Telehealth After the Public Health Emergency: Place of Service, Audio-Only, and Licensure
A 40-clinician behavioral health group has delivered telehealth since 2020. During the public health emergency it billed psychotherapy visits with place-of-service 02 and modifier 95, and it treated audio-only visits as billable. When the emergency ended, a billing consultant advised that 'nothing changes for behavioral health.' Since then the group has reported POS 02 for every telehealth visit, including visits where the patient was sitting at home; has billed audio-only psychotherapy for 140 new-patient visits; and has used modifier 95 on every telehealth line, including audio-only sessions. Separately, a licensed clinical social worker who lives and is licensed in State A has been treating 22 patients located in State B for eight months. State B has not joined an interstate compact and has no temporary telehealth registration that covers her. The group's compliance plan calls for an annual billing audit; the last one was two years ago. A payer has now requested records for 15 of these claims.
1. Are the place-of-service and modifier choices correct? Explain the rule and the practical consequence of getting it wrong.
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No on both counts.
Place of service reports where the service was furnished. For Medicare telehealth, POS 10 is used when the patient is at home, and POS 02 is used when the patient is at a site other than home (clinic, hospital, other originating site). The temporary flexibility that let practices report 02 for home-based patients during the emergency has been extended by Congress more than once, with expiration dates that have moved; the consultant's 'nothing changes' is therefore partly true in that some flexibilities survived, but it is wrong as a blanket statement, because the extensions are time-limited and because POS and modifier accuracy are not flexibility questions. Continuing to report 02 for every home visit is a misrepresentation of where the service occurred, and payers that reimburse POS 02 differently from POS 10 will have paid incorrectly in one direction or the other.
Modifier 95 identifies a synchronous audio-video service; audio-only has its own modifier (93 for Medicare). Using 95 on audio-only lines tells the payer the encounter was video when it was not. The consequence is not just a coding nit - it defeats the payer's ability to apply its audio-only coverage rules, and it is the kind of systematic misdescription that supports a false claims theory if the misdescribed modality affected coverage. Quantify the affected claims by date of service and payer, and map each against the rules in effect on that date rather than against today's rules.
2. The 140 audio-only new-patient visits are the largest exposure. How do you assess them, and what do you do with the findings?
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Start with the payer rules in effect on each date of service, because they diverge. Medicare has allowed audio-only behavioral health under specific conditions when the patient is at home and cannot or will not use video, and its coverage of audio-only for new patients has been governed by time-limited policy that has changed. Commercial plans frequently limit audio-only to established patients, require documented patient inability or refusal to use video, or exclude it outright. A blanket practice of billing audio-only for new patients is therefore likely to be wrong for at least part of the population some of the time.
Assess in three layers: (1) modality and location documentation - does the record state the patient was at home, that the visit was audio-only, and why video was not used? (2) eligibility - was the patient new or established, and did the payer's rule on that date permit audio-only for that status? (3) consent - was telehealth consent obtained, and does it cover audio-only? Sample the 140 records, quantify the claims paid without support by payer, and treat the result as an overpayment: report and return within 60 days of identification.
Corrective action: build a telehealth billing grid by payer and effective date and review it quarterly, add required fields to the note template for patient location, modality, and reason video was not used, and stop billing audio-only for new patients unless the specific payer rule permits it.
3. Address the licensure issue and the payer's record request. What are your immediate steps?
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Licensure follows the patient, not the clinician. A clinician licensed in State A treating a patient physically located in State B is practicing in State B, and without a license, compact privilege, or valid temporary registration there, those 22 patients received services by an unlicensed provider. That is a state law problem independent of reimbursement, and it is also a reimbursement problem, because claims certifying that a covered, licensed provider furnished the service may be false, and many payer contracts require network credentialing in the state where the patient is located.
Immediate steps: stop the State B caseload, transfer the patients to a properly licensed clinician with appropriate handoff, notify leadership and counsel, and determine whether State B requires a self-report to the licensing board. Check whether any payer requires notification. Quantify the 22 patients' claims and fold them into the same overpayment analysis and 60-day timeline. Update credentialing and scheduling so that a patient's physical location is captured at intake and checked against the clinician's licensure before the first appointment.
On the record request: produce complete, unaltered records for the 15 claims. Do not add late documentation to make a record look better, and do not let anyone amend a note retroactively; a properly labeled late entry is permissible only for genuinely new information. Coordinate the response with counsel, since a false claims issue may exist, and answer within the payer's deadline or request an extension in writing. Finally, restart the annual audit this quarter - a two-year gap is why three separate problems accumulated undetected.