Telehealth billing does not fairly value doctors’ expertise and time

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Since the COVID-19 pandemic, telehealth has become a staple of primary care. However, as virtual visits increase, experts say the current telehealth billing system is flawed — potentially discouraging both doctors and patients.

The current time-based billing model used in Ohio and across the U.S. does not account for varying levels of physician expertise and experience, leaving skilled doctors under-compensated, according to Dong-Gil Ko, PhD, an associate professor at the University of Cincinnati’s (UC’s) Carl H. Lindner College of Business.

Although experienced doctors can respond quickly to patient inquires, they often earn less from telehealth visits, because the current billing model prioritizes time over skill.

Ko, whose research was published in the Journal of the American Medical Informatics Association, argues that the system undervalues cognitive judgement and may inadvertently reward inefficiency.

The current telehealth billing model

Under Ohio’s current medical billing code, which took effect in 2023, doctors are compensated based on the time spent responding to a patient’s question via a secure messaging system.

• If a doctor spends fewer than five minutes answering, the service is free.
• If the response takes the doctor longer than five minutes, they are compensated based on tiered time increments, with higher payments for longer responses.

This structure creates an imbalance, and, according to Ko, is unsustainable. A newly minted resident who takes longer to craft a response may be paid more than an experienced physician who delivers an accurate answer quickly.

“This creates a systemic issue,” Ko said. “If we follow the American Medical Association’s (AMA’s) guidelines, less experienced doctors are compensated while experts may not be.”

Impact on the quality of telehealth care

The uncertainty of whether a patient will be billed could also erode trust in the health care system, according to Ko. Patients may hesitate to ask important medical questions if they are unsure of whether they will be charged.

Additionally, the lack of a standardized system for measuring doctors’ work could put physicians in difficult positions. Unlike an in-person visit, where billing codes are based on clear interactions, doctors answering telehealth inquiries “don’t measure response time with a stopwatch,” said Ko, adding that some questions may require multiple exchanges or follow-ups, further complicating billing decisions.

An AI-driven solution

To address these shortcomings, Ko is collaborating with Umberto Tachinardi, MD, chief health digital officer of UC Health, and Eric J. Warm, MD, an internal medicine physician and researcher at the UC College of Medicine. The team is leveraging artificial intelligence (AI) and electronic health records (EHRs) to develop a new telehealth billing model.

“We need balance,” Ko said. “Both time and medical expertise must be considered in billing.”

Ko’s research explores how AI can analyze doctors’ behavior to better understand and quantify their expertise. Machine learning models (MLMs) tested by the research team have delivered consistent results, suggesting the potential for a more accurate and fair billing framework.

Ko anticipates that telehealth billing challenges will grow as generative AI becomes more integrated into medical practice. Although AI tools can generate responses quickly, physicians must still validate those responses, invest time in training AI systems and ensure accuracy — efforts that need to be recognized in the billing process.

“At the early stages, validating AI-assisted responses will be critical,” Ko said.

Looking ahead, Ko aims to pilot a system in 2025 that could predict whether a patient will be billed prior to submitting their question. His broader goal is to uncover insights from patient data to improve care outcomes while ensuring fair compensation for experienced physicians.