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DWT advises telehealth clients on the rapidly evolving and unpredictable landscape of legal and regulatory issues that they face on a daily basis. Our support for telehealth clients involves all phases of their lifecycle from initial investment, creation of a viable product, expanding into multistate practice, and exit events. We have worked with companies of all shapes and sizes, including startups to large hospital systems, various categories of health care service providers, for profit and non-profit, domestic and foreign organizations, etc. We have deep expertise in several specific issues, which are discussed in greater detail below.

Telemedicine presents exciting new opportunities for providers to deliver medical care across state borders. However, providers must be mindful of state licensure requirements. If a physician wishes to treat an out-of-state patient via telemedicine, he or she should obtain the appropriate licensure from the state in which the patient is located. State medical and other licensing boards vary in their requirements. Some states offer special purpose licenses for telemedicine, but most states require physicians to obtain full licensure. In certain cases, exceptions to the licensure requirements exist for consultations, emergencies, on-call scenarios and other special circumstances. We help our clients understand and navigate the various state licensure requirements.

Hospitals must credential physicians who provide services to their patients through telemedicine. Previously, hospitals were required to credential practitioners as if they were onsite – resulting in credentialing by both the hospital where the practitioner usually provides services (distant-site hospital) and the hospital seeking to obtain telemedicine services for its patients (originating site hospital). In 2011, the Centers for Medicare & Medicaid Services enacted a more streamlined credentialing process for telemedicine practitioners. Hospitals whose patients are receiving telemedicine services can now rely on the credentialing and privileging decisions made by distant-site hospitals or distant-site telemedicine entities if certain conditions are met. For example, the parties must enter into a written agreement that meets several requirements. We help our clients understand and navigate the credentialing requirements.

Online Prescribing
Telemedicine practitioners that engage in online or internet prescribing – prescribing a drug to a patient based upon an interaction that has taken place via electronic or virtual platforms – face complex state law regulations that must be carefully analyzed and interpreted. Most states prohibit prescribing solely based on an internet questionnaire. Some states only permit online or internet prescribing if the provider has established a "patient-provider" relationship which may include an in-person examination of the patient. Many states limit the kind of pharmaceuticals that may be prescribed during a telemedicine encounter.

The complexity and nuance of the current regulatory environment requires telemedicine practitioners engaging in online or internet prescribing to proceed with caution. Such practitioners must consider prescribing laws in their own state as well as the states in which their patients reside.

Today, remote delivery models allow telemedicine providers to provide a spectrum of high quality health care services to patients without an in-person visit. The difficulty can be navigating the many rules and regulations required to secure commercial and government reimbursements for those telemedicine services. DWT has significant experience in advising clients how to obtain reimbursement for telemedicine services and how to adapt to changes in reimbursement requirements. DWT also keeps clients informed on new and proposed legislation that may affect their delivery of care.

Telemedicine can achieve significant cost savings which has caught the attention of payors and states. Accordingly, the push is on to increase reimbursement for telemedicine services. States are promoting the use of telemedicine in the commercial context by enacting legislation mandating that commercial payors cover telemedicine services. In 2015 alone, state lawmakers across the country introduced more than 200 telemedicine bills in all but eight states. Additionally, the federal government introduced two bills that support telemedicine services and would supersede local laws for Veterans Affairs and Medicare patient populations.

Privacy & Security
Practitioners using technology to provide health care services via electronic or virtual platforms must exercise care surrounding patient privacy and confidentiality. The potential for interception and misappropriation of confidential patient information can be significant. To address this concern, federal and state laws establish standards for the maintenance of patient medical records and protocols to protect the confidentiality of individual patient information whether in electronic form or otherwise.

When practitioners offering telemedicine services are considered a “covered entity," they will be subject to—and therefore must comply with—the HIPAA security and privacy rules. Moreover, telemedicine providers are also likely subject to a myriad of state laws related to privacy, security and other related matters.

Fraud and Abuse
Telehealth service arrangements may implicate federal and state fraud and abuse laws where parties are in a position to profit from the referral of patients or where the free or discounted items are offered to patients or referral sources. Many health care providers view telehealth as a new patient acquisition tool, and therefore consider incorporating incentives or free or discounted services as a component of their business model. These strategies, while not necessarily illegal, can create risk for the parties involved depending on the nature of the arrangement, whether federal payment programs are involved, and what state laws apply. Federal and state anti-kickback or fee-splitting laws, physician self-referral laws, patient inducement rules and other issues may all be implicated by a telehealth arrangement, and the penalties under these statutes can include criminal prosecution. We recommend close analysis of telehealth service arrangements to minimize the risk of violating these federal and state fraud and abuse standards.