insurance coverage Archives - OF DIGITAL INTEREST

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists, and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past two weeks:

Behavioral and mental telehealth
Coverage and payment parity

A CLOSER LOOK

Proposed Legislation & Rulemaking:

In Illinois, HB 4475 gained another co-sponsor. If adopted, the bill would provide that a group or individual policy of accident and health insurance or managed care plan that is amended, delivered, issued, or renewed on or after January 1, 2025, or any third-party administrator administering the behavioral health benefits for the insurer, must cover all out-of-network medically necessary mental health and substance use benefits and services (inpatient and outpatient) as if they were in-network for purposes of cost sharing for the insured. The bill specifically provides that the insured has the right to select the provider or facility of their choice and the modality, whether the care is provided via in-person visit or telehealth, for medically necessary care. To date, the proposed legislation has passed the house chamber and committee.
In Washington, the Department of Health announced a proposed rule concerning certification standards for the new, voluntary certified peer specialist and trainee credentials created by passed SB 5555 (chapter 469, Laws of 2023) for behavioral health. The proposed rule would require a certified peer specialist who provides telehealth services to take the telehealth training as specified in WAC 246-929-340.

Finalized Legislation & Rulemaking Activity:

Missouri enacted several emergency rule amendments related to coverage under the Missouri Consolidated Health Care Plan, which provides coverage to employees and retirees of most state agencies, as well as public entities that have joined the plan. The amendments include revisions to coverage of virtual visits, non-network payments, the timing of other deposits to health savings accounts, and the right of the state plan to recoup certain deposits. Under the amendments, virtual visits offered through the vendor’s telehealth tool are covered at 100% after deductible is met unless Internal Revenue Service guidance permits them to be paid at 100% prior to deductible being met.

Why it matters:

Use of telehealth services for behavioral healthcare continues to grow. There has been a notable trend of telehealth modalities being adopted for mental health and substance abuse care. Legislative and regulatory activity is responding to this trend with increased access, as in the Illinois proposed legislation regarding telehealth coverage parity, and increased safeguards, such as the telehealth training requirements in the Washington proposed rule. This expansion of tele-behavioral health may increase access to mental health services for those in remote or underserved communities, and may increase convenience and flexibility, in turn promoting more consistent attendance and better treatment outcomes.
States are assessing the extent of insurance coverage and payment rates for telehealth services. Telehealth services continue to inspire debate regarding coverage parity (i.e., covering telehealth services to the [...]

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Data Breach Insurance: Does Your Policy Have You Covered?

Recent developments in two closely watched cases suggest that companies that experience data breaches may not be able to get insurance coverage under standard commercial general liability (CGL) policies. CGLs typically provide defense and indemnity coverage for the insured against third-party claims for personal injury, bodily injury or property damage. In the emerging area of insurance coverage for data breaches, court decisions about whether insureds can force their insurance companies to cover costs for data breaches under the broad language of CGLs have been mixed, and little appellate-level authority exists.

On May 18, 2015, the Connecticut Supreme Court unanimously affirmed a state appellate court decision that an IBM contractor was not insured under its CGL for the $6 million in losses it suffered as the result of a data breach of personal identifying information (PII) for over 500,000 IBM employees. The contractor lost computer backup tapes containing the employees’ PII in transit when the tapes fell off of a truck onto the side of the road. After the tapes fell out of the truck, an unknown party took them. There was no evidence that anyone ever accessed the data on the tapes or that the loss of the tapes caused injury to any IBM employee. Nevertheless, IBM took steps to protect its employees from potential identity theft, providing a year of credit monitoring services to the affected employees. IBM sought to recover more than $6 million dollars in costs it incurred for the identity protection services from the contractor, and negotiated a settlement with the contractor for that amount.

The contractor filed a claim under its CGL policy for the $6 million in costs it had reimbursed to IBM. The insurer refused to pay. In subsequent litigation with the contractor, the insurer made two main arguments. First, it argued that it only had the duty to defend against a “suit,” and that the negotiations between the contractor and IBM were not a “suit.” Second, the insurer argued that the loss of the tapes was not an “injury” covered by the policy.

The Connecticut Supreme Court adopted both of the insurer’s arguments, and the decision highlights two key areas for any company considering whether it needs additional insurance coverage for data breaches: what constitutes an “injury” under a CGL, and when an insurer is required to reimburse a company for costs associated with an injury. First, the court held that the loss of the computer tapes was not a “personal injury” under the CGL, because there had been no “publication” of the information stored on the tapes. In other words, because there was no evidence that anyone accessed or used the stolen PII, the court found that the data breach did not constitute a “personal injury” under the policy—even though the contractor spent millions of dollars reimbursing IBM for costs associated with the data breach.

Second, the court found that the CGL policy only required the insurer to reimburse [...]

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Trending in Telehealth: November 26 – December 10, 2024

Data Breach Insurance: Does Your Policy Have You Covered?

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