What Lawmakers Talked About during the HHS FY23 Budget Hearings

Xavier Becerra made the rounds on Capitol Hill recently in his capacity as Secretary of Health and Human Services (HHS) to testify on the Biden administration’s Fiscal Year (FY) 2023 budget request for HHS.  Beyond the secretary’s submitted testimony – which was virtually the same for every hearing – here is a countdown of the top five health-related topics on lawmakers’ minds that were discussed across seven congressional hearings on the HHS budget request.

5. Ending the PHE

In a few hearings, lawmakers questioned Becerra on when the administration plans to unwind the COVID-19 public health emergency (PHE), which is currently set to expire on July 16, 2022.  Each and every time, Becerra reiterated the administration’s commitment to providing 60 days’ before ending the PHE in order to give states and health care providers time to prepare.  In recent weeks, the administration has given no indication that it will simply let the current PHE expire in two months.  Since May 16, 2022 marked exactly 60 days before the current PHE expiration date, the administration is all but certain to renew the PHE for another 90-day period come July.

4. Telehealth Waivers

One reason why lawmakers are so interested in how long the PHE will last is because several emergency health care flexibilities are tied to the end of the PHE.  These flexibilities include several Medicare telehealth waivers that waive geographic site originating requirements and allow coverage of audio-only services, among other items.  During the hearings, Becerra repeatedly thanked lawmakers extending temporary telehealth waivers for 151 days – 5 months –  beyond the end of the PHE in the Fiscal Year (FY) 2022 omnibus

Members were also strongly supportive of extending at least some of the telehealth waivers permanently. Some of the telehealth benefits lawmakers cited include increased access to health care in rural areas and relief for the health care workforce shortage.  Becerra voiced agreements on telehealth’s many benefits during the hearings, and he urged lawmakers to work with the administration on developing legislation to make the temporary telehealth authorities permanent.  Fortunately, members are already hard at work and a bipartisan group of House members have already introduced legislation to permanently expand coverage of audio-only telehealth and remove geographic restrictions on originating sites.

3. No Surprises Act

Members from both parties across multiple committees criticized the secretary for not following congressional intent in implementing the No Surprises Act because the rulemaking process establishes the Qualifying Payment Amount (QPA) as the presumptive out-of-network rate in the independent dispute resolution (IDR) process.  They argued that doing so tips the scale in favor of insurers during the IDR process. During the hearing, authors of the No Surprises Act like House Ways and Means Committee Chairman Richard Neal (D-MA) said members went to great lengths to ensure that the legislation established a level playing for all factors to be considered in the IDR process.   

In February 2022, a district court ruling struck down provisions of the No Surprises Act that gave weight to the QPA.  Becerra assured members during the hearings that the administration’s final rule on the No Surprises Act will heed the court’s ruling, although he declined to provide a timeline  on when  the rule will be released.  The secretary also said that HHS is working with the Department of Justice (DOJ) on whether to appeal or accept the ruling.  Additionally, Becerra was confident that the new rule will protect patients from surprise medical bills. 

2. 988 Suicide Hotline

988 will officially become the new suicide hotline on July 16, 2022, and members were curious to see how the administration is ensuring the hotline will work from day one.  States and territories will be responsible for operating the actual hotline, and Becerra explained that the administration is providing states with funding to make sure they can onboard enough counselors and behavioral health professionals to take incoming calls.  In the event that existing state call centers are overwhelmed, Becerra told lawmakers that HHS is working to set-up back-up call centers.  As the launch date approaches, Becerra assured the congressional committees that HHS is “keeping tabs” with states on call center preparation, although he noted that some states will be in a better position than others to take calls right away once the new hotline goes live this summer.

1. ARPA-H

The FY 2022 omnibus established the Advanced Research Projects Agency for Health (ARPA-H) as the newest biomedical research agency within HHS.  While members were unanimous in their support of the new agency, some including Reps. Rosa DeLauro (D-CT) and Anna Eshoo (D-CA) were critical of the administration’s decision to house ARPA-H within the organizational structure of the National Institutes of Health (NIH).  DeLauro, Eshoo, and others had been advocating for ARPA-H to be an independent agency within HHS because they felt this arrangement would help cultivate an independent culture within the new agency that would best facilitate the development of new cures.  Additionally, some members including Sen. Jerry Moran (R-KS) and Rep. Tom Cole (R-OK) were concerned that the administration’s was proposing additional FY 2023 funding for ARPA-H at the expense of additional funding for existing research projects at NIH.

Becerra assured lawmakers that the placement of ARPA-H was purely administrative, and he explained that having NIH assume functions like accounting and human resources would allow ARPA-H to focus on developing breakthroughs from the get-go.  To further point to the new agency’s independence, he said the ARPA-H director would report to the secretary – not the NIH director – and he added that ARPA-H would not be “physically housed” within the NIH campus. 

Becerra additionally told the congressional panels that ARPA-H will be operational once a director is appointed.  While the secretary said the search for a director is currently underway, he was unable to provide a timeline. 

The Uncertain Future for Telehealth

April 16, 2022.  That’s the date the current public health emergency (PHE) is set to expire.  The Department of Health and Human Services (HHS) initially promised to provide 60 days’ notice to states and health care organizations before ending the PHE.  However, the Biden administration has been mum on its plans regarding the PHE and has given no indication on whether they will extend the PHE again, leaving stakeholders in doubt as to what will happen to the many temporary health policies that are tied to the PHE.

Background: HHS declared a PHE for the COVID-19 pandemic on January 31, 2020.  Since then, the PHE has been renewed by HHS eight times in 90-day increments with the most recent renewal being on January 14, 2022.my

The conversation over whether to renew the PHE couldn’t be timelier, as a growing number of federal and state officials have been discussing plans to loosen COVID-19 restrictions as the US shifts to treating COVID-19 as an endemic than a pandemic.  For example, Dr. Anthony Fauci, Chief Medical Advisor to the President, recently commented that the US is exiting the “full-blow” pandemic phase of the COVID-19 crisis, and a number of blue states and cities have begun to announce plans to roll-back certain pandemic requirements like indoor masking.  Additionally, over 70 Republican members of Congressman sent a letter to HHS Secretary Xavier Becerra last week requesting for a concrete timeline on when the PHE will come to an end. 

However, ending the PHE is no simple matter.  That’s because numerous temporary policies related to telehealth, COVID-19 treatments and vaccines, and Medicaid are specifically tied to the PHE.  In this blog post, we’ll focus on telehealth, while COVID-19 treatments and Medicaid will be covered in future installments. 

The CARES Act notably expanded Medicare coverage of telehealth services to make it easier for beneficiaries to access health care services while minimizing the exposure to COVID-19.  These temporary changes include:

  • Waiving Medicare’s geographic site originating requirement to allow beneficiaries to access telehealth in all settings.
  • Allowing audiologists, physical therapists, occupational therapists, speech-language pathologists, and other providers to provide telehealth services under Medicare.
  • Coverage of telehealth services conducted through audio-only technology like telephones and audio-visual technology like smartphone in more instances.
  • Reimbursement of 238 telehealth services, compared to 202 prior to the PHE.
  • Coverage of telehealth services without a pre-existing doctor-patient relationship.

However, all these temporary changes and waivers will expire once the PHE ends.  While members of Congress have put forth multiple legislative proposals to extend Medicare’s temporary telehealth provisions beyond the PHE, few have gained traction.  Adding to the uncertainty is the administration’s lack of communication on whether to renew the PHE another 90 days leaving both providers and beneficiaries in limbo over the status of temporary telehealth flexibilities.   

That’s why stakeholders are pushing for the PHE to stick around after April.  On February 10, the Federal of American Hospitals sent a letter to HHS requesting that the PHE be extended “well beyond” its current expiration date in two months’ time.  FAH argued that an abrupt end to PHE-authorized operations like telehealth run the risk of “destabilizing fragile health care networks” as these temporary measures have been in place for about two years allowing for patients to rely on their care.

And over the course of the past two years, telehealth usage has surged to the point that it now plays a vital role in the way people access health care.  According to HHS, telehealth utilization saw a 63-fold increase in 2020.  The adoption of telehealth in behavioral health was particularly noticeable, which saw about a third of its visits done remotely in 2020.  While telehealth usage has declined somewhat since 2020 and outpatient visits have returned to pre-pandemic levels, overall telehealth utilization remains elevated compared to 2019 levels, and patients and providers don’t  want to give up this health care tool that benefited so many patients.    

Where Are We at with Medicare’s Temporary Telehealth Waivers?

Telehealth usage has exploded during the COVID-19 pandemic, thanks to legislation like the CARES Act that expanded Medicare coverage of telehealth services to make it easier for beneficiaries to access health care services while minimizing their exposure to COVID-19.  Now that the final stage of the pandemic is (hopefully) winding down, what are the implications for telehealth? 

It’s all about the PHE.  Expanded telehealth coverage is set to expire at the end of the COVID-19 public health emergency (PHE), which is currently January 16, 2021.  The Secretary of the Health and Human Services (HHS) has the authority to renew the PHE for 90-day increments, meaning the PHE could potentially extend through April 2022 – or longer.  Below are key Medicare telehealth coverage restrictions and rules that have been waived for the duration of the PHE.

  • Qualifying Technology: Medicare may now cover telehealth services conducted through devices like smartphones that offer audio-visual capabilities and can be used to facilitate two-way, real-time communication between a beneficiary and a practitioner.  Previously, this was limited to beneficiaries in rural areas.  Additionally, the requirement for visual capabilities is now waived for certain services, meaning some beneficiaries can now use audio-only telehealth services.
  • Geographic Location: Medicare will reimburse for telehealth services anywhere in the US, with no pre-existing patient relationship required.
  • Qualifying Service: Medicare can reimburse 238 telehealth services, compared to 101 prior to the PHE. 
  • Qualifying Originating Site Type: Telehealth services can be provided to all patients in all settings, including at a beneficiary’s home.
  • Qualifying Site Practitioner: Any health care practitioner who can bill Medicare may now furnish Medicare telehealth service.

All of these temporary changes expire once the PHE ends, but Congress could take action and can change that. Lawmakers from both parties have been pushing to take some of these temporary telehealth coverage extensions and make them permanent, beyond the PHE. 

  • Several bills (S. 368, S. 1988, H.R. 341, H.R. 1332, and H.R. 5425) would strike Medicare’s geographic site originating requirement and allow Medicare beneficiaries to access telehealth services in all settings. 
  • Another (H.R. 2168) would permanently allow audiologists, physical therapists, occupational therapists, speech-language pathologists, and other providers to provide telehealth services under Medicare.
  • Additional bills (H.R. 5425 and S. 1988) would ensure permanent Medicare coverage of certain telehealth services using audio-only technology.

However, none of these have bills have advanced in either chamber since their introduction, and the Build Back Better Act, Democrats’ social spending and climate package, does not contain any provisions that address Medicare coverage of telehealth services.

It would be amiss not to highlight a major barrier to continued telehealth coverage is reimbursement.  Under the PHE, telehealth services are reimbursed under Medicare at the same rate as in-person services, and lawmakers and stakeholders disagree over whether permanently expanded telehealth services should be reimbursed at or below the level of in-person services. 

So, what does the future hold for telehealth?  In summer and fall 2020, more than a quarter of Medicare beneficiaries used telehealth services, representing a massive increase in telehealth utilization since before the pandemic.  Given that the waiver of Medicare’s telehealth restrictions will expire once the PHE ends, the question of what telehealth coverage will look like post-pandemic looms large.  The numerous proposals on Capitol Hill to expand certain telehealth flexibilities suggest lawmakers want to ensure beneficiaries have continued access to telehealth services.  However, absent any serious progress on these proposals, Medicare beneficiaries are still staring down the very real possibility of losing popular, safe, and convenient ways to access medical treatment that they gained in the early days of the pandemic.   

Should Payment Parity for Telehealth Continue?

In response to the COVID-19 pandemic, the Centers for Medicare and Medicaid Services issued rulemaking to require Medicare to pay the same rates for telehealth and in-person care for the duration of the public health emergency (PHE).  Now that the end of the pandemic may be in sight, stakeholders are debating whether Medicare should continue offering payment parity for telehealth services post-pandemic.  Since Medicare’s actions often inform what private payers do, stakeholders will be watching closely what the agency decides to do. 

Against Payment Parity

A chief argument against payment parity is that it could lead to overutilization and higher spending.  For patients with the right technology, accessing telehealth can be very convenient, leading health experts to suggest some patients may use telehealth more than necessary.  Corollary to this, some experts are worried about telehealth’s potential to create more opportunities for waste, fraud, and abuse.

Additionally, opponents to payment parity contend that telehealth requires fewer resources and less clinical effort than in-person visits.  For example, a 2017 study from Health Affairs found the average cost of a telehealth visit for an acute respiratory infection was $79 compared to $146 for in-person visits.  Simple virtual check-ins may also require less decision-making, time, and other factors considered “clinical effort” when compared to in-person appointments. 

Furthermore, some worry payment parity in telehealth may propagate low-value care.  For certain conditions, telehealth may prove limiting for providers, and there is no substitute for the type of evaluation physicians can provide through in-person visits.  Parity opponents argue that higher reimbursement rates tied to in-person visits will ensure patients can more regularly receive a full evaluation, thus preventing the likelihood symptoms missed during telehealth visits progress to become more expensive chronic conditions down the road.

For Payment Parity

Those in favor of continuing payment parity post PHE say there is no evidence that telehealth has resulted in overutilization.  Most instances of telehealth usage, parity proponents say, has been to substitute in-person to visits as a result of the COVID-19 pandemic.  According to data from electronic health record company Epic, the number of telehealth visits declined rapidly by summer 2020 following an initial increase in April 2020.  This data suggests that patients are so far not opting for more telehealth visits over in-person visits out of ease or convenience.  Additionally, some physicians argue some diagnoses can require as much clinical effort as in-person visits.  According to a 2020 study from the University of Michigan, surgeons reported spending more time on telehealth than in-person visits.   

Proponents of payment parity also say telehealth services utilize far more resources than patients realize.  While telehealth may not seem to require the same “brick and mortar costs” as in-person visits, providers assert that telehealth requires an investment in technology, both to set-up virtual visits and keep up with changes in technology.  For certain medical conditions, digital monitoring and home-based care products may require additional resources.  Providers also say that some diagnoses can involve just as must clinical effort as do in-person appointments.

Moreover, parity supporters contend that clinical guidelines about when telehealth and in-person care is appropriate can prevent low-value care.  For instance, the American College of Obstetricians and Gynecologists has issued guidance on when patients should require a physical examination. 

What Happens Next?

CMS can continue to pay the same rates or the agency could propose a differential payment rate.  Either way, the decision would be subject to the rulemaking with notice and comment.  For the part of Congress, the legislative branch hasn’t weighed in.  While legislators have introduced a slew of bills to permanently expand telehealth coverage and abolish pre-pandemic restrictions on telehealth, none address how telehealth should be paid for.  A lone exception is H.R. 8308, the Telehealth Coverage and Payment Parity Act.  Introduced by Rep. Dean Phillips (D-MN) in September 2020, the legislation would require commercial insurers to pay the same level for the same level for telehealth services as it would for in-person services.  However, this legislation does not affect Medicare, and as of this writing, the bill has yet to be reintroduced in the 118th Congress.

In their January 2021 public meeting, the members of the Medicare Payment Advisory Commission (MedPAC) suggested that Medicare continue telehealth payment parity for 1-2 years following the end of the PHE as a “pilot program” to evaluate how to telehealth services should be reimbursed permanently.  However, MedPAC’s comments have yet to be taken up in any legislative proposal.

The PHE Was Just Extended. What Does That Mean?

So, what exactly happens to those regulatory flexibilities and emergency measures when the pandemic ends?  On April 15, the Department of Health and Human Services (HHS) extended the PHE for a 90-day period beginning on April 21 and ending on July 19.  HHS won’t keep doing this forever – so what happens when the PHE is no longer renewed? 

The PHE So Far

HHS first declared the COVID-19 PHE on January 27, 2020, and HHS has since renewed the PHE four times, each for 90 days.  When Acting Health and Human Services Secretary Norris Cochran  sent a letter to state governors on January 21, 2021 estimating  the PHE will likely remain in place for the entirety of 2021,” many thought the current extension would run through the calendar year, but Secretary Xavier Becerra extended the PHE through July 19, following the pattern of 90-day renewals as stipulated by the Public Health Service Act.  The January 2021 letter indicated that when HHS decides to terminate the declaration and/or let the PHE expire, the Department will provide states with 60 days’ notice. 

When Will the PHE End?

Do you remember when President George W. Bush relayed the message that the war in Iraq was over during his famed aircraft carrier speech on May 1, 2003, and then the war continued for many years?  Is that what will happen with the PHE?

As it goes, there isn’t a requirement that  HHS outline any specific criteria to be met for the PHE to end.  The Health and Human Services Secretary has the option of declaring the PHE over, or he may simply not extend the current emergency.  For their part,  the American Health Care Association offered one suggestion – that the  PHE be lifted if roughly 70% of the population has been vaccinated, or less than 500 COVID-19 deaths have occurred for 14 consecutive days . 

Key Measures Linked to the PHE

Both Congress and the Administration have advanced key COVID-19 relief measures whose expiration dates are linked to the termination of the PHE.  Below is a list of pivotal relief measures and their central provisions.

  • Certain measures included in COVID-19 relief legislation.  Many policies tied to the PHE are included in the Families First Coronavirus Response Act, enacted March 18, 2020, the CARES Act, enacted March 27, 2020, and the American Rescue Plan Act, enacted March 11, 2021.  Some of these measures expire at the conclusion of the PHE, while others have a specific end date beyond the PHE, such as the one year or one calendar quarter after the termination of the PHE.  Key provisions include:
    • Enhanced coverage and no cost-sharing for COVID-19 testing and vaccines under Medicare, Medicare Advantage, Medicaid, CHIP, and TRICARE.
    • Waived or modified Medicare requirements for telehealth, such as the restriction on use of a telephone and the requirement for face-to-face visits between home dialysis patients and physicians.
    • Increased Medicaid federal match rate to 6.2%.
    • Waived site-neutral payment rate provisions for long-term care hospitals.
    • Continued payments to providers via the Medicare Hospital Accelerated Payment Program.
    • Recalculated Medicaid disproportionate share hospital allotment.
  • Temporary regulatory flexibilities under CMS.  In interim final rules published on March 31, May 8, September 2, and November 2, 2020, the Centers for Medicare and Medicaid Services (CMS) has relaxed numerous Medicare and Medicaid rules for the duration of the PHE.  Examples include testing and reporting requirements for long-term care facilities, enhanced Medicare reimbursement for certain COVID-19 treatments, and price transparency requirements for COVID-19 tests.  The interim final rules also include a number of telehealth provisions, with notable examples including:
    • Waived requirements on the types of practitioners that can furnish Medicare telehealth services to include all practitioners eligible for Medicare reimbursement, including physical therapists, occupational therapists, and speech language pathologists.   
    • Modified reporting requirements for remote physiological monitoring services.
    • Payment parity for audio-only telephone services.
    • Allowing hospitals to bill for services provided remotely by hospital-based practitioners to Medicare beneficiaries registered as outpatients.
    • Allowing teaching physicians to review services provided by resident physicians remotely via audio-visual communications technology.
  • Section 1135 Waivers.  Since the start of the pandemic, CMS has invoked Section 1135 waiver authority to issue a blanket waiver and a series of state-specific waivers that expand telehealth coverage, allow clinicians to practice across state lines, and suspend some reporting requirements.  All of these waivers are set to expire at the conclusion of the PHE.
  • HIPAA Enforcement.  The HHS Office of Civil Rights has relaxed certain HIPAA privacy rules for the duration of the PHE that apply to telehealth technologies, testing sites, and web-based scheduling platforms for COVID-19 vaccination appointments.  
  • Stark and Anti-Kickback Statute.  The HHS Office of the Inspector General has issued guidance discouraging enforcement of pandemic response activities until the end of the PHE that could be viewed as problematic under the anti-kickback statute and the Stark Laws. 
  • Controlled Substances. Both the Substance Abuse and Mental Health Services Administration and the Drug Enforcement Administration have issued guidance allowing more flexibility for providers and opioid treatment programs to prescribe controlled substances during the PHE.

Previewing a Post-PHE World

As vaccinations increase and jurisdictions gradually reopen, the fate of temporary policies that expire at the end of the PHE remains unclear.  Fortunately, recent actions by federal officials offer clues as to how some of temporary policies may be retained, particularly those relating to telehealth.  As expressed by then-CMS Administrator Seema Verma in December 2020, congressional action will be essential to ensuring expanded telehealth coverage and other flexibilities can be made permanent.  Since then, policymakers have been providing suggestions to lawmakers on what to do with telehealth after the PHE ends.  In its March 15, 2021 report to Congress, for example, the Medicare Payment Advisory Commission recommended continuing some telehealth flexibilities one to two years following the end of the PHE to evaluate whether the temporary policies should be adopted permanently.  The report also provided the following recommendations to Congress:

  • Continue Medicare coverage for telehealth services, regardless of a beneficiary’s location.
  • Discontinue allowing providers to reduce or waive cost-sharing for telehealth.
  • Continue coverage of audio-only services if there is a clinical benefit.

Additionally, members of Congress have put forth their own proposals to permanently expand telehealth.  Key legislation introduced so far includes:

  • H.R. 366, the “Protecting Access to Post-COVID–19 Telehealth Act of 2021,” introduced by Rep. Mike Thompson (D-CA), which would eliminate most geographic and originating site restrictions on the use of telehealth in Medicare and authorize CMS to continue reimbursement for telehealth for 90 days beyond the end of the PHE.
  • H.R. 787, the “Expanding Student Access to Mental Health Services Act,” introduced by Rep. Rick Allen (R-GA), which would permanently expand telehealth services for students.
  • H.R. 937, the “Tech to Save Moms Act,” introduced by Rep. Eddie Bernie Johnson (D-TX), which would integrate telehealth models into maternity care services.

While the federal government may not yet have a specific plan on how it intends to handle temporary regulatory flexibilities once the pandemic expires, recent action from legislators and policymakers suggest a desire to keep at least some policies around permanently. 

The Government’s Ambitions Plans to Grow Broadband Access

A major barrier to widespread telehealth adoption in the United States is lack of access to broadband internet.  While telehealth utilization has surged since the start of the COVID-19 pandemic, telehealth’s potential for growth is limited by lack of high-speed internet connections for both patients and providers.

However, not all Americans have access to broadband.  A 2019 Federal Communications Commission (FCC) report found 21.3 million Americans, or 6.5% of the population, currently lack access to broadband.  Furthermore, a 2021 survey by BroadbandNow found 42 million Americans are unable to afford broadband without any assistance.  According to the Office of the National Coordinator for Health Information Technology, broadband service provides a higher-level speed of data transmission, which is particular important for live videoconferencing with health care practitioners.  Additionally, broadband allows health care providers to meaningfully use patient information, such as electronic health records, to improve patient outcomes. 

Fortunately, the federal government has taken some steps to boost broadband access. To help patients afford broadband access, the Consolidated Omnibus Appropriations Act, 2021 (P.L. 116-260) provided $3.5 billion to the FCC to establish a program to help low-income Americans get or stay connected to broadband.  The program is required to provide a $50 subsidy for qualified households who must include at least one individual who is eligible for the Lifeline Program, the Supplemental Nutrition Assistance Program, or a Pell Grant.

Providing direct government subsidies to individuals to access broadband looks likely to be part of an upcoming legislative effort to address the nation’s infrastructure needs.  The American Jobs Plan, the Biden Administration’s highly anticipated $2 trillion infrastructure proposal, high-speed broadband to every American, including the 35% of rural Americans who lack high-speed broadband.  Among the ways the Administration plans to achieve this include:

  • Providing individual subsidies to cover internet costs in the short-term and reducing costs through widespread adoption in the long-term.
  • Prioritizing support for broadband networks owned or operated by local governments, non-profits, and cooperatives.
  • Promoting transparency and competition among internet providers and requiring providers to publicly disclose prices their charge.

Direct subsidies are also included in the Leading Infrastructure for Tomorrow’s (LIFT) American Act.  Co-sponsored by all 32 Democrats on the House Energy and Commerce Committee, this proposal will provide a basis for House Democrats’ action on energy and broadband in the Congressional infrastructure bill.  The bill would grow high-speed internet access by:

  • Authorizing an additional $6 billion for the FCC program that provides a discount of up to $50 off the cost of monthly broadband service for eligible households. 
  • Providing $80 billion to develop secure broadband nationwide by funding connections to underserved rural, suburban, and urban communities.
  • Allocating $5 billion in federal funding for low-interest financing of broadband deployment.

While health care providers are already advocating for making permanent some of the Medicare and Medicaid flexibilities for telehealth enacted into law as the result of the coronavirus pandemic, they should be keen to keep an eye out for additional discussion and debate on broadband access.  Both the government’s recent actions to expand broadband and Democratic proposals to boost broadband even further suggest a strong desire to build out an infrastructure that will allow telehealth to flourish in a post-pandemic world.

Amazon Moves to Disrupt Health, Influence Policy

Amazon is primed to disrupt primary care just like the tech giant has done to retail, cloud computing, and package delivery services.  This time, it’s telehealth. 

On March 17, 2021, Amazon took a major step forward in expanding its health care reach by announcing  plans to make Amazon Care, its virtual health service benefit, available to all of its US employees this summer.  Furthermore, Amazon announced its telehealth service will be available to other companies.  Over the next few months, the company also intends to expand its Amazon Care in-person health centers to Washington, DC, Baltimore, and several other cities. 

In September 2019, the company launched Amazon Care for employees and their families in the Seattle metropolitan area.  Amazon Care offers telehealth as well as in-person primary care visits at patients’ homes or in-office.  Additionally, the service incorporates Amazon Pharmacy, the company’s prescription drug delivery service that launched in November 2018

Amazon Care is not the company’s first foray into health care.  In addition to Amazon Pharmacy, the tech giant teamed up with primary care group Crossover Health in 2020 to launch health care centers near its operations facilities and fulfillment centers in Phoenix, Louisville, and Dallas-Fort Worth, with more facilities planned in 2021.  Notably, the company joined forces with JPMorgan Chase and Berkshire Hathaway in January 2018 to launch a new non-profit venture called Haven.  The new venture was intended to utilize the vast resources of its founding companies to address the complexity of health care coverage and rising health care costs. However, Haven was eventually scuttled in January 2021, with lack of a strategy, leadership turnover, and the enormous scale of problems facing the US health care industry cited as likely culprits. 

As illustrated by Haven, Amazon Care’s success is far from guaranteed.  The service faces stiff competition from other well-funded telehealth services, including Doctor on Demand and PlushCare.  Additionally, there has yet to be any data posted on whether Amazon Care has been successful in reducing costs, which was one of Haven’s initial goals.  However, Amazon Care stands out from its competitors by offering integrated pharmacy services and a potential built-in customer base from the over 150 million Amazon Prime subscribers. 

Through its recent ventures into the health care industry, Amazon may be signaling a desire to use its growing health care clout to influence health care policy.  In March 2021, Amazon Care joined with Intermountain Healthcare, Ascension, and several other providers to launch Moving Health Home, a new coalition aimed at changing the way “policymakers think about the home as a site of clinical service.”

Amazon’s desire to impact home health care policy is reflective its overall efforts to enhance its advocacy capabilities in recent years.  In 2020, the company logged $18.7 million in lobbying expenditures, including on health care matters, a nearly two-fold increase from its $9.4 million total expenditures in 2015.  Amazon also boasts 17 registered lobbyists in addition to the 24 lobbying firms on its retainer.  Former Obama Administration White Press Secretary Jay Carney has served as the company’s Senior Vice President of Global Corporate Affairs since 2015, and the company notably chose the Washington, DC metropolitan area for the site of its highly anticipated second headquarters.

By growing its influence in Washington and demonstrating a wiliness to shape home health and other policy areas, Amazon may be using its newfound efforts in telehealth and primary care as another means to sway health policy and achieve its goal of disrupting health care in America.