CMS Proposal Would Slash Medicare Remote Monitoring Costs to $194 Million

The Centers for Medicare & Medicaid Services has proposed a rule that would stop paying Medicare providers for remote patient monitoring services administered by outside technology companies. Under the plan, CMS would only reimburse clinicians when a staff member at the provider’s own facility manages the care. This change would directly impact the $194 million in annual spending on these programs in traditional Medicare.

The proposal stems from 2024 and 2025 reports by the Department of Health and Health Services’ Office of Inspector General. Those audits flagged concerns about fraud, insufficient data collection, and a lack of direct clinician involvement. CMS spokesperson Timothy Foster said the agency recognizes the value of technology-enabled care but requires stronger safeguards. He noted that outside vendors often have little to no established relationship with patients or their doctors, which the rule argues can fragment care.

Caroline Pearson, executive director of the Peterson Center on Healthcare, warned the rule would dramatically reduce access for many beneficiaries. She stated that rural communities would be the hardest hit because most rural facilities lack the staff to monitor devices internally. Edward Vance, chief medical officer at Albany Area Primary Health Care in Georgia, said his system serves low-income patients and operates on shoestring budgets. He noted that the facility could not offer remote monitoring without contracting with an outside vendor like CoachCare.

Dianne Williams, a patient in rural Georgia, uses a blood pressure cuff that transmits data to a private company’s nursing staff. She credited the service with helping her lower her blood pressure and change her diet. Vance and other experts note that while only 1% of traditional Medicare patients currently use remote physiologic monitoring, enrollment grew tenfold from 2019 to 2023. The average duration of these programs also increased from 1.7 months to 5.2 months over that same period.

The proposed rule applies only to traditional Medicare, not Medicare Advantage plans, which cover more than half of all participants. However, industry leaders fear the change will spread to Medicaid and private insurers. Andrew Van Ostrand, senior vice president at the Alliance for Connected Care, called the proposal a surprise. He argued the rule conflicts with the president’s $50 billion Rural Health Transformation Program, which encourages tech adoption. States have already earmarked at least $240 million from first-year rural health funding for these services.

As of September 14, more than 230 health tech vendors and advocacy groups had signed a letter opposing the rule. Major insurers like Humana and Blue Cross Blue Shield Association support the change. The Peterson Center report found that program spending rose from just under $7 million in 2019 to over $194 million in 2023. Pearson argued that Medicare should limit the duration of monitoring to ensure clinical necessity rather than revenue generation.