Many payers cover Telemedicine, but payments for e-visits remain in infancy

Physician Compensation Report, June, 2003

Blue Shield of California conducted a pilot test in 2002 in which the company paid providers $20 for email visits for nonurgent matters, using secure software provided by RelayHealth of Emeryville, Calif., a leading vendor in this field. Also piloting "WebVisits" were 10 large California self-insured employers in a study conducted by the University of California, Berkeley, and Stanford University. Not only did most physicians and patients report satisfaction with the process, but also the health plans reported spending overall nearly $2 per member per month less than expected on these patients.

David Joyner, senior vice president of network management at Blue Shield of California, says the firm will roll out a larger e-mail visit test program, probably this summer, before making it available to the firm's entire patient population. The company probably will pay about $25 per visit, a little above the payment to fee-for-service physicians under the pilot program, Joyner says. A more difficult problem, he adds, is how to pay large groups and independent practice associations that receive capitation from Blue Shield, because their payments to physicians vary from FFS to capitation to salary.

Blue Cross and Blue Shield of Massachusetts will run a WebVisit pilot starting this summer, also using RelayHealth's software and Web site (www.relayhealth.com), with 500 physicians. Spokeswoman Susan Leahy says the firm will pay $24 per approved visit. An algorithm or "decision tree" determines the patient's eligibility and elicits information about the presenting problem. The basic steps, Leahy says, are to determine whether:

(1) The patient is established, because new patients can't use the service.

(2) The visit is a follow-up of a previous one, because if so, the firm considers the service an unreimbursable part of the earlier visit.

(3) The inquiry is an appropriate one, meaning that it is not a question about a refill, referral, appointment, or a point of medical information, and that it concerns a nonemergency problem.

(4) The patient agrees to a copay of $5 to $15 depending on the coverage plan.

If so, the patient submits more detailed information about his or her problem. The whole routine takes the patient five to eight minutes, Leahy says. The physician must respond within 24 hours.

Large Groups Are Major Customers

Eric Zimmerman, RelayHealth senior vice president for marketing, says that about half of paid WebVisits concerns ongoing management of chronic diseases such as symptoms and medications for diabetes or heart problems. The other half concerns low-acuity conditions such as sore throats and back pain. The firm's decision tree is a "structured clinical interview" akin to the questions a doctor would ask in an office, focused on approximately 150 separate conditions, he adds.

While RelayHealth "is in talks with most major payers" in the country, especially Blues plans, about setting up e-visit programs, Zimmerman says that the firm's main customers at this point are large medical groups. The groups pay the firm about $50 per month per physician to use the WebVisit routines. About 5,000 physicians are registered under these contracts, he notes.