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The reassignment riddle: Billing Medicare for distant site services

Sean T. Sullivan (sean.sullivan@alston.com) is a Senior Associate at Alston & Bird LLP in Atlanta, GA.

Can physicians who provide the professional component of telemedicine services reassign their Medicare billing rights to a hospital? I have heard this question countless times from compliance officers, operational managers, and healthcare attorneys alike, yet the telehealth industry seems to be moving toward such billing models.

This question often arises in two different contexts. In the first scenario, the hospital serves as the originating site, and the hospital bills both for the originating site facility fee and for the distant site professional services (which the physician has reassigned to the hospital). The originating site hospital then reimburses the physician, either as an employee or an independent contractor. In the second scenario, the hospital employs or contracts with specialist physicians and serves as a hub. Those specialists are located at the hub hospital, and deliver telehealth services to rural originating sites. The distant site hub hospital submits reassigned claims to payers, and reimburses the physicians providing those professional services. This is known as the “hub and spoke” model.

Both of these are common telehealth billing models. There are already plenty of regulatory and compliance considerations in developing telehealth arrangements (see sidebar), but are there any extra concerns when these models are employed for Medicare payable services?

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