National Telemedicine and Related Legislation
Neal Neuberger, Chair, ATA Federal Policy Committee
Jonathan D. Linkous, ATA Executive Director

(Adapted from a report to the DHHS Office of Disease Prevention and Health Promotion by Health Tech Strategies)

Below is a summary of proposed and enacted legislation from the first session of the 106th Congress affecting telemedicine and related programs of the federal government. Major changes to departmental programs (pending or passed) are included to document a shift in program emphasis from present agency practice. Minor references in floor statements, committee reports, and omnibus legislation of slight consequence to the field have not been included.

1) S.770 Comprehensive Telehealth Act of 1999
Primary Sponsor: Sen. Kent Conrad (D-N.D.)
S.980 Promoting Health in Rural Areas Act of 1999
Primary sponsor: Sen. Max Baucus (D-MT)
H.R. 1344 Triple-A Rural Health Improvement Act of 1999
Rep. Jim Nussle (R-IA)
Status: Attempts to incorporate provisions into Budget Act during first term failed.

All three bills amend the Medicare program reimbursing for telemedical services to residents of rural Health Professional Shortage Areas (HPSAs) and would open up reimbursement for consultations using store-forward technologies, a priority for ATA. The bills also include various other provisions affecting telemedicine including expanding the definition of who is eligible to present the patient to the consulting practitioner, clarifying eligible services, expanding eligible geographic areas and expanding the current rural telemedicine demonstration grant program to include a new loan program.

Much discussion has taken place recently about adding a provision changing the current requirement of sharing Medicare fees between presenting and consulting practitioners. Current policy requires a 25-75 split of the fee between the two. At present no specific language has been introduced to any of the the pending legislation that resolves this problem.

In addition S. 980 directs the Secretary to conduct a specified study on telehealth licensure for a report to the Congress. Moreover it would redesignate the Joint Working Group on Telemedicine as the Joint Working Group on Telehealth, with the chairperson being designated by the Director of the Office for the Advancement on Telehealth. Establishes the mission of the Joint Working Group, among other things, as identifying, monitoring, and coordinating Federal telehealth projects and programs and authorizes appropriations. The legislation directs the Secretary of DHSS to provide specified financial assistance to eligible telehealth networks for the purpose of expanding access to health care services for individuals in rural and frontier areas through the use of such networks.

Finally, in terms of Telemedicine the bill amends the Public Health Service Act to rename the Rural Health Outreach, Network Development, and Telemedicine Grant Program as the Rural Health Outreach and Network Development Grant Program, and to modify the renamed program.

2) S.580 Healthcare Research and Quality Act of 1999
Primary Sponsor: Senator Bill Frist (R-Tenn)
Status: became Public Law No: 106-129.

Comprehensive clinical research related legislation includes the following telemedicine section:


Not later than January 10, 2001, the Secretary of Health and Human Services shall submit to
the Congress a report that--

(1) identifies any factors that inhibit the expansion and accessibility of telemedicine services, including factors relating to telemedicine networks;

(2) identifies any factors that, in addition to geographical isolation, should be used to determine which patients need or require access to telemedicine care;

(3) determines the extent to which--

(A) patients receiving telemedicine service have benefitted from the services, and are satisfied with the treatment received pursuant to the services; and

(B) the medical outcomes for such patients would have differed if telemedicine services had not been available to the patients;

(4) determines the extent to which physicians involved with telemedicine services have been satisfied with the medical aspects of the services;

(5) determines the extent to which primary care physicians are enhancing their medical knowledge and experience through the interaction with specialists provided by telemedicine consultations; and

(6) identifies legal and medical issues relating to State licensing of health professionals that are presented by telemedicine services, and provides any recommendations of the Secretary for responding to such issues.


3) H. R. 2763 Internet Pharmacy Consumer Protection Act
Primary sponsor: Rep. Ron Klink (D-PA)
Status: Referred to the House Committee on Commerce

This proposed bill amends the Federal Food, Drug, and Cosmetic Act with respect to the sale of prescription drugs through the Internet. The bill states:

"A person may not introduce a prescription drug into interstate commerce or deliver the prescription drug for introduction into such commerce pursuant to a sale of the drug by such person if--

(1) the purchaser of the drug submitted the purchase order for the drug, or conducted any other part of the sales transaction for the drug, through an Internet site; and

(2) such site, or any other Internet site used by such person for purposes of sales of a prescription drug, fails to meet each of the requirements specified in subsection (b) (other than a site or pages on a site that are not intended to be accessed by purchasers or prospective purchasers)."

Enforcement is left primarily to the states with notification to the federal government but it leaves open the possibility for FDA to assist states in the enforcement.


4) H. R. 1795/ S.1110 National Institute of Biomedical Imaging and Engineering Establishment Act
Primary sponsors: Reps. Burr (R-N.C) Eschoo (D-CA); Sen. Lott (R-MS)
Status: Referred to the Committee on HELP and House Committee on Commerce.

Legislation introduced last May in both the House and Senate would amend the Public Health Service Act to establish the National Institute of Biomedical Imaging and Engineering to conduct and support research, training, the dissemination of health information, and other programs with respect to biomedical imaging, biomedical engineering, and associated technologies and modalities with biomedical applications. Among other things the legislation is proposed in consideration of findings that:

(1) Basic research in imaging, bioengineering, computer science, informatics, and related fields is critical to improving health care but is fundamentally different from the research in molecular biology on which the current national research institutes at the National Institutes of Health (`NIH') are based. To ensure the development of new techniques and technologies for the 21st century, these disciplines therefore require an identity and research home at the NIH that is independent of the existing institute structure.

(2) Advances based on medical research promise new, more effective treatments for a wide variety of diseases, but the development of new, noninvasive imaging techniques for earlier detection and diagnosis of disease is essential to take full advantage of such new treatments and to promote the general improvement of health care.

(3) The development of advanced genetic and molecular imaging techniques is necessary to continue the current rapid pace of discovery in molecular biology.

(4) Advances in telemedicine , and teleradiology in particular, are increasingly important in the delivery of high quality, reliable medical care to rural citizens and other underserved populations. To fulfill the promise of telemedicine and related technologies fully, a structure is needed at the NIH to support basic research focused on the acquisition, transmission, processing, and optimal display of images.

(5) A number of Federal departments and agencies support imaging and engineering research with potential medical applications, but a central coordinating body, preferably housed at the NIH, is needed to coordinate these disparate efforts and facilitate the transfer of technologies with medical applications.

(6) Several breakthrough imaging technologies, including magnetic resonance imaging (`MRI') and computed tomography (`CT'), have been developed primarily abroad, in large part because of the absence of a home at the NIH for basic research in imaging and related fields. The establishment of a central focus for imaging and bioengineering research at the NIH would promote both scientific advance and U.S. economic development.

(7) At a time when a consensus exists to add significant resources to the NIH in coming years, it is appropriate to modernize the structure of the NIH to ensure that research dollars are expended more effectively and efficiently and that the fields of medical science that have contributed the most to the detection, diagnosis, and treatment of disease in recent years receive appropriate emphasis.

(8) The establishment of a National Institute of Biomedical Imaging and Engineering at the NIH would accelerate the development of new technologies with clinical and research applications, improve coordination and efficiency at the NIH and throughout the Federal government, reduce duplication and waste, lay the foundation for a new medical information age, promote economic development, and provide a structure to train the young researchers who will make the pathbreaking discoveries of the next century.


5) S.911/H.R.2831 Emergency Medical Services Efficiency Act of 1999
Primary Sponsors: Sen. Rod Gramms (R-Minn); Rep. Bill Luther (DFL-Minn)
Status: Referred to various Senate and House Committees

The legislation introduced last April would amend title XVIII of the Social Security Act to ensure Medicare reimbursement for certain ambulance services, and to improve the efficiency of the emergency medical system, and for other purposes. Included in the provisions are amendments to the Food, Agriculture, Conservation, and Trade Act of 1990 to include State emergency medical services agencies among the entities eligible for Medicaid financial assistance with regard to telemedicine and distance learning services in rural areas.

The legislation would also amends the Balanced Budget Act of 1997 to allow a State emergency medical services agency to participate in the Informatics, Telemedicine, and Education Demonstration Project as part of an eligible health care provider telemedicine network (consortium).

6) S.1813 Clinical Research Enhancement Act of 1999
Primary Sponsor: Sen. Ted. Kennedy (D-Mass)
Status: referred to Committee on Judiciary

The legislation would amend the Public Health Service Act to provide additional support for and to expand clinical research programs, and for other purposes. Language is include indicating that one of the ways agencies would extend clinical research is through the use of Telemedicine.

7) H.R.3146 Health Care Restoration Act of 1999
Primary sponsor: Rep. Thomas Bliley (R-VA)
Status: referred to House Committee on Commerce and House Ways and Means Committee.

The much larger bill dealing with a variety of pending health issues before Congress would also authorize the use of payments under the Medicare PPS system for costs associated with the use of telecommunications systems.

(a) IN GENERAL- Section 1895(b) (42 U.S.C. 1395fff(b)) (as added by section 4603(a) of the Balanced Budget Act of 1997 and amended by section 5101 of the Tax and Trade Relief Extension Act of 1998 (contained in division J of Public Law 105-277)) is amended by adding at the end the following new paragraph:

"(7) USE OF TELECOMMUNICATIONS SYSTEMS- A home health agency receiving payment under the system under this subsection shall be permitted by the Secretary to use such payments to cover the cost of services, training, and supervision when they are provided to beneficiaries under this title in that beneficiary's place of residence via telecommunication systems. The payment available to the agency under such system shall be the same as it would be if the telecommunications systems were not used. Such telecommunications systems may not be substituted for services required to establish or maintain eligibility for home health services under section 1814(a)(2)(C) or 1835(a)(2)(A)"

(b) EFFECTIVE DATE- The amendment made by subsection (a) applies with respect to items and services furnished on or after the date of the enactment of this Act.

8) H.R. 3420 Telehealth Improvement Act of 1999
Primary sponsor: Rep. Brian Bilbray (R-CA)
Status: referred to House Commerce and Ways and Means Committees

Among other things the bill would amend Section 4206(a) of the Balanced Budget Act of 1997 to include reimbursement for all services furnished under Medicare if via Telehealth in all rural areas including those provided by physical, occupational, and speech therapy; and telehealth consultations using store and forward technologies. Presentation would be permitted by registered nurses acting under directions of a physician or practitioner. Telehomecare may be furnished in other than rural areas. The bill would require that the Secretary establish a cost based fee schedule for payments for the referring physician or practitioner and for the consulting physician or practitioner. The bill requires a report to Congress by August 1, 2003 concerning cross-state practice and efforts by states to develop uniform national licensure standards. An grant program within the HRSA Office of Advancement of Telehealth is established for Telehealth with $40 million available during FY 2001, and such sums in subsequent years. The Joint Working Group on Telemedicine is codified in statute.

9) H.R.3426 Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999
Primary sponsor Rep. Bill Thomas (R-CA)
Status: Incorporated by Reference into H.R. 3194, Enacted as P.L. 106-113

The omnibus Medicare, Medicaid legislation incorporated by reference and passed into law during the final days of the first session includes legislative language which would eliminate institutional cost-sharing requirements on the part of the HCFA contract awardee responsible for implementing Balanced Budget Act of 1997 provisions relating to an urban diabetes home management project using advanced telecommunications. The provision should clear the way for this project to move forward.

10) S. 1596 VA Appropriations Bill
Primary sponsor: Sen. Bond (R-MO)
Status: enacted as Public Law No: 106-74

The Veterans Administration Appropriations bill for FY 2000 includes Senate report language in support of the Alaska Health Care Partnership:

"The Committee supports the Alaska Federal Health Care Partnership's efforts to develop an Alaska-wide network to provide access to health services and health education information in remote areas of Alaska to the more than 200,000 Federal beneficiaries now living in Alaska, including more than 65,000 veterans. The partnership, a joint effort of the Department of Veterans Affairs, Department of Defense, Coast Guard, and the Indian Health Service, is creating 235 health care access sites over a 4-year period at VA, IHS, DOD, and Coast Guard clinical facilities throughout Alaska, linking remote installations and villages with tertiary health facilities located in Anchorage and Fairbanks. It should serve as a model for the use of technology for the delivery of health care services and health care education in remote and inaccessible settings. The Committee anticipates that the Alaska network will generate substantial savings by avoiding the high cost of transporting veterans from remote villages to Anchorage or other hub medical facilities for routine health problems and will result in a significantly higher level of available health care for Alaska veterans living in remote and inaccessible locations. The Committee recommends funding of $750,000 for the Department of Veterans Affairs to continue its participation in the partnership's Alaska project.

11) H.R. 2379 Critical Care Spectrum Act of 1999
Primary sponsor: Rep. Inslee (R-WA)
Status: referred to the House Committee on Commerce

The Critical Care Spectrum Act of 1999 seeks to ensure that adequate frequencies of the electromagnetic spectrum are available for biomedical telemetry. In general, the Federal Communications Commission would adopt rules to ensure support for existing and future needs within 1 year of enactment, and, upon consultation with the Joint Working Group on Telemedicine, report to Congress on the future spectrum needs of telemedicine and telehealth providers, including emergency medical services providers.

12) S.1059 National Defense Authorization Act for FY 2000
Status: enacted as Public Law No: 106-65

In addition to various earmarking provisions and program requirements for Telemedicine related organizations like TATRC at Ft. Detrick, the DoD Authorization bill for FY 2000 contains the following overarching provisions with regard to Telemedicine:

The bill establishes a "Department of Defense Center for Medical Informatics and Data" to address issues concerning quality; the digital patient record; decision support tools; medical performance report cards; and to conduct educational programs on medical informatics to meet identified needs. A DOD-DVA "Medical Informatics Council" is established to coordinate development, deployment, and maintenance of health care informatics systems to allow exchange and coordination of information within and among DOD, DVA and the Private Sector. The bill also establishes a series of joint Telemedicine and Telepharmacy demonstration projects by the Department of Defense and the Department of Veterans Affairs for purposes of evaluating the feasibility and practicability of providing health care services and pharmacy services by means of telecommunications. Three year demonstrations will be conducted at not more than five locations selected by the Secretaries and to include (1) Radiology and imaging services; (2) Diagnostic services; (3) Referral services; (4) Clinical pharmacy services; (5) Any other health care services or pharmacy services designated by the Secretaries.

Additional sums are made available for DoD Health Affairs, the Telemedicine Advanced Technology Research Center at Ft. Detrick, Maryland, Bureau of Medicine - Department of Navy, Joint Service Working Group on Telemedicine, and DoD Telemedicine-related activities.

13) S.1233 Agriculture Appropriations for FY 2000
Primary sponsor: Sen. Thad Cochran (R-Miss.)
Status: enacted as Public Law No: 106-78

Senate legislative and report language accompanying the bill would continue the Distance Learning and Medical Links program including loan authorization of $200,000; direct loan subsidies of $700,000; and grants of $12.5 million. The Distance Learning and Program is authorized by the Food, Agriculture, Conservation and Trade Act of 1990 (104 Stat. 4017, 7 U.S.C. 950aaa et seq.), as amended by the Federal Agriculture Improvement and Reform Act of 1996. This program provides incentives to improve the quality of phone services, to provide access to advanced telecommunications services and computer networks, and to improve rural opportunities. This program provides the facilities and equipment to link rural education and medical facilities with more urban centers and other facilities providing rural residents access to better health care through technology and increasing educational opportunities for rural students. These funds are available for loans and grants.

The Senate also included report language designed to encourage the Department to give consideration to the following applications for grants and loans: the National Center for American Indian and Alaska Native Mental Health Research Center multi state digital/distance learning project; a distance learning link between the Bennington school system and rural schools in Southern Vermont; the continuing education model distance learning program made up of a consortium of Kansas State University and community colleges in Colby, Dodge City, Garden City, and Liberal, KS; Hundley-Whaley Research Center, Missouri; Northern California Network; 1994 land grant institutions; and the Alaska Federal Health Care Access Network, a multi agency statewide initiative to provide health care services to remote communities on a cost-effective basis by saving unnecessary air transportation costs to urban and regional health care providers.

The Committee also is aware of the need for the distance learning and link program of the Maui Community College, the community hospital system, and the nutrition education activities of the University of Hawaii College of Tropical Agriculture and Human Resources. The Committee encourages the Department to fund a demonstration project to build upon existing resources and to further the use of advanced telecommunications by rural communities.

14) H.R. 2670 Department of Commerce Appropriations for FY 2000
Status: enacted as Public Law

The State, Justice, Commerce and Related Agencies Appropriations bill would continue the National Telecommunications and Information Administration TIIAP Grant program providing approximately $12.5 million to be made available during the next grant cycle across domain areas including health care. At the same time, H.R. 2630 the NTIA Reauthorization Act of 1999 is pending in the House, and would extend the program of NTIA (including TIIAP) through FY 2001.

15) S.1650/H.R.3037 Labor/Health and Human Services/ Education and Related Agencies Appropriations for FY 2000
Status: Re-introduced as H.R. 3424 and incorporated by reference into H.R. 3194, Enacted as Public Law

Following an presidential veto, and year end maneuvering to obtain an Labor/Health Appropriations bill for FY 2000, provisions were incorporated by reference into omnibus year end government continuation efforts and signed into law. While it is still unclear how much will be available various DHHS agencies/programs for Telehealth, it is understood that Office of Rural Health Policy / Office for the Advancement of Telehealth (HRSA) funding will be derived from two line items - the Rural Health Outreach Grant Program, total funding of $36.3 million, and Rural Health Research which is funded at $35 million. Within these amounts, the HRSA Telemedicine Grant program will likely be funded at a level of about $8 million for three years.

As agency staff determine their budgets, additional Telemedicine program funding may be made available thru the Office of Rural Mental Health Research, National Library of Medicine (several informatics-related programs), the Agency for Health Care Policy and Research, Health Care Financing Administration, or Office of Disease Prevention and Health Promotion. Each organization has a history of funding various efforts, and additional historical information may be found in several locations including the OAT web site at:

Health Tech
Strategies, LLC
Voice (703) 790-4933 Fax (703) 790-4934
6612 Brawner Street, McLean, Virginia 22101