Telehealth Reimbursement: The Rules Changed Twice This Year, and Your Billing Might Still Be Running on the Old Version
Here’s something that happened and you might have missed it. For four days in late January, Medicare’s telehealth flexibilities briefly snapped back toward pre-pandemic limits because Congress missed a funding deadline. Then on February 3, Congress passed a funding law that put everything back and extended it through December 31, 2027.
Now, did your practice touch anything during those four days? If you paused telehealth billing out of caution, or changed something to be safe, it’s worth checking whether that caution is still baked into your workflow. A lot of practices made a defensive move in January and never went back to undo it.
That’s really the pattern this year. Not one big mistake, but a bunch of small ones where the rule moved and the billing process didn’t move with it. Let’s walk through where that tends to happen.
That Two-Digit Code Is Probably Costing You Money
So, when you bill Medicare for a telehealth visit, do you know exactly where the patient was sitting? Not you, the patient. Because Medicare cares a lot about that, and CMS spells it out clearly:
- POS 10 means the patient was home. This gets you the non-facility rate.
- POS 02 means the patient was somewhere else, like a clinic or an office. This gets you the facility rate, which pays less.
Here’s the annoying part. If you bill POS 02 for a visit that should have been POS 10, nothing tells you. No denial, no rejection, no red flag. The claim just pays, quietly, but at the lower amount. CMS’s own payment directive confirms POS 10 claims get the higher non-facility rate, so if you’re defaulting to POS 02 out of habit, you’re leaving money sitting there every single time.
There’s a modifier piece too, and it trips people up. Modifier 95 goes on real-time audio-video telehealth. Modifier 93 goes on audio-only visits. It’s a newer distinction, and a lot of billing templates just never got updated to reflect it.
So what do you actually do about this?
Add one question to your check-in process. Ask the patient where they’re calling from, write it down, and make sure that answer is what decides the POS code on the claim. Not memory. Not habit. The actual answer from the patient.
Phone-Only Therapy Visits Are Billable, You Just Have to Document Them Right
A lot of behavioral health practices hear “the patient called in instead of using video” and just assume that visit can’t be billed. That’s an expensive assumption to carry around. Under that same CMS guidance, Medicare allows audio-only billing for mental health visits as long as the patient was home and either couldn’t use video or chose not to, and you’re capable of offering video if needed.
So where does this go wrong?
The note!
Most documentation templates were built with video visits in mind, and when a phone visit happens, the note gets written the same way it always is, without capturing what was different about it. When a payer looks at that claim later, they want to see three things: confirmation the patient was home, a clear statement that it was audio-only, and a short line about why video wasn’t used. Add prompts for those three things to your template, use modifier 93 instead of 95, and you’ve closed most of the risk on these claims.
You Might Be Checking the Wrong Medicaid Document
This one catches even careful billing teams off guard, so don’t feel bad if it’s news to you. Medicaid.gov is upfront that federal law doesn’t specifically address telehealth delivery, which means states get a lot of freedom to decide what’s covered, where, and at what price.
But here’s the thing most people don’t realize that the most Medicaid patients aren’t on fee-for-service. They’re on managed care. And CMS’s own Medicaid toolkit says CMS ‘encourages’ states to line up managed care telehealth coverage with the state’s own policy, but doesn’t force them to. A managed care plan can build its own telehealth rules, separate from what the state document says. So you can check the state policy, confirm a service is covered, bill it, and still get denied because the specific plan you’re billing has its own rules that don’t match.
The fix here isn’t complicated, just tedious. Check coverage at the plan level, not the state level, and check again periodically, because these contracts change.
What’s Actually Going On With Parity Laws
Let’s talk about New Jersey for a second, because the story here moved fast and it’s easy to get wrong if you’re working off an old article.
According to the version of the law on the state legislature’s site, the pay parity requirement was set to expire July 1. That deadline came and went, and the legislature acted first. The Governor’s office confirms the extension bill was signed June 30, pushing parity through December 31, 2027, and it explicitly covers audio-only behavioral health visits too.
Now, even if your state has a strong parity law, here’s a wrinkle worth knowing. Parity laws generally apply to fully insured plans. Self-funded employer plans play by different rules entirely, governed by federal ERISA law instead of your state’s insurance code. A 1975 DOL opinion, which is still the standing interpretation, confirms states can’t treat self-insured plans like regular insurers for regulation purposes. If a big chunk of your commercial patients work for large employers, there’s a decent chance those plans are self-funded and your state’s parity protection doesn’t actually reach them.
Two Changes CMS Made That Have Nothing to Do With the January Chaos
Separate from all the flexibility drama, CMS made two permanent changes in its latest fee schedule rule. According to CMS’s fact sheet:
- Frequency limits are gone for good on subsequent inpatient visits, subsequent nursing facility visits, and critical care consultations.
- Direct supervision can now happen virtually, through real-time audio-video, for a lot of services that used to require someone physically on-site.
If your billing process still caps how often you bill certain visit types, or assumes a supervisor has to be physically present, you might be leaving revenue on the table that’s tied to work your practice is already doing.
Where To Start
Here’s a practical list to work through this month:
- Pull the last 90 days of telehealth claims and compare your telehealth rates to your in-person rates for the same CPT codes, payer by payer.
- Add a patient-location question to your check-in flow so nobody’s guessing on the POS code.
- Update your behavioral health note templates to prompt for home confirmation, audio-only modality, and the reason video wasn’t used, and double check modifier 93 is going on the right claims.
- Pull the actual telehealth policy from each Medicaid managed care plan you bill, don’t just trust the state document.
- If you bill in New Jersey, make sure your records reflect the parity extension through December 2027.
- Check whether you’re still enforcing old frequency caps on visit types that no longer have them.
- Take one more look to make sure nothing from that brief January lapse is still lingering in your setup.
Most of the money lost in telehealth billing isn’t lost dramatically. It’s lost one claim at a time, slowly, because the rule changed months ago and nobody went back to update the process. Worth a look.
Divan Dave is the Founder and CEO of OmniMD, a pioneering healthcare IT company he established in 2002. With over two decades of leadership, Mr. Dave has been instrumental in transforming traditional care delivery into modern, data-driven digital health systems.