HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Tuesday, May 24, 2011

Guest Blogger Vickie J. Williams: Liberalizing Credentialing and Privileging for Telemedicine

Williams_31 In a development that may have more immediate and practical effect on the way many of us receive our health care than all the health-care reform going on at the congressional and executive level, in the May 5, 2011 Federal Register, The Centers for Medicare and Medicaid Services (CMS) quietly published their final rule on Telemedicine Credentialing and Privileging for Medicare-participating hospitals and Critical Access Hospitals (CAHs).  The rule liberalizes the Medicare Conditions of Participation (CoPs) to allow hospitals and CAHs to rely on practitioner credentialing and privileging that has been done by another Medicare-participating hospital to allow the practitioner to provide telemedicine services to the hospital’s patients.  Prior to this rule, CMS required a hospital to go through a full credentialing and privileging process for all practitioners providing services to its patients, including those providing telemedicine services, even when the practitioner was never going to set foot in the hospital or physically touch a patient.  In order to take advantage of the liberalized credentialing and privileging process for telemedicine providers, the receiving hospital must also ensure that the telemedicine practitioner holds a license issued or recognized by the state in which the hospital whose patients are receiving the telemedicine services is located, and the receiving hospital must have evidence of an internal review of the distant-site practitioner’s performance of the distant-site’s privileges.  At a minimum, the review must include all adverse events that result from telemedicine services provided by the distant-site practitioner to the hospital’s patients, and all complaints that the hospital has received about the distant-site physician or practitioner.  42 CFR §482.22.  The final rule is very similar to the proposed rule that was published a year ago, but expands the reach of the alternative credentialing for telemedicine providers to allow a hospital or CAH to contract with non-hospital entities providing telemedicine services to hospitals and CAHs, as long as such contracts meet Medicare CoPs.  The new rules are effective as of July 5, 2011.


It is nice to see CMS acting relatively quickly to facilitate what can be a cost-effective and relatively simple way to enhance quality-of-care and provide access to specialists for people in rural and outlying areas.  As a resident of a small city that is a medical hub for a large, sparsely populated, I am well aware of the value of telemedicine services, and I support this liberalization.  Nevertheless, the comments submitted in response to the proposed regulations, and CMS’ responses to those comments, raise a few interesting legal questions that I have been pondering for a while (but have not yet managed to put in a law review article).  For example, if the receiving hospital is relying on the credentialing and privileging process of the distant-site hospital or telemedicine entity, the potential defendant pool in a negligent-credentialing malpractice case is expanded to include a hospital or entity that never actually treated the patient.  And if a hospital or entity in a remote location is accused of negligent credentialing or other malpractice-type wrongdoing, there could be a serious question regarding whose standard of care applies to the situation.  The requirement that the actual practitioner providing the telemedicine services be licensed in the same state as the receiving hospital may dictate that the law of the state of the receiving hospital will apply to any malpractice alleged against the practitioner, but presumably the credentialing and privileging by the distant-site entity took place in the remote location.  There could also be questions about personal jurisdiction and venue for a suit against the distant-site entity, which probably make you shudder just to consider.  You might have guessed from my articulation of these issues that I teach Conflict of Laws and Civil Procedure in addition to Health Law, and I see a really good exam question coming out of this scenario in some law students’ futures.


Another interesting thought was raised by a commenter who believes that the liberalized credentialing and privileging contemplated under the rule are likely to be misused by hospital and CAH governing bodies to “sidestep” medical staff decisions regarding credentialing and privileging, and to economically pressure hospital-based practitioners because it will now be easier to replace them with distant-site practitioners.  CMS’ response basically brushed this comment aside, stating that the process of privileging by proxy has been common for hospitals accredited by The Joint Commission (TJC) for some time, and that there are no indications that such problems have arisen.   Besides feeling sorry for the practitioner who submitted the comment, who must have a very distrustful relationship with the hospital or CAH that employs the commenter, I am also not so sure that I would dismiss this comment so cavalierly.  Hospitals that use economic reasons or “business decisions” as rationales for closing departments and terminating staff privileges without going through the processes outlined in the medical staff bylaws have been relatively successful in having courts uphold those decisions.  To the extent that the liberalized credentialing and privileging rules make telemedicine less expensive and more convenient for hospitals and CAHs, the rules may very well have the ultimate effect of making it easier for hospitals to terminate physicians or other practitioners without triggering the protections of the medical staff bylaws.  This is not necessarily a bad thing, nor is it necessarily within the realm of things that CMS should consider when making this rules change, but there is evidence that it is a real issue.  How one feels about this depends on whether one views medical staffs as anti-competitive cartels that need to be busted, or as legitimate protectors of quality and independence for physicians and medical practitioners.  Sort of like the way people line up in the debate about whether tenure for faculty is a good thing or a bad thing, but I won’t get into that here.


Finally, the most amusing thing in the regulations was contained in a part of federal register that I usually just skim over, and I suspect most of you do the same.  In the section about “Anticipated Effects” of the new rule, the CMS states that it believes that in order to implement the new rule, the initial services of a hospital or CAH attorney will be needed for 12 hours at a cost of $86 per hour.  This salary figure is based on recent wage estimates from the Bureau of Labor Statistics (BLS), and marked-up 33% for benefits.    Does anybody know a brand new attorney with even minimal knowledge of health care regulation who could produce a regulation-compliant contract, and who bills at $86 per hour?  If you do, I think we can promise him or her a steady stream of customers!

- Vickie J. Williams

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