Uncertainty in Washington rattles telehealth sector

Modern Healthcare – Friday, February 21, 2025
By Brock E.W. Turner

Telehealth companies are used to an uncertain regulatory environment but the dizzying pace at which President Donald Trump’s administration has operated is causing concern about the industry’s future.

Virtual care companies are bracing for the impact from potential Medicaid rate cuts, navigating a delayed final rule regarding the remote prescribing of buprenorphine and facing a March 31 deadline for Medicare coverage flexibilities. While these stakeholders are used to reimbursement uncertainty dating back to the start of the COVID-19 pandemic, many say this time is different.

“They’re frustrated. They don’t know what to do,” said Kyle Zebley, executive director of the American Telemedicine Association’s lobbying arm, ATA Action. “They don’t understand why something so popular and so bipartisan is in this position.”

Congress has extended Medicare telehealth reimbursement flexibilities several times over the last few years. The provisions originated during President Donald Trump’s first term, which means there is optimism that a short-term extension will get passed into law by the end of March, Zebley said. Republican lawmakers have also expressed confidence Congress would extend expanded telehealth access past the looming deadline but did not rule out a lapse in coverage.

The fate of other digital health-focused rules is less certain. In January, Biden’s Drug Enforcement Administration proposed a rule that would set up a special registration process for remote prescribing of Schedule II-V controlled substances such as Xanax, Vicodin and Adderall.

On Thursday, the Alliance for Connected Care, a telehealth industry group, and 150 organizations called on U.S. Attorney General Pam Bondi to withdraw Biden’s telemedicine rule. The groups said the proposed rule would limit access to telemedicine. Waivers allowing providers to remotely prescribe controlled medications via telemedicine run through Dec. 31, 2025, which would give DEA time to alter the rules and not have an effect on these companies’ businesses.

The DEA under President Biden also released a final rule in January for its 2023 proposal that would set up a process for remote prescribing of buprenorphine, a medication used to treat opioid use disorder. Last week, the DEA delayed enforcement of this rule until March 21 and is seeking public comment.

Bicycle Health, a virtual care startup providing opioid use disorder treatments, could face challenges. Founded in 2017 with a single clinic in Redwood City, California, the company went exclusively virtual after the COVID-19 pandemic began, said founder and CEO Ankit Gupta. If the remote prescribing waivers are not extended or a special registration pathway isn’t defined by the DEA, patients may have to find a new virtual provider every six months, he said.

“We’ve been living with regulatory uncertainty since the beginning of the company,” Gupta said. “As a founder, I feel like the country is letting us down.”

Beyond remote prescribing, possible Medicaid rate cuts have also made it difficult for companies to plan ahead. Gupta said he did not rule out leaving states altogether if Medicaid rate cuts materialized.

The uncertainty is a reoccurring theme for many of these digital health companies.

“These companies are very much trying to treat patients,” said Alexandra Maulden an associate at law firm Foley & Lardner who focuses on healthcare and advises telehealth clients. “They want to comply with the requirements, but also, it’s hard to do so when [the rules] are changing and always in flux.”

Access this article at its original source.