New Telehealth Rules, New POS Codes - What to Know About POS 10 and POS 02

Since the COVID-19 outbreak, telehealth has emerged as a cornerstone of healthcare delivery, enabling patients to access care from the comfort and safety of their homes. Recognizing the rapid shift in healthcare dynamics, the Centers for Medicare & Medicaid Services (CMS) acted swiftly to address the billing complexities of this new normal. 

To ensure providers receive accurate reimbursements for telehealth services, CMS introduced updated Place of Service (POS) codes, including the new POS 10 and an updated POS 02. These changes mark a significant step in aligning telehealth billing practices with modern care delivery methods, ensuring clarity and efficiency for providers and payers alike.

What is POS 10 Code?

POS 10 Code refers to a specific Place of Service (POS) code introduced by the Centers for Medicare & Medicaid Services (CMS) to streamline billing for telehealth services. This code was created to differentiate telehealth services based on the location of the patient during the encounter.

Definition: 

POS 10 is used to indicate telehealth services provided to a patient in their home. The term "home" is defined as the location where the patient resides, which can include a private residence, temporary lodging, or another non-facility living arrangement.

Purpose: 

This code ensures clarity in billing and helps distinguish services provided to patients in their homes from those provided in other locations. It supports accurate reimbursement by delineating where the service was rendered.

Implementation Date: 

The POS 10 code was officially implemented on January 1, 2022, but its use became effective for billing on April 1, 2022.

POS 10 Changes

In 2024, the implementation of Change Request 13582 significantly impacted how Medicare Administrative Contractors (MACs) process telehealth claims, particularly for services billed under Place of Service (POS) 10. Effective from July 8, 2024, this update aligned Medicare telehealth payment policies with the evolving needs of telehealth services, offering clearer reimbursement structures based on the POS codes used.

Key Changes and Their Implications:

1- Higher Reimbursement Rates for POS 10
Starting January 1, 2024, the Physician Fee Schedule (PFS) introduced a significant update: telehealth services billed with POS 10 (indicating services provided in a patient's home) are now reimbursed at the non-facility rate, which is higher than the facility rate. This marks a departure from previous reimbursement policies, where telehealth services at home often received lower rates.

2- Modifiers for Telehealth Billing
Regardless of the POS code selected, claims must include appropriate telehealth-specific modifiers:

• Modifier 93: Indicates audio-only telehealth services.

• Modifier 95: Indicates audio/video telehealth services.

While the modifiers reflect the mode of service delivery, they do not affect the reimbursement rate. The POS code alone determines whether the claim qualifies for facility or non-facility payment rates.

Implications for Providers:

• Strategic Use of POS Codes: Providers must now carefully evaluate their billing practices to select the most appropriate POS code (02 or 10) to maximize reimbursements based on the service location.

• Focus on Compliance: Accurate pairing of POS codes with the appropriate telehealth modifiers (93 or 95) is crucial to avoid claim denials or delays.

• Increased Revenue Potential: The shift to the non-facility rate for POS 10 offers providers an opportunity for higher reimbursements, incentivizing more widespread use of telehealth services in home settings.

When to Use POS 2?

Place of Service (POS) 02 is designated for telehealth services provided to a patient outside of their home. This code differentiates such services from those provided in the patient’s residence (POS 10). Using POS 02 ensures accurate reporting and appropriate reimbursement under Medicare and other payer systems.

Situations Where POS 02 is Applicable:

1. Non-Residential Settings
   Telehealth services delivered while the patient is in a location other than their home, such as:

   • A workplace

   • A school

   • A community center or public facility

   • A temporary lodging outside the definition of "home" (e.g., hotel or shelter)

2. Facility-Based Locations
   If a patient receives telehealth services from:

   • A skilled nursing facility

   • A hospital or clinic

   • A community health center

   • Any healthcare facility where the patient is temporarily located

3. Billing Under Facility Payment Rate (F)
   Providers should select POS 02 when telehealth services qualify for the facility payment rate, reflecting services delivered in a clinical or institutional setting where overhead costs are borne by the facility.

POS 2 vs POS 10 

 

Aspect	POS 02	POS 10
Definition	Telehealth services provided to a patient outside their home.	Telehealth services provided to a patient in their home.
Location	Any non-residential setting, such as: - Workplace - School - Community center	The patient’s residence, including: - Private home - Temporary lodging - Any living arrangement considered the patient’s home
Reimbursement Rate	Facility Payment Rate (F): Lower reimbursement reflecting facility-based overhead costs.	Non-Facility Payment Rate (NF): Higher reimbursement reflecting provider-incurred overhead costs.
Applicable Scenarios	- Patient joins telehealth from a school, workplace, or hospital.	- Patient participates in telehealth while at home or a home-like environment.
	- Patient temporarily residing in a care facility.	- Telehealth from a private residence or non-institutionalized living arrangement.
Modifiers Required	- Modifier 93: Audio-only telehealth.	- Modifier 93: Audio-only telehealth.
	- Modifier 95: Audio/video telehealth.	- Modifier 95: Audio/video telehealth.
Introduced Purpose	Distinguishes telehealth services delivered in non-home settings.	Specifically identifies telehealth services delivered in the patient’s home.
Relevance in 2024	One of the only two valid POS codes for Medicare telehealth billing in 2024.	One of the only two valid POS codes for Medicare telehealth billing in 2024.

Words By Author

The introduction of POS 02 and POS 10 marks a pivotal step in aligning telehealth billing practices with modern healthcare delivery. These codes not only ensure accurate reimbursement but also reflect the evolving landscape of patient-centered care. For providers, understanding when and how to use these codes is essential for compliance, optimized reimbursement, and delivering seamless telehealth services.

As telehealth continues to grow, staying informed about CMS updates, utilizing appropriate POS codes, and adhering to modifier requirements will remain crucial. By mastering these elements, healthcare providers can ensure financial stability while continuing to prioritize patient access and care quality in the digital age.