range of regulatory requirements to afford providers greater flexibility in responding to COVID-19. The Centers for Medicare & Medicaid Services’ (CMS) authority to waive certain Medicare and Medicaid requirements comes from specific provisions in the Social Security Act. This authority is tied to the declaration of a federal public health emergency (PHE) by the Secretary of the Department of Health and Human Services (HHS). Such declaration lasts 90 days but may be extended by the Secretary. 

The Secretary declared the COVID-19 PHE on January 30, 2020. To date, the declaration has been renewed five times, most recently on April 15, 2021. Back in January, the Secretary sent a letter to all governors stating the PHE will likely continue through the end of 2021, and that HHS would provide 60 days’ notice if it elected to terminate the PHE earlier. Providers, therefore, can plan for the federal waivers to remain in effect through December 31, 2021—at least until HHS announces otherwise.

The majority of states, however, already have terminated their public health emergency declarations, and waivers of state law requirements tied to these declarations are ending. This can create confusion, given the many intersections of federal and state healthcare regulation. 

The federal Medicare waivers fall into three broad categories: (1) expansion of telehealth coverage (e.g., coverage for services furnished in the beneficiary’s home), (2) expansion of hospital capacity (e.g., inpatient services furnished outside the hospital facility), and (3) reduction in administrative burden (e.g., relaxing HIPAA requirements, suspending medical necessity documentation requirements). 

Regarding Medicaid and the Children’s Health Insurance Program (CHIP), CMS has approved states’ requests for similar waivers in the form of Medicaid and CHIP disaster relief state plan amendments. As is always the case with Medicaid, each state’s waivers are unique; an up-to-date state-by-state summary is available here. 

Here’s where things start to get interesting. The CMS-approved state Medicaid program waivers remain effective through the end of the federal COVID-19 PHE, even if the state’s declaration and/or waivers of state law have expired. However, a state can request early termination of one or more of its Medicaid waivers. Thus, providers should be aware of potential changes in their states’ Medicaid coverage and requirements ahead of the end of the federal COVID-19 PHE. 

Most state law waivers—many of which are ending with the termination of state emergency declarations—concern facility and professional licensure requirements. These include waivers of state law requirements that a practitioner furnishing telehealth services to persons present in the state must be licensed in the state. (A summary of these waivers is available here.) Some states also issued emergency orders requiring telehealth reimbursement parity (i.e., requiring health plans subject to state regulation to pay the same for a service regardless of whether furnished in person or virtually). (The most reliable summary of these state law waivers we have identified is available here.)

Many commentators have opined telehealth is here to stay, even after the public health emergency has passed. But here’s what will really happen with the end of the waivers.

Commercial payers. More states are adopting permanent telehealth reimbursement parity laws. (Keep track of the current score here.) These rules, however, do not apply to self-funded health plans that are not subject to state insurance laws. Some payers that expanded telehealth coverage during the COVID-19 pandemic are now quietly rolling back this coverage. Unfortunately, there’s no definitive source for current commercial payer coverage for telehealth, as each plan and provider contract is unique.

Licensure. As emergency declarations end, more states are permanently relaxing licensure requirements for practitioners furnishing telehealth services. However, some states are resisting, concerned that out-of-state providers will unfairly compete with local practitioners. 

Medicare regulations require a practitioner furnishing telehealth services to be licensed in the state in which the beneficiary is present. CMS has waived this requirement for the duration of the federal COVID-19 PHE. Because this is a regulatory requirement—not a statutory one—CMS could in the future revise its regulations to eliminate this requirement. 

For now, the discontinuation of waivers of state licensure requirements for telehealth has created a disconnect—while Medicare rules permit the practitioner to be reimbursed for the service, state licensure laws—having reverted to pre-COVID-19 standards—prohibit the practitioner from furnishing the service in the first place.

Geography and facility restrictions. Under Section 1834(m) of the Social Security Act, Medicare only covers telehealth services for rural area beneficiaries who are physically present at a facility when the services are provided. This restriction on coverage is the reason telehealth comprised a fraction of 1% of all Medicare spending pre-pandemic. In March 2020, Congress gave CMS the authority to waive this requirement for the duration of the federal COVID-19 PHE. At the end of the PHE, these geographic and facility restrictions will return, cutting off access to telehealth services for most Medicare beneficiaries. It will take a literal act of Congress (i.e., an amendment to Section 1834(m)) to bring telehealth back. 

The one exception is telehealth services furnished for behavioral health conditions. As part of the Consolidated Appropriations Act, 2021, Congress amended Section 1834(m) to eliminate the geography and facility restrictions for this limited range of services, provided there is an initial face-to-face encounter between the practitioner and the beneficiary. However, CMS has not yet published final regulations implementing this post-pandemic expansion of Medicare coverage for telehealth services.

Approved services. Section 1834(m) also limits Medicare telehealth coverage to those specific services approved by CMS. Prior to the pandemic, CMS had listed 100 services by CPT or HCPCS code. For the federal COVID-19 PHE, CMS expanded this list of approved services significantly. CMS has announced a handful of these services will be included on the permanent list following the end of the PHE. Most of the services, however, will no longer be covered unless and until CMS elects to add them to the permanent list at a later time.

Audio-visual connection. Section 1834(m) also requires telehealth services to be furnished using audio-visual technology. In March 2020, the HHS Office for Civil Rights, the agency charged with enforcing the HIPAA Privacy and Security rules, posted a notice stating it would not impose penalties against providers for noncompliance with those rules in connection with the good faith provision of telehealth during the federal COVID-19 PHE. Following the end of the PHE, a provider will risk penalties if it does not use a HIPAA-compliant audio-visual connection to furnish telehealth services.

In response to concerns that many beneficiaries are unable to access video connections, CMS created temporary coverage for audio-only evaluation and management services. A provider furnishing telephonic services must submit claims using the codes for audio-only service as opposed to the standard evaluation and management codes. Again, this coverage will expire with the federal COVID-19 PHE, unless CMS elects to continue coverage at a later date. 

Waiver of co-insurance. Also in March 2020, the HHS Office of Inspector General (OIG) published a notice that it would not pursue enforcement action against any provider that waived Medicare beneficiary co-insurance associated with telehealth services. The OIG reserved the right to terminate this notice at any time, but presumably, it will continue through the end of the federal COVID-19 PHE. After that time, however, providers will again be required to make a good faith effort to collect co-insurance for telehealth services.   

While the post-pandemic return-to-normal is generally a good thing, one area in which to expect headaches is the unwinding of procedures and practices based on regulatory leeway. Providers and their compliance professionals should be preparing now for this eventuality rather than risk future non-compliance.   

If you have questions related to waivers and regulatory compliance or need assistance in preparing for the eventual unwinding of PHE procedures, visit our COVID-19 hub, or contact a PYA executive below at (800) 270-9629.

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