Understanding Telehealth Payment and Coverage Parity

Understanding Telehealth Payment and Coverage Parity

As telehealth continues to evolve and expand access to care, understanding how it’s reimbursed is critical. Two important policy concepts often come up in discussions about telehealth reimbursement: coverage parity and payment parity. Though related, they serve different purposes and impact both patients and providers in distinct ways.

Coverage Parity

Coverage parity means that a health insurance plan must cover a telehealth service if it covers the same service when provided in person. In other words, if a health plan pays for an in-person behavioral health visit, it must also cover that same visit when delivered through telehealth.

However, coverage parity doesn’t guarantee equal reimbursement—it only ensures that telehealth is recognized as a valid method for delivering care. The actual payment amount could still differ between telehealth and in-person visits, depending on the payer’s policies.

Do UMTRC States have Coverage Parity?

Illinois – Yes

“An individual or group policy of accident or health insurance shall cover telehealth services, e-visits, and virtual check-ins rendered by a health care professional when clinically appropriate and medically necessary to insureds, enrollees, and members in the same manner as any other benefits covered under the policy. An individual or group policy of accident or health insurance may provide reimbursement to a facility that serves as the originating site at the time a telehealth service is rendered.” - SOURCE: IL Insurance Code. Sec. 215 ILCs 5/356z.22. 

Indiana – Yes

“Coverage must be provided in accordance with the same clinical criteria as would be provided in-person.” - SOURCE: IN Code, 27-8-34-6 & 27-13-7-22.

Michigan – Yes

“An insurer that delivers, issues for delivery, or renews in this state a health insurance policy shall not require face-to-face contact between a health care professional and a patient for services appropriately provided through telemedicine, as determined by the insurer.

If a service is provided through telemedicine under this section, the insurer shall provide at least the same coverage for that service as if the service involved face-to-face contact between the health care professional and the patient.” - SOURCE: MI Compiled Law Svcs. Sec. 500.3476

Ohio - Yes

“A health benefit plan shall provide coverage for telehealth services on the same basis and to the same extent that the plan provides coverage for the provision of in-person health care services.

A health benefit plan shall not exclude coverage for a service solely because it is provided as a telehealth service.” - SOURCE: OH Revised Code Annotated, 3902.30.

Payment Parity

Payment parity (sometimes called reimbursement parity) goes one step further. It requires health plans to pay providers the same amount for a telehealth visit as they would for the equivalent in-person service.

This policy can be important for providers operating on tight margins—such as rural clinics or community health centers—because it can allow telehealth services to be more financially sustainable.

Do UMTRC States have Payment Parity?

Illinois – Yes (Conditional)

“For purposes of reimbursement, an individual or group policy of accident or health insurance shall reimburse an in-network health care professional or facility, including a health care professional or facility in a tiered network, for telehealth services provided through an interactive telecommunications system at the same reimbursement rate that would apply to the services if the services had been delivered via an in-person encounter by an in-network or tiered network health care professional or facility.

This subsection applies only to those services provided by telehealth that may otherwise be billed as an in-person service. This subsection is inoperative on and after January 1, 2028, except that this subsection is operative after that date with respect to mental health and substance use disorder telehealth services.” - SOURCE: IL Insurance Code. Sec. 356z.22. 

Indiana – No

Michigan – No

Ohio – No

Federal Policies

Parity laws vary widely from state to state, and between different types of payers:

• Medicare does not have a blanket payment parity requirement and may pay different rates for telehealth versus in-person care, depending on the service.
• Medicaid programs are state-run and vary significantly—some states have strong parity protections, while others do not.
• Private insurers are subject to state laws, but even in states with parity mandates, insurers may include exceptions or require specific conditions to be met (e.g., synchronous video use).

Updated July 2025