TRICARE Coverage and Payment for Certain Services in Response to the COVID-19 Pandemic

Citation85 FR 27921
Record Number2020-10042
Published date12 May 2020
SectionRules and Regulations
CourtDefense Department
Federal Register, Volume 85 Issue 92 (Tuesday, May 12, 2020)
[Federal Register Volume 85, Number 92 (Tuesday, May 12, 2020)]
                [Rules and Regulations]
                [Pages 27921-27927]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-10042]
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                DEPARTMENT OF DEFENSE
                Office of the Secretary
                32 CFR Part 199
                [Docket ID: DOD-2020-HA-0040]
                RIN 0720-AB81
                TRICARE Coverage and Payment for Certain Services in Response to
                the COVID-19 Pandemic
                AGENCY: Office of the Secretary, Department of Defense.
                ACTION: Interim final rule with request for comments.
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                SUMMARY: The Assistant Secretary of Defense for Health Affairs
                (ASD(HA)) issues this interim final rule with comment to: Provide an
                exception to the prohibition on telephone, audio-only telehealth
                services; to authorize reimbursement for interstate or international
                practice by TRICARE-authorized providers when such authority is
                consistent with governing state, federal, or host nation licensing
                requirements; and to eliminate copayments and cost-shares for
                telehealth services. The changes in this rule will be effective for the
                period of the coronavirus 2019 (COVID-19) pandemic. These changes will
                reduce the spread of COVID-19 among TRICARE beneficiaries by
                incentivizing use of telehealth services, and will aid providers in
                caring for TRICARE beneficiaries by temporarily waiving some licensure
                requirements.
                DATES: Effective date: This interim final rule is effective on May 12,
                2020 through the end of the President's national emergency
                (Proclamation 9994 of March 13, 2020 (85 FR 15337)) . ASD(HA) will
                publish a document announcing the expiration date. See the
                SUPPLEMENTARY INFORMATION section for more information.
                 Comment date: Comments are invited and must be submitted on or
                before June 11, 2020.
                ADDRESSES: You may submit comments, identified by docket number and/or
                Regulation Identification Number (RIN) number and title, by any of the
                following methods:
                 Federal Rulemaking Portal: http://www.regulations.gov.
                Follow the instructions for submitting comments.
                 Mail: DoD cannot receive written comments at this time due
                to the COVID-19 pandemic. Comments should be sent electronically to the
                docket listed above.
                 Instructions: All submissions received must include the agency name
                and docket number or RIN for this Federal Register document. The
                general policy for comments and other submissions from members of the
                public is to make these submissions available for public viewing on the
                internet at http://www.regulations.gov as they are received without
                change, including any personal identifiers or contact information.
                FOR FURTHER INFORMATION CONTACT: Major Zachary Rumery, Defense Health
                Agency, 703-681-0053, zachary.r.rumery.mil@mail.mil">zachary.r.rumery.mil@mail.mil; Amber Butterfield,
                Defense Health Agency, 303-676-3565,
                [[Page 27922]]
                [email protected]; Erica Ferron, Defense Health Agency,
                303-676-3626, [email protected].
                SUPPLEMENTARY INFORMATION:
                Expiration Date of the Interim Final Rule
                 Unless extended after consideration of submitted comments, this
                interim final rule will cease to be in effect upon termination of the
                President's declared national emergency, in accordance with applicable
                law and regulation (e.g., 50 U.S.C. 1622(a)). Because TRICARE operates
                both in the United States and in overseas locations, the ASD(HA), or
                designee, may determine that it is appropriate to continue exemptions
                to permanent regulation provisions for some or all of TRICARE's
                overseas locations serviced by the TRICARE Overseas Program contractor
                under 32 CFR 199.1(b) beyond termination of the President's declared
                national emergency based on the status of COVID-19 community spread in
                those locations. Such continuation of these provisions for overseas
                locations will be published in TRICARE's implementing instructions
                (TRICARE manuals), available at http://manuals.health.mil.
                 If the ASD(HA) determines it would be appropriate to make these
                changes permanent, the ASD(HA) will follow-up with final rulemaking.
                I. Executive Summary
                A. Purpose of the Interim Final Rule
                 A novel coronavirus (SARS-CoV-2), which causes Coronavirus Disease
                2019 (COVID-19), was first detected in December 2019 and has spread
                rapidly throughout the world. On January 31, 2020, the Secretary of
                Health and Human Services determined that a public health emergency
                existed since 27 January, 2020.\1\ On March 13, 2020, the President
                declared a national emergency due to COVID-19. Proclamation 9994 of
                March 13, 2020, titled ``Declaring a National Emergency Concerning the
                Novel Coronavirus Disease (COVID-19) Outbreak'' published in the
                Federal Register on March 18, 2020 (85 FR 15337-15338). This
                proclamation is available at https://www.govinfo.gov/content/pkg/FR-2020-03-18/pdf/2020-05794.pdf. According to WHO data on March 25, 2020,
                there were 416,686 cases of COVID-19 worldwide (18,589 deaths), with
                51,914 in the United States (673 deaths), with the number of cases
                rapidly expanding each day. Medical experts from the National Institute
                of Allergy and Infectious Disease anticipate more cases in the United
                States and overseas in the coming months.\2\
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                 \1\ https://www.phe.gov/emergency/news/healthactions/phe/Pages/2019-nCoV.aspx.
                 \2\ https://www.niaid.nih.gov/news-events/covid-19-reminder-challenge-emerging-infectious-diseases.
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                 In light of the rapid spread of COVID-19, the Centers for Disease
                Control and Prevention (CDC) has urged Americans to work and engage in
                schooling from home whenever possible as well as to avoid congregating
                in groups. Various States (e.g., Washington, New York) and various
                cities (e.g., Los Angeles) have imposed more rigid restrictions on
                gatherings requiring many businesses to restrict or close their
                operations, all to prevent further spread of the disease.
                 Pursuant to the President's emergency declaration and as a result
                of the worldwide COVID-19 pandemic, the ASD(HA) hereby modifies the
                following regulations, but in each case, only to the extent necessary,
                as determined by the Director, Defense Health Agency (DHA), to
                encourage social distancing and prevent the spread of COVID-19 by
                incentivizing the use of telehealth services, and to allow TRICARE-
                authorized providers to care for TRICARE beneficiaries wherever there
                is need as a result of the consequences of the COVID-19 pandemic. The
                following regulations are temporarily modified:
                 a. 32 CFR 199.4(g)(52) Telephone Services: Existing regulations
                exclude TRICARE coverage of telephone services (audio-only) except for
                biotelemetry. Given the current CDC guidelines for social distancing
                and some states' governors' orders for residents to stay at home, it is
                imperative that an exception to the regulatory exclusion be permitted
                to allow TRICARE-authorized providers to render medically necessary
                care and treatment to beneficiaries over the telephone, when in-person
                treatment is not required. Telephone calls of an administrative nature
                (e.g., appointment scheduling) are not medical services and are not
                reimbursable. The exception to the exclusion is warranted now during
                the COVID-19 pandemic and the DoD may follow up with final rulemaking
                to make the removal of the exclusion a permanent change in Program
                regulations, if appropriate, after a thorough review of costs,
                benefits, risks, patient privacy, and other considerations. However,
                while the DoD conducts this review, it is prudent to permit telephone
                services more expansively during this emergency period. This change
                will apply to all geographic areas where TRICARE beneficiaries reside.
                 b. 32 CFR 199.6(c)(2) Conditions of authorization--(i) Professional
                license requirement: Existing regulations require TRICARE-authorized
                providers to be licensed in the state where practicing, even if such a
                license is optional. Anticipating that practitioners may be asked to
                surge to areas of high medical need, the federal government (through
                the Department of Health and Human Services (HHS)) and some states
                (e.g., California, Florida, Louisiana) have proposed suspending
                interstate license requirements or otherwise making it easier for
                providers to treat patients beyond the state where the provider holds a
                license. If the federal or state government permits providers to
                operate within a jurisdiction without obtaining a license in that
                state, TRICARE would be unable to cost-share services provided to in-
                state beneficiaries by out-of-state licensed providers due to the
                existing regulatory licensure requirements. For telehealth, the
                provider license requirement has long been interpreted to mean that the
                provider must be licensed in the state where practicing and in the
                state where the beneficiary resides. This regulation change would allow
                for reimbursement of an otherwise-authorized TRICARE provider if, under
                applicable federal or state law, that individual holds an equivalent
                license from any state in the United States, complies with any
                provisions for interstate practice in that state, and is not
                affirmatively barred or restricted from practicing in any state in the
                United States. This change does not supplant state authority to
                regulate licensure, but assures that if licensure requirements are
                relaxed by any state or the federal government during the period of the
                COVID-19 pandemic, that providers caring for TRICARE beneficiaries in
                compliance with state or federal law will be eligible for reimbursement
                under TRICARE.
                 Implementing this regulatory change resolves an issue of particular
                concern where TRICARE has military installations near the border
                between states and patients may have their primary care or other
                regular provider based in another state (e.g., the patient lives in
                Kentucky but sees a mental health professional in Virginia). Without
                this change, the provider would not be able to be reimbursed for
                services provided to that beneficiary via telehealth unless the
                provider was also licensed in the adjoining state.
                 Services provided to TRICARE beneficiaries overseas would be
                eligible for reimbursement when performed by a provider outside of the
                nation in which they are licensed and normally practice if allowed by
                the host country in which
                [[Page 27923]]
                they are practicing and so long as they hold an equivalent licensure in
                the nation in which they normally provide services. The provider would
                be required to meet all requirements for practice under the host
                nation.
                 Providers listed on the HHS sanction list are ineligible to receive
                reimbursement under the TRICARE program, and would remain ineligible
                under this provision.
                 c. 32 CFR 199.17(l)(3) Special cost-sharing rules: Existing
                regulations require copayments and cost-sharing for telehealth services
                to be the same as if the service was provided in person. TRICARE's
                cost-shares and copayments are set by law. However, Section 718(d) of
                the National Defense Authorization Act of 2017 authorized the Secretary
                of Defense to reduce or eliminate copayments or cost-shares when deemed
                appropriate for covered beneficiaries in connection with the receipt of
                telehealth services under TRICARE. Given the current environment where
                community-spread of COVID-19 is evident and the CDC has recommended
                social distancing, we find it appropriate to remove copayments and
                cost-shares for TRICARE Prime and Select beneficiaries utilizing
                telehealth services provided by network providers as a necessary
                incentive to prevent further spread of COVID-19 during this emergency.
                The waiving of copayments and cost-shares (including deductibles) for
                in-network telehealth services will apply to all otherwise-covered
                services delivered via telehealth, not just those related to COVID-19,
                and will apply to all TRICARE beneficiaries in all geographic regions
                for the duration of this emergency. TRICARE program rules still apply,
                for example, TRICARE Prime beneficiaries must have a referral from
                their Primary Care Manager (PCM) for a specialty care visit, however,
                under this rule modification, both the PCM visit and the specialty care
                visit (if performed via in-network telehealth) have no cost-share or
                copay. There are no changes to cost-shares and copays for ancillary
                services, durable medical equipment, prescriptions, or other referrals
                or care that are ordered due to or result from the telehealth service.
                 d. Dates: These modifications will become effective on May 12, 2020
                and will cease to be in effect upon termination of the President's
                declared national emergency. With TRICARE beneficiaries located
                worldwide, the ASD(HA), or designee, may allow the provisions of this
                interim final rule (IFR) to continue after termination of the
                President's national emergency for some or all of TRICARE's overseas
                locations based on the status of COVID-19 community transmission in
                those locations. Such continuation of these provisions for overseas
                locations will be published in TRICARE's implementing instructions
                (TRICARE manuals), available at http://manuals.health.mil.
                 Certain provisions of this IFR may be made permanent (e.g., the
                elimination of the audio-only telehealth exclusion) while others are
                anticipated to be removed when the COVID-19 pandemic has concluded
                (e.g., waiver of telehealth cost-shares and licensure of authorized
                providers). The DoD may issue a final rule to make permanent changes.
                B. Interim Final Rule Justification
                 Agency rulemaking is governed by section 553 of the Administrative
                Procedure Act (APA), 5 U.S.C. 551 et seq.. Section 553(b) requires
                that, unless the rule falls within one of the enumerated exemptions,
                the DoD must publish a notice of proposed rulemaking in the Federal
                Register that provides interested persons an opportunity to submit
                written data, views, or arguments, prior to finalization of regulatory
                requirements. Section 553(b)(B) of the APA authorizes a department or
                agency to dispense with the prior notice and opportunity for public
                comment requirement when the agency, for ``good cause,'' finds that
                notice and public comment thereon are impracticable, unnecessary, or
                contrary to the public interest. Section 553(d)(3) requires that an
                agency must include an explanation of such good cause with the
                publication of the new rule.
                 As noted in this preamble, the United States, as well as numerous
                other countries, have taken unprecedented measures to try to contain or
                slow the spread of COVID-19. The CDC has recommended that individuals
                remain at home unless their occupations are essential, e.g., health
                care workers, and various states and locales have instituted more
                stringent requirements discouraging travel. As a result, ensuring that
                patients receive testing and care as warranted will require robust
                telehealth (including audio-only services) and coverage of providers
                rendering services in different locations from where they are licensed.
                 Given the national emergency caused by COVID-19, it would be
                impracticable and contrary to the public health--and, by extension, the
                public interest--to delay these implementing regulations until a full
                public notice-and-comment process is completed.
                 Pursuant to 5 U.S.C. 553(b)(B), and for the reasons stated in this
                preamble, the ASD(HA), therefore, concludes that there is good cause to
                dispense with prior public notice and the opportunity to comment on
                this rule before finalizing this rule. For the same reasons, the
                ASD(HA) has determined, consistent with section 553(d) of the APA, that
                there is good cause to make this IFR effective immediately upon
                publication in the Federal Register.
                C. Summary of Major Provisions of the Interim Final Rule
                 This provision, 32 CFR 199.4(g)(52) currently excludes telephone
                services when they are audio-only. However, biotelemetry for patient
                monitoring and synchronous two-way audio interactions that are enhanced
                with video or similar kinds of data transmissions are covered under the
                TRICARE Program. This IFR temporarily revises the regulation to provide
                an exception to the prohibition for telephonic services (audio-only)
                for the duration of the COVID-19 pandemic. The exception to the
                prohibition is warranted now during the pandemic to permit
                beneficiaries to have their symptoms (which include COVID-19 symptoms,
                or symptoms of other covered illness or injury) evaluated by a provider
                over the telephone before, or in lieu of, obtaining an in-person
                appointment; which may ultimately not be necessary. This practice
                supports containment of the disease and decreases the opportunity for
                exposing others.
                 Consistent with existing TRICARE policy, all audio-only telehealth
                encounters must be medically necessary, appropriate, and be rendered by
                a TRICARE-authorized provider acting within the scope of their
                licensure, as defined by TRICARE statute, regulation, and policy. This
                regulatory modification does not expand the services available to
                TRICARE beneficiaries; instead, it makes otherwise-covered services,
                when rendered via telephone (audio-only), eligible for reimbursement
                and cost-sharing when care is medically necessary and appropriate, and
                meets all other provisions of TRICARE policy. While existing telehealth
                platforms that incorporate both audio and video/visual two-way
                communication is preferred, there may be instances when this is not
                possible within the context of this public health emergency. For
                example, a rural provider may not have access to broadband capability,
                or a beneficiary may not have in-home technology to support two-way
                audio/video communication. For the purposes of this public health
                emergency, and to support clinical guidelines regarding social
                distancing, audio-only visits (if appropriate) are an acceptable
                [[Page 27924]]
                alternative to other, preferred, telehealth platforms. The rendering
                provider will be expected to utilize their judgment of clinical
                necessity, within their licensure and scope of practice, to
                differentiate services provided via audio and video (traditional
                telehealth platforms) or audio-only services. The use of audio-only
                telehealth should be for the purpose of providing assessment,
                diagnosis, clinical care, or formal patient education from an
                authorized provider to a patient, or for providing clinical
                consultation between providers that directly impacts upon a particular
                patient's care. The authorized provider should determine that a phone
                call is appropriate for accomplishing the clinical goals of the
                encounter and document appropriately. If the decision to provide care
                via a traditional audio/visual method is chosen, the reasons for that
                decision should be documented as well. For recurring care, the
                rationale for choosing audio-only or audio and visual should be
                documented only at the initiation of remote care, or upon any change in
                modality.
                 Care that normally requires a physical examination (including a
                remote physical examination requiring a tele-presenter such as a nurse)
                is not appropriate for audio-only telehealth encounters. Administrative
                services (for example, making appointments or verifying prescriptions)
                are not separately reimbursed services. Following publication of this
                IFR, the agency will provide additional parameters and policy regarding
                audio-only telehealth encounters in the implementing instructions
                consistent with this IFR and other provisions of TRICARE policy.
                 The Agency may follow up with final rulemaking to make the removal
                of the exclusion for telephonic services (audio-only) a permanent
                change in Program regulation, if appropriate, after a thorough review
                of costs, benefits, risks, patient privacy, and other considerations.
                However, while the agency conducts this review, it is prudent to permit
                telephone services more expansively during this emergency period. This
                temporary change will apply to all geographic areas where TRICARE
                beneficiaries reside.
                 This provision, 32 CFR 199.6(c)(2)(i), requires providers to be
                licensed in the state in which they practice when such a license is
                offered, even if such a license is not required. The requirement has
                not changed over the years; however, the global pandemic has created a
                situation where flexibility is required in order to allow providers to
                (1) deliver care in areas of need without the additional time and cost
                of re-licensure, when permitted by state and federal law, and (2)
                provide services via telehealth to beneficiaries wherever they are
                located. This temporary rule change will make it easier for TRICARE
                beneficiaries to access telehealth services, and will ensure providers
                are able to treat beneficiaries in areas of high need without worrying
                about not being reimbursed for doing so. Nothing in TRICARE's provision
                supplants the authority of states to manage the licensing of providers
                in their jurisdictions, and this modification would only apply in those
                areas that have opted to relax interstate licensing requirements or
                where the Federal Government has preempted state licensing
                requirements. In doing so, it would ensure that providers continue to
                be reimbursed during the highly-fluid global pandemic. It will still
                require providers to have an equivalent license in any state, to meet
                the requirements for the state where they are practicing, and forbid
                reimbursement of services by a provider who is affirmatively barred or
                restricted from practice in any state.
                 This modification would also apply to providers treating
                beneficiaries outside of the United States by allowing the provider to
                practice in a nation other than the one in which they are licensed and
                normally provide services so long as the host nation permits such
                practice and the provider is not on the HHS sanctions list. The ability
                of the provider to practice in the host nation remains the province of
                the host nation; this modification would ensure that services provided
                within the licensure requirements of the host nation would be
                reimbursable under TRICARE.
                 This provision, 32 CFR 199.17(l)(3), delineates requirements for
                cost-shares and copayments under the TRICARE program. This IFR would
                amend the regulation to add a new provision waiving cost-shares and
                copayments (including deductibles) for all in-network authorized
                telehealth services for the duration of the COVID-19 pandemic (ending
                when the President's state of emergency declaration is suspended or
                terminated, in accordance with applicable law and regulation). This
                will incentivize TRICARE beneficiaries to utilize telehealth services
                and avoid unnecessary in-person TRICARE-authorized provider visits,
                which could potentially bring them into contact with or inadvertently
                aid in the spread of COVID-19. This will apply to TRICARE Prime and
                Select beneficiaries in all geographic areas.
                D. Legal Authority for This Program
                 This rule is issued under 10 U.S.C. 1073(a)(2) giving authority and
                responsibility to the Secretary of Defense to administer the TRICARE
                program. The text of 10 U.S.C. chapter 55 can be found at https://manuals.health.mil/.
                II. Regulatory History
                 Each of the sections being modified by this rule are revised every
                few years to ensure requirements continue to align with the evolving
                health care field. Title 32 CFR Section 199.4 was most recently updated
                on September 29, 2017, with an IFR (82 Federal Register (FR) 45438)
                that implemented the Congressionally-mandated TRICARE Select benefit
                plan. Its revision to 32 CFR 199.4 included the addition of medically
                necessary foods as a benefit under the TRICARE Basic Program. No
                revisions have been made to the telehealth services paragraph being
                revised by this IFR, Sec. 199.4(g)(52), in at least 20 years.
                 The most recent update to 32 CFR 199.6 was on March 17, 2020 (85 FR
                15061), which added physical therapist assistants and occupational
                therapy assistants as TRICARE-authorized providers. Six hundred eighty-
                one comments, none of which were substantial, were received on the
                proposed rule associated with that change, and all were resolved in the
                final rule. The particular provision being modified by this IFR
                regarding provider licensure, Section 199.6(c)(2)(i) is a long-standing
                requirement of the TRICARE program, and has not been revised in over 20
                years.
                 Title 32 CFR Section 199.17 was last revised on February 15, 2019
                (84 FR 4333), as part of the final rule implementing the TRICARE Select
                benefit plan. The revisions to Section 199.17 included adding high-
                value services as a benefit under the TRICARE program, as well as
                copayment requirements for Group B beneficiaries. The 32 CFR 199.17(l)
                paragraph being modified by this IFR was created as part of the IFR
                that established the TRICARE Select benefit (82 FR 45438) during which
                a comprehensive revision of Section 199.17 occurred. This paragraph did
                not exist prior to that revision and has not been modified since.
                III. Regulatory Analysis
                A. Regulatory Planning and Review
                a. Executive Orders
                Executive Order 12866, ``Regulatory Planning and Review'' and Executive
                Order 13563, ``Improving Regulation and Regulatory Review''
                 Executive Orders 13563 and 12866 direct agencies to assess all
                costs and benefits of available regulatory
                [[Page 27925]]
                alternatives and, if regulation is necessary, to select regulatory
                approaches that maximize net benefits (including potential economic,
                environmental, public health and safety effects, distributive impacts,
                and equity). Executive Order 13563 emphasizes the importance of
                quantifying both costs and benefits, of reducing costs, of harmonizing
                rules, and of promoting flexibility. Accordingly, the rule has been
                reviewed by the Office of Management and Budget (OMB) under the
                requirements of these Executive Orders. This rule has been designated a
                ``significant regulatory action,'' and determined to be not
                economically significant, under section 3(f) of Executive Order 12866.
                This rule is not expected to have a significant impact on the economy;
                however, the urgency of the change due to the global pandemic makes it
                a significant regulatory action.
                b. Summary
                 The modifications to Section 199.4(g)(52) in this IFR will allow
                TRICARE beneficiaries to obtain telephonic (audio) office visits with
                TRICARE-authorized providers for otherwise-covered, medically necessary
                care and treatment and allow reimbursement to those providers during
                the COVID-19 pandemic. It provides an exception to the regulatory
                exclusion prohibiting audio-only telephone services.
                 The modifications to Section 199.6(c)(2)(i) in this IFR will allow
                providers to be reimbursed for interstate practice, both in person and
                via telehealth, during the global pandemic so long as the provider
                meets the requirements for practicing in that state or under federal
                law. It removes the requirement that the provider must be licensed in
                the state where practicing, even if that license is optional. For
                providers overseas, this will allow providers, both in person and via
                telehealth, to practice outside of the nation where licensed when
                permitted by the host nation.
                 The modifications to Section 199.17(l)(3) will remove cost-shares
                and copayments for telehealth services for TRICARE Prime and Select
                beneficiaries utilizing telehealth services with an in-network,
                TRICARE-authorized provider during the global pandemic. It adds in-
                network telehealth services as a special cost-sharing rule to waive the
                beneficiary copay.
                c. Affected Population
                 This rule impacts all 9.5 million TRICARE beneficiaries, TRICARE-
                authorized providers, the TRICARE Program, and its contractors, both in
                the United States and overseas. TRICARE beneficiaries will be impacted
                through increased access to telehealth services and to providers who
                might surge to help with areas of high medical need. Providers will be
                impacted by being able to provide services in any state or nation that
                allows them to do so without risking loss of reimbursement for those
                services. TRICARE's health care contractors will be impacted by being
                required to implement the provisions of this regulatory change. While
                states will not be directly impacted by this change, this change will
                support efforts by states to ensure enough providers are available to
                provide services to TRICARE beneficiaries within their jurisdictions
                when those states relax licensing requirements for interstate practice.
                d. Costs
                 The cost estimates related to the changes discussed in this IFR
                include health care and administrative costs to the government and
                beneficiary cost impact. The duration of the COVID-19 emergency is
                uncertain, therefore estimated three-, six-, and nine-month scenarios
                for the impact of this IFR are presented.
                Health Care Costs Associated With Removing Copays for Telehealth
                 There are three factors that would increase DoD health care costs
                due to this rule. First, the government would lose cost-sharing revenue
                paid by beneficiaries on the existing level of telehealth visits.
                Second, there would be induced demand costs, as removal of patient
                costs will increase patient demand for these services. Finally, there
                would be a substitution effect, as the COVID-19 pandemic and removal of
                telehealth cost-shares would encourage a shift from in-person visits,
                for which beneficiaries would pay a copay, to telehealth visits, which
                would be free to beneficiaries. The estimated direct loss of copay
                revenue is estimated at: $156,949.00 for three-month waiver;
                $313,897.00 for six months; and $470,846.00 for nine months. The
                projected induced demand due to zero cost-sharing for telehealth
                visits, (relative to existing utilization) per 3 months is estimated at
                $117,772.00. Regarding the estimated cost associated with the
                substitution effect, see Table 1. Assumed Shifts of Historical Visits
                from In-Person to Telehealth.
                 Table 1--Assumed Shifts of Historical Visits From In-Person to Telehealth
                ----------------------------------------------------------------------------------------------------------------
                 Non-preventive
                 primary care and Mental health (%) Government cost
                 urgent care (%) increase
                ----------------------------------------------------------------------------------------------------------------
                During months 1-3...................................... 25 90 $26,673,895
                During months 4-6...................................... 20 75 21,937,107
                During months 7-9...................................... 10 67 16,848,793
                 3-month scenario overall........................... 25 90 26,673,895
                 6-month scenario overall........................... 23 83 48,611,002
                 9-month scenario overall........................... 18 77 65,459,795
                ----------------------------------------------------------------------------------------------------------------
                Administrative Costs
                 The estimated total contractor start-up administrative costs to
                implement this change is approximately $67,000. This includes a one-
                time change to the contractors' claims processing systems and education
                of network providers.
                Combined Health Care and Administrative Costs
                 Table 2 provides a summary of the combined government health care
                and administrative costs of the IFR.
                [[Page 27926]]
                 Table 2--Summary of Government Costs of the Proposed COVID-19 Telehealth IFR
                ----------------------------------------------------------------------------------------------------------------
                 3-month 6-month 9-month
                 scenario scenario scenario
                ----------------------------------------------------------------------------------------------------------------
                Government Health care Cost (HC):
                 Loss of copays on existing telehealth....................... $156,949 $313,897 $470,846
                 Induced demand.............................................. 117,772 235,544 353,316
                 Loss of copays on in-person shifting to Telehealth.......... 26,673,895 48,611,002 65,459,795
                 Subtotal, Government HC cost................................ 26,948,616 49,160,443 66,283,957
                Start-up administrative cost.................................... 67,494 67,494 67,494
                 -----------------------------------------------
                 Total Government Cost increase.......................... 27,016,110 49,227,937 66,351,451
                ----------------------------------------------------------------------------------------------------------------
                Beneficiary Cost Impact
                 There are two types of savings for beneficiaries estimated here.
                First, beneficiaries would avoid the cost-sharing they otherwise would
                have paid on existing telehealth visits and on in-person visits that
                would shift to telehealth. It is estimated the cost-sharing savings to
                beneficiaries would be: $26,830,844.00 for a three-month scenario;
                $48,924,899.00 for a six-month scenario; and $65,930,641.00 for a nine-
                month scenario. Second, for the share of historical visits that is
                estimated would shift from in-person to telehealth, beneficiaries would
                avoid travel time and time spent in the provider's waiting room. Two
                parameters were considered in developing the estimate of the value of
                time saved for TRICARE beneficiaries: (1) The average amount of time
                saved per visit, and (2) a monetized estimate of the value of the time
                saved, based on the opportunity cost of that time. We estimated that
                beneficiaries would save an average of 60 minutes per visit for avoided
                travel and time waiting at the provider's office. We converted this
                average time saved per visit to a monetized value to the beneficiary at
                $20 per hour as the average after-tax wage rate. See Table 3 Estimated
                Value to Beneficiaries for the combined results of avoided cost-sharing
                and dollar value of saved time.
                 Table 3--Estimated Value to Beneficiaries
                ----------------------------------------------------------------------------------------------------------------
                 3-month 6-month 9-month
                 scenario scenario scenario
                ----------------------------------------------------------------------------------------------------------------
                Avoided cost-sharing............................................ $26,830,844 $48,924,899 $65,930,641
                Dollar value of time saved...................................... 17,085,995 31,089,668 41,384,466
                 -----------------------------------------------
                 Total estimated value to beneficiaries...................... 43,916,839 80,014,567 107,315,107
                ----------------------------------------------------------------------------------------------------------------
                 Another important value to beneficiaries that is not feasible to
                estimate but worth noting is the possibility that shifting visits from
                in-person to telehealth might reduce the risk of COVID-19 exposure,
                with all the potential benefits that could accompany that reduced
                exposure risk. This reduced risk of COVID-19 exposure will likely
                result in downstream reductions in costs to the TRICARE Program in
                avoided COVID-19 diagnostics and treatment, although it is also not
                feasible to estimate these cost savings.
                e. Benefits
                 This change will have a positive impact on beneficiaries by
                incentivizing the use of telehealth while reducing their cost to do so.
                This change will have a positive impact on providers, who will be able
                to serve TRICARE beneficiaries where they are and increase their
                ability to reach beneficiaries through telehealth. Further, this change
                will have a positive societal impact by inducing demand for telehealth
                services and reducing the number of TRICARE beneficiaries seeking in-
                person health care services and potentially reducing the spread of
                COVID-19. Finally, though we are unable to quantify, the Department may
                have some reduced costs due to reduced spread and exposure of TRICARE
                beneficiaries to COVID-19, partially offsetting some of the costs
                associated with expansion of benefits and copayment waivers.
                f. Alternatives
                 The DoD considered several alternatives to this IFR. The first
                alternative involved taking no action. Although this alternative would
                be the most cost neutral for DHA, it was rejected as not addressing the
                urgent medical needs of the beneficiary population in response to the
                COVID-19 pandemic.
                 The second alternative DoD considered was to only apply the
                regulatory modifications to COVID-19-related diagnoses. This was
                rejected because the effects of the COVID-19 pandemic are causing
                stress on the entire health care system. The regulatory modifications
                in this IFR will take the pressure off of the health care system by:
                (1) Covering telephonic office visits with a TRICARE-authorized
                provider and thereby supporting social distancing recommendations; (2)
                covering TRICARE-authorized providers practicing across state lines,
                thereby increasing the overall access to medical care and treatment;
                and (3) waiving all copayments for in-network telehealth services for
                TRICARE Prime and Select beneficiaries, thereby removing the potential
                cost barrier to obtaining medical services remotely and inducing demand
                for these services, reducing potential person-to-person transmission of
                COVID-19 during medical appointments.
                B. Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. 601)
                 The Department of Defense certifies that this IFR is not subject to
                the Regulatory Flexibility Act (5 U.S.C. 601) because it would not, if
                promulgated, have a significant economic impact on a substantial number
                of small entities. Therefore, the Regulatory Flexibility Act, as
                amended, does not require us to prepare a regulatory flexibility
                analysis.
                C. Congressional Review Act
                 Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
                the Office of Information and Regulatory Affairs
                [[Page 27927]]
                designated this rule as not a major rule, as defined by 5 U.S.C.
                804(2).
                D. Sec. 202, Public Law 104-4, ``Unfunded Mandates Reform Act''
                 Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) (2
                U.S.C. 1532) requires agencies to assess anticipated costs and benefits
                before issuing any rule whose mandates require spending in any one year
                of $100 million in 1995 dollars, updated annually for inflation. This
                IFR will not mandate any requirements for State, local, or tribal
                governments, nor will it affect private sector costs.
                E. Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter
                35)
                 It has been determined that 32 CFR part 199 does not impose
                reporting or recordkeeping requirements under the Paperwork Reduction
                Act of 1995.
                F. Executive Order 13132, ``Federalism''
                 Executive Order 13132 establishes certain requirements that an
                agency must meet when it promulgates a proposed rule (and subsequent
                final rule) that imposes substantial direct requirement costs on State
                and local governments, preempts State law, or otherwise has Federalism
                implications. This IFR will not have a substantial effect on State and
                local governments.
                List of Subjects in 32 CFR Part 199
                 Administrative practice and procedure, Claims, Fraud, Health care,
                Health insurance, Individuals with disabilities, Mental health
                programs, and Military personnel.
                 Accordingly, 32 CFR part 199 is amended to read as follows:
                PART 199--CIVILIAN HEALTH AND MEDICAL PROGRAM OF THE UNIFORMED
                SERVICES (CHAMPUS)
                0
                1. The authority citation for part 199 continues to read as follows:
                 Authority: 5 U.S.C. 301; 10 U.S.C. chapter 55.
                0
                2. Section 199.4 is amended by revising paragraph (g)(52) to read as
                follows:
                Sec. 199.4 Basic program benefits.
                * * * * *
                 (g) * * *
                 (52) Telephone services. Services or advice rendered by telephone
                are excluded, except that: (i) Telephone services (audio-only) are not
                excluded when otherwise covered TRICARE services are provided to a
                beneficiary through this modality during the coronavirus 2019 (COVID-
                19) public health national emergency, if the services are medically
                necessary and appropriate, and
                 (ii) A diagnostic or monitoring procedure which incorporates
                electronic transmission of data or remote detection and measurement of
                a condition, activity, or function (biotelemetry) is not excluded when:
                 (A) The procedure without electronic transmission of data or
                biotelemetry is otherwise an explicit or derived benefit of this
                section;
                 (B) The addition of electronic transmission of data or biotelemetry
                to the procedure is found by the Director, CHAMPUS, or designee, to be
                medically necessary and appropriate medical care which usually improves
                the efficiency of the management of a clinical condition in defined
                circumstances; and
                 (C) The each data transmission or biotelemetry devices incorporated
                into a procedure that is otherwise an explicit or derived benefit of
                this section, has been classified by the U.S. Food and Drug
                Administration, either separately or as a part of a system, for
                consistent use with the defined circumstances in paragraph (g)(52)(ii)
                of this section.
                * * * * *
                0
                3. Section 199.6 is amended by revising paragraph (c)(2)(i) to read as
                follows:
                Sec. 199.6 TRICARE-authorized providers.
                * * * * *
                 (c) * * *
                 (2) * * *
                 (i) Professional license requirement. The individual must be
                currently licensed to render professional health care services in each
                state in which the individual renders services to CHAMPUS
                beneficiaries. Such license is required when a specific state provides,
                but does not require, license for a specific category of individual
                professional provider. The license must be at full clinical practice
                level to meet this requirement. A temporary license at the full
                clinical practice level is acceptable. During the period of national
                emergency for the global coronavirus 2019 (COVID-19) pandemic, a
                license is not required in the United States for each state in which
                the provider practices, so long as the provider holds an equivalent
                license in another state, the state in which the provider is practicing
                permits such practice under its interstate licensing requirements or
                the state licensing requirements have been preempted by Federal law,
                and the provider is not affirmatively barred or restricted from
                practicing in any state. During the COVID-19 pandemic, providers
                overseas are not required to be licensed in each nation in which the
                provider operates, so long as the provider holds an equivalent license
                in another nation, the host nation permits such practice under its
                licensing requirements, and the provider is not on the Department of
                Health and Human Services sanction list.
                * * * * *
                0
                4. Amend Sec. 199.17 by:
                0
                a. Redesignating paragraph (l)(3)(A) and (B) as (l)(3)(i) and (ii).
                0
                b. Adding paragraph (l)(3)(iii).
                0
                c. Redesignating paragraphs (l)(4)(A) and (B) as (l)(4)(i) and (ii).
                 The addition reads as follows:
                Sec. 199.17 TRICARE program.
                * * * * *
                 (l) * * *
                 (3) * * *
                 (iii) Cost-sharing and copayments (including deductibles) shall be
                waived for in-network telehealth services during the national emergency
                for the global coronavirus 2019 (COVID-19) pandemic.
                * * * * *
                 Dated: May 6, 2020.
                Morgan E. Park,
                Alternate OSD Federal Register Liaison Officer, Department of Defense.
                [FR Doc. 2020-10042 Filed 5-8-20; 4:15 pm]
                 BILLING CODE 5001-06-P
                

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