The thrill of delivering newborns helped pull Dr. Jack Feltz into the field of obstetrics and gynecology.

More than 30 years later, he still enjoys treating patients, he says. But now Feltz is also working to change the way doctors are paid for maternity care.

Feltz’s New Jersey-based practice, Lifeline Medical Associates, recently partnered with the insurer UnitedHealthcare to test a new payment model. The insurer sets a budget with the practice to pay doctors one lump sum for prenatal services, delivery and 60 days of care afterward. If the costs come in below that amount, the medical practice gets to keep some of the savings. (Hospitals aren’t a part of this contract; the insurer pays them separately for their services.)

“We’ve always been taught to take care of patients as if they were our mothers and our daughters,” says Feltz, who also leads a coalition of obstetricians called the U.S. Women’s Health Alliance that advocates for high-quality, affordable care. “But now we have to take care of our patients as if they were our mothers and our daughters — and as if it was our money.”

This new program, announced in May, is a first step by the insurer to bundle physician payments for maternity care into a single flat fee that covers all care and procedures. A handful of insurers and state Medicaid programs are experimenting with similar models, sometimes incorporating hospitals and other health providers as well.

By moving from paying for maternity care in a piecemeal way to relying on bundled payments, insurers and doctors say they hope to cut costs and improve the quality of care for pregnant women.

But even fans of such a model acknowledge there are still significant obstacles to be worked out before this sort of flat-fee system could be implemented broadly.

The payment model is relatively new and still rare in maternity care; its structure can differ by insurer. Some insurers could pay a single amount to one doctor, who then uses part of it to cover hospital care. Other plans opt to cut a separate contract with the hospital. Insurers also vary in whether they make the lump sum payment before or after patients receive services. And the length of care, eligibility and services included in the bundle also vary.

In addition to, perhaps, reducing the overall cost of maternity care, the lump sums are seen by doctors and insurers as a possible way to improve health outcomes, including driving down the number of unnecessary cesarean sections in the United States.

About one-third of all deliveries in the U.S. occur via C-section, even though the World Health Organization estimates they are medically required in only 10% to 15% of births. The ratio of C-sections to live births varies dramatically among individual hospitals.

These surgeries can increase the risk of infections or other medical problems for the mother and baby. And they are more expensive than a vaginal delivery.

“The way we’ve been doing things is just not justifiable,” says David Lansky, a senior adviser at the Pacific Business Group on Health, a San Francisco-based coalition of private and public organizations that collectively purchase health care for 10 million Americans.

“The shift we’re talking about,” Lansky says, “is to say, ‘Someone is accountable for all the care that needs to be provided to support a family through this experience.’ “

Already, in traditional coverage, insurance payments for some women are delivered as bundled payments for some portions of their prenatal care, says Suzanne Delbanco, executive director of Catalyst for Payment Reform, a nonprofit organization that advises employers and other organizations that buy health coverage. However, she says, the new bundled payment models are different because insurers are adding quality measures that increase accountability to the bundle, as well as additional services such as labor and delivery.

Patients generally are not even aware their care is being handled under a bundled payment.

UnitedHealthcare, which announced its program in May, began testing the option with Feltz’s practice and another in Texas. The insurer says it hopes to expand to as many as 20 practices by the end of the year. Cigna and Humana are also piloting bundled maternity care programs. A few Medicaid programs, including those in Arkansas, Ohio and Tennessee, have experimented with it, too, in recent years.

Expanding the rarely used model to include maternity care could represent a major shift in health care finance. Births were the most common reason for hospitalizations among U.S. patients discharged in 2016, according to government data.

“Maternity care is kind of the sleeper of health care services,” says Dr. Neel Shah, an assistant professor of obstetrics, gynecology and reproductive biology at Harvard Medical School.

The change in payments is being made as the quality of maternity care in the United States comes under renewed scrutiny. An estimated 700 women in the U.S. die each year because of pregnancy-related complications, the federal Centers for Disease Control and Prevention reports. The rate of deaths in the U.S. is worse than in many other affluent countries, NPR and ProPublica reported in 2017.

C-sections also cost more than vaginal deliveries. In the Denver area, for instance, the average vaginal delivery costs $7,716 while the average C-section costs $14,274, according to 2019 data from the Health Care Cost Institute. On average, commercial and Medicaid insurers pay 50% more for C-sections than for vaginal deliveries, according to a 2013 report by Truven Health Analytics, a health industry consulting group.

Lansky’s group provided funding, data and oversight in 2014 for a project to test bundled payments for births in a variety of Southern California hospitals. According to their report, the rate of C-sections in first-time, low-risk pregnancies dropped by nearly 20% in less than one year among the first three participating hospitals.

However, some of the bundled-payment models have fallen short of aspirations. Tennessee saved money in 2017 after adopting the payment model for Medicaid beneficiaries. But the rate of C-sections remained unchanged, according to a report by the Medicaid and CHIP Payment and Access Commission, a nonpartisan advisory group for Congress.

In Ohio, where the Medicaid program covered complicated pregnancies as well as those that were low-risk, bundling payments into a lump sum for OB-GYNs cost the state more than expected, the advisory group found.

Bundling raises other concerns, too. Because some bundled-payment programs assign the total cost of care to a single physician, the financial burden falls on that physician. Dr. Lisa Hollier, the immediate past president of the American College of Obstetricians and Gynecologists, is concerned that these models may discourage team-based care.

If the physician providing prenatal care overlooks a problem that a different doctor must treat during delivery, for example, it wouldn’t be fair for the OB-GYN delivering the baby to bear the financial burden, Hollier says.

How payers define a low-risk pregnancy is also unclear, she says. If the target price for the suite of services in the model is not risk-adjusted for the cost of treating conditions like gestational diabetes, she says, doctors could be penalized for treating these patients.

Gestational diabetes occurs in up to 10% of pregnancies in the U.S. annually, according to the CDC, and patients with the condition need additional tests, checkups and insulin.

Julianne Pantaleone, national director of bundled payments and strategy at UnitedHealthcare, says that as the insurer works through its pilot program, it will cover the cost of physician care beyond the initial budget.

The lack of robust data systems built for handling bundled payments also poses a potential barrier for some medical practices, says Blair Barrett Dudley, a senior manager at the Pacific Business Group on Health.

Insurers and doctors need real-time data to ensure they are meeting the model’s quality measures, she says. However, these information banks are expensive to build, and many of the existing ones aren’t designed to handle this payment structure.

Feltz agrees that getting such data will be imperative to a successful bundled payment program. Without the information, he says, “it’s like launching a ship and not knowing where it’s going to go.”

Kaiser Health News is a nonprofit, editorially independent program of the Kaiser Family Foundation. KHN is not affiliated with Kaiser Permanente.

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In gridlocked Washington, both Democrats and Republicans have signaled there’s potential for a deal when it comes to lowering prescription drug prices. Now, there’s an idea both Congressional Democrats and the White House seem to like: They want to base U.S. prices on something called an international price index.

“The basic idea is to peg what the United States pays for a particular drug to the price paid in some set of other countries,” says Rachel Sachs, an associate professor of law at Washington University in St. Louis who specializes in drug pricing policy. “There are many different ways to identify other countries, and there are many different ways in which that international reference price could be used to negotiate for a price here.”

House Speaker Nancy Pelosi unveiled her sweeping plan to reduce drug prices Thursday, which included an international price index. There are lots of differences between that plan and the one the White House floated last fall, but the basics — and the appeal of the concept — are the same.

“It stops drug companies from ripping off Americans while charging other countries less for the drug,” Pelosi said in a press conference announcing the House plan, which would use drug prices in Australia, Canada, France, Germany, Japan, and the United Kingdom to create a baseline in negotiating prices.

She’s speaking President Trump’s language. Here’s what he told reporters in July: “Why should other nations like Canada — why should other nations pay much less than us? They’ve taken advantage of the system for a long time, pharma.”

Earlier this summer, the Department of Health and Human Services sent its own IPI proposal to the White House for review, though the details haven’t been made public. The idea of establishing an IPI is the only element of the administration’s plan to lower prescription drug prices still on the table — other ideas, like displaying list prices in TV ads and ending secret rebates for middlemen have been withdrawn or blocked in the courts.

A glimpse of what the HHS proposal might look like can be found in the outline of a Medicare model HHS released last fall. Like the House Democrats’ plan, the HHS model uses an index of countries to generate an average price. But, unlike the House plan, it would not let the secretary of HHS use that average to negotiate directly with drugmakers.

The HHS outline is also more limited in the drugs that would be eligible for this sort of price-setting. Medications eligible would be only a subset of drugs used by Medicare patients — mostly injections given in doctor’s offices — whereas the House plan would extend to a wider group of 250 brand-name drugs.

Another difference? “The House Democrats’ proposal envisions a non-compliance fee that would financially penalize drug companies who won’t bargain in a good-faith way with the administration,” Sachs says. “There’s no such enforcement mechanism in the administration’s IPI proposal.”

Both plans would use the average price internationally for each drug as a benchmark in negotiations, so that Americans don’t pay more than about 20% above what people in other countries pay. That’s still more than what people pay outside the U.S., but less than they pay now.

“The prices the U.S. is currently paying today can be two or three times as much, [though it] varies a lot by product,” says Stacie Dusetzina, a professor of health policy at Vanderbilt University School of Medicine. “This would be a major price reduction.”

One example of a drug priced much higher in the U.S. than elsewhere is Humira, a brand name rheumatoid arthritis drug. In 2015, it cost $2,669 a month in the U.S., while the list price in the U.K. was about half that — $1,362. The same drug cost only $552 in South Africa, according to the International Federation of Health Plans.

“I believe that the price of Humira now in the U.S. is about $63,000 a year,” says Ben Wakana, executive director of the advocacy group Patients for Affordable Drugs. “And [the drugmaker] AbbVie has raised the price eleven times between 2014 and 2018.” Wakana has a personal connection to Humira — his brother. In the U.S., there’s no generic competition that might push the price down, he notes.

“For patients like my brother and like the thousands of people who take Humira every year, that price is simply too high,” Wakana says. “We need competition. And if we can’t get competition, then we need to be able to negotiate with AbbVie for a fair price — like they are offering in other countries.”

So, would establishing an international price index actually work to lower drug prices?

The Trump administration projects that, in five years, using its IPI would save Medicare patients $3.4 billion. Policy analysts have argued that the amount patients would save is actually a bit murkier because many Medicare patients who use these drugs also have supplemental insurance. In addition, because so many countries — 24 in Europe alone — use this kind of indexing, there’s the risk of a circular effect, with everybody looking to their neighbor instead of basing the cost of the drug on concrete measures of the medicine’s clinical value or the costs of developing and producing it.

In Canada, the government already uses international drug list prices in negotiations, and has recently made moves to go even further.

“The comparison of our list prices in Canada to the list prices in other countries has proven to be not very effective at controlling the real price of medicines in this country,” says Steve Morgan, a professor of health policy at the University of British Columbia. One reason for that, he says, is that list prices don’t reflect real prices after drugmaker rebates. So now, he says, “Canada is trying to implement further price regulations that would make sure that the final negotiated prices are reasonable.”

In the United States, many Republican lawmakers and conservative groups have opposed the idea of an international index — arguing that it runs against free market principles.

Unsurprisingly, drugmakers also object. “Speaker Pelosi’s radical plan would end the current market-based system that has made the United States the global leader in developing innovative, lifesaving treatments and cures,” Stephen Ubl, CEO of lobbying group PhRMA, says in a written statement. “We do not need to blow up the current system to make medicines more affordable.”

But Pelosi and her allies seem to be betting there is political will to go against drugmakers this time. Despite the huge sums spent on lobbying, the pharmaceutical industry is now the most unpopular industry in the country, according to a recent Gallup poll. And with a presidential election coming up, Americans polled say lowering drug prices is a top priority.

This could mean there’s room for the House and the White House to work together, especially on an idea like an international price index that they’ve both proposed.

“We do hope to have White House buy-in,” Pelosi said Thursday. “That seems to be the route to getting any votes in the United States Senate, and certainly we want as strong a bipartisan vote as we can in the House and the Senate. So we would hope that they would support this.”

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In the first three months after getting his Dexcom continuous glucose monitor, Ric Peralta managed to reduce his average blood sugar level by three percentage points.

“It took me from not-very-well-managed blood sugar to something that was incredibly well managed,” says Peralta, a 46-year-old optician in Whittier, Calif., who was diagnosed with Type 1 diabetes in 2008.

Peralta was so enthused that he became a “Dexcom Warrior,” a sort of grassroots spokesman for the product. It became hard to imagine life without his new monitor, a device that lets him keep track the trends in his blood sugar 24 hours a day on his smart phone. And yet, he’s spent weeks at a time without the device over the past year because of problems with insurance restrictions. Physician groups and patients consider those rules overly burdensome, but insurance groups defend them as necessary.

Diabetes activists and legislators have started to focus attention on the surging price of insulin, leading to legislative pushes, lawsuits and congressional hearings. But insulin isn’t the only thing people with Type 1 diabetes are struggling to get. Managing the condition requires other essential, often life-saving medical supplies. And patients frequently face hurdles in getting access to those supplies — hurdles put in place by insurance companies.

A life changing device

Peralta learned about the Dexcom continuous glucose monitor from the mother of one of his patients. He visited the company’s website and, within two weeks, the device had been shipped to his front door.

“I still didn’t 100 percent appreciate exactly how it was going to change my life,” Peralta says. “It was amazing.”

Typically, people with Type 1 diabetes check their blood sugar by drawing a drop of blood from their finger and placing it on a disposable test strip that’s read by a blood glucose meter. Doctors suggest checking blood sugar this way between four and 10 times per day. These readings are crucial for helping people with diabetes manage their blood sugar — keeping it from getting too low, which can lead to sudden seizures and loss of consciousness, as well as from getting too high, which can cause vision loss, nerve damage and can even, over time, lead to amputations.

Instead, Peralta’s continuous glucose monitor gave accurate blood sugar readings every five minutes. That’s 288 readings per day, or about 278 more readings than even the most conscientious patients get the old-fashioned way.

“When I had to do the old-fashioned finger prick test, I was only doing that right before I ate, so I could see how much [insulin] I was supposed to take,” Peralta says. (People with Type 1 diabetes have to take multiple daily shots of insulin to keep their blood sugar within normal range because their bodies stop producing the naturally occurring hormone.)

“I didn’t realize that I had rather severe [blood sugar] peaks and valleys in between my meal times,” Peralta says.

Tighter control of blood sugar can reduce the risk of heart disease, kidney failure and nerve damage. For Peralta, it also offered peace of mind.

The monitor sounds an alarm when his blood sugar is getting dangerously low; Peralta says his coworkers have started bringing him sugary snacks when they hear the alarm, to help him raise his blood sugar back up to normal. When he takes his family on road trips — a favorite activity — he no longer has to worry about the possibility of passing out while he’s driving.

“It even syncs with my car so I can just say, ‘Siri, what’s my blood sugar?’ And it will come over the car stereo system,” Peralta says. “I’m safe for my family.”

Prior-authorization requirements

When common chronic conditions such as diabetes are well controlled, it prevents worsening disease and saves money for the health system and the patient.

But Peralta says his efforts to use this new tool consistently to manage his diabetes have been stymied by insurance problems that began about a year ago.

The newest Dexcom continuous glucose monitor has three parts: a sensor that measures glucose levels, a transmitter that sends out the sensor’s readings wirelessly, and a receiver that displays those readings on a screen.

For each of these parts, Peralta needs something called a “prior authorization” from his insurer — a requirement from his insurance company that necessitates his physician seeking approval from the insurance company before prescribing the device.

The Dexcom sensors last about 10 days each and Peralta’s insurance allows him to buy a three-month supply at a time. But he also has to get prior authorization for each supply, meaning every three months his doctor needs to reconfirm with his insurance company that the sensors are medically necessary. Same goes for the device’s transmitters — which last about six months each.

“I have to jump through hoops and they have to jump through hoops to get information from my insurance to get authorization,” Peralta says in frustration, adding, “for the last year, basically every time there’s been something that’s gone wrong.”

“Prior authorizations are in place to protect patients, to improve safety and to try to make sure that the care they receive is as safe as possible and also as affordable as possible,” says Kate Berry of the trade group America’s Health Insurance Programs.

But to Ric Peralta, the requirement is a burden.

The most recent snafu happened in March. Peralta ordered a new supply of sensors directly from Dexcom but says the company submitted a request for approval of a new transmitter, as well. And because his insurance approves the sensors and transmitters on different authorization timelines, the whole claim was denied. Peralta estimates he spent four hours on the phone with Dexcom and his insurer over the next month and a half to sort it all out. During that time he had to revert to finger stick tests.

“It’s maddening,” Peralta says. “If I do not have my proper management of this disease I’m going to die from it. And they’re making it as difficult as possible.”

A burden on doctors, too

Prior authorizations have become a major concern of physicians across the U.S. health care system, as evidenced by a December 2018 survey by the American Medical Association.

Of the 1,000 physicians surveyed, 91 percent said prior authorizations “have a negative impact on patient clinical outcomes;” 75 percent said the requirements “can at least sometimes lead to patients abandoning a recommended course of treatment;” and 28 percent said the prior authorization process had “led to serious or life-threatening events” for their patients.

“In my practice we have five individual physicians, and we hired five full-time employees whose primary duty is obtaining prior authorization and dealing with insurance companies,” says Dr. Bruce Scott, an otolaryngologist from Kentucky and Vice Speaker of the AMA House of Delegates.

“Prior authorization is a burden on providers and diverts valuable resources,” Scott says. “That’s a problem.”

The AMA has even created a website that catalogs stories of patients and providers who say they’ve struggled to gain access to important medical products and procedures because of problems getting prior authorizations from insurers — everything from pain medication for a cancer patient to X-rays in the ER. Scott says the AMA doesn’t expect insurers to completely do away with requirements for prior authorization, “but we believe that it should be focused and that it should be better planned.”

The American Association of Clinical Endocrinologists — an organization of the physicians whose specialty is often associated with diabetes treatment — goes even further.

“We feel that physicians that are specialists in endocrine disease should not be required to fill out prior authorizations for endocrine treatments,” says Dr. Scott Isaacs, an endocrinologist from Atlanta and member of the board of directors of AACE.

“It’s a huge burden for the patients trying to get this sorted out. Sometimes it’s red tape; sometimes it’s a true denial,” Isaacs says. “It’s a huge burden for the doctors as well, and the doctors resent it.”

Berry, of the insurance group AHIP, acknowledges that there’s room for improvement in the prior authorization process. In fact, in January 2018, the AMA and AHIP signed a consensus statement identifying five areas for improvement. It was cosigned by the American Hospital Association, the American Pharmacists Association, the Blue Cross Blue Shield Association and the Medical Group Management Association.

Who bears the greatest burden?

For Ric Peralta, the ultimate burden of getting all these prescriptions filled falls on him and patients like him.

After his latest mix-up with the sensors in March, he discovered the battery in his transmitter had died.

Peralta made another frustrated call to Dexcom, and recently got a complimentary transmitter to get him back on the system while his formal order goes through the approval process.

“I’m quite nervous about what’s going to happen again in two months when I am needing to call in orders again,” Peralta says.

“Am I going to have to go through this whole thing over again?”

This story is part of NPR’s reporting partnership with Kaiser Health News. Bram Sable-Smith is a freelance reporter based in Madison, Wisc., who often covers health care. Reach him on Twitter: @besables.

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Austin is about to become the first city in the U.S. to fund groups that help women who seek abortions pay for related logistical costs, such as a babysitter, a hotel room or transportation.

The move is an effort to push back against a new Texas law that went into effect Sept. 1. The state law bans local governments from giving money to groups that provide abortions — even if that money doesn’t pay for the actual procedure.

Last week, the Austin City Council approved a line item for the city’s latest budget that, as of Oct. 1, sets aside $150,000 to pass along to nonprofits led by abortion rights activists that provide “logistical support services” for low-income women in the city.

Supporters of the new city budget item describe it as a unique workaround to the state’s law, because none of these groups actually provide abortions.

“The city has to find creative ways to help vulnerable communities in our city, and I see this as just another way,” says Councilwoman Delia Garza, Austin’s mayor pro tem.

John Seago, the legislative director for Texas Right to Life, says that though Austin is not violating the letter of the state law, its leaders are clearly violating “the principle” behind it.

“The Legislature did not believe that it is ethical to use taxpayer dollars to benefit the abortion industry,” Seago says. “So whether it is the clinic itself, whether it is paying for the procedure itself, there is an industry built around that that we don’t want to use taxpayer dollars to benefit.”

Shortly after the city’s budget was passed last week, former Austin Councilman Don Zimmerman sued the city in an effort to block the funding. In his lawsuit, filed in a Travis County district court, Zimmerman claimed “this expenditure of taxpayer money violates the state’s abortion laws.”

Supporters of Austin’s effort say the budget item is on solid legal ground. They also say it’s an important step in ensuring that low-income women, at least locally, can obtain legal abortions in a state that has been steadily scaling back access to the procedure in the past decade.

Erika Galindo, an organizer with the Lilith Fund, told the Austin City Council during a meeting this summer that Austin should take a stand as some cities pass all-out bans on abortion. In fact, earlier in the summer, Waskom — a small city in East Texas — banned the procedure and declared itself the state’s first “sanctuary city for the unborn.”

“The city of Austin has an opportunity to set a new standard for creative and equitable solutions for communities at a time when state lawmakers and local governments like Waskom’s city council have turned their backs on low-wage workers and women of color,” Galindo said.

Austin’s city leaders say the makeup of their city council also likely played a small role in the decision to fund these programs. While Waskom’s ban was passed by an all-male council, Austin’s majority-female city council decided to take a different approach.

“I don’t think it’s any coincidence that you have a majority-female council making these kinds of issues a priority,” Garza says. “We have seen how this right has been chipped away at — all kinds of barriers being placed in front of women who are simply seeking an option that is still a constitutional right in this country.”

The city’s leaders and staff are still working out how women will qualify for the money and what groups to contract with, but it’s expected that some groups that are already doing this work across the state will be getting city support.

Among those groups is Fund Texas Choice, a statewide nonprofit group that provides travel arrangements for abortion appointments for women in Texas who can’t afford them. Sarah Lopez, an organizer with the group, says the group’s help can include providing women with gas money, bus tickets or ride-shares — and sometimes a hotel room to recuperate in.

More often than not, Lopez says, she’s helping women who are already parents and who can barely afford the procedure itself — let alone all the costs that come with actually making it to the appointment. For many of these women, she says, just a little help goes a long way.

“I was chatting with someone yesterday,” Lopez says. “She had just made her appointment but then rescheduled because she was like, ‘Oh, I didn’t realize I would have to be gone for three or four days — so I had to push my appointment another week and a half in order to find child care.’ ” (Texas law requires at least two office visits before a woman can get an abortion. And women living in rural parts of the state often have to travel 200 miles away, or more, to the closest abortion clinic.)

The groups that facilitate such support won’t be able to use Austin’s allocated funds for women who reside outside the city, though. And in Texas, travel barriers are even bigger outside major cities.

In 2013, Texas lawmakers passed a controversial law that imposed strict restrictions on abortion providers in the state. That law, known as House Bill 2, required clinics to be equipped and staffed like surgical centers, and it required doctors who provide abortions to have admitting privileges at a nearby hospital. Following that law’s passage, many clinics around the state shut their doors.

Even though the U.S. Supreme Court eventually struck down those restrictions, many of these clinics have yet to reopen – especially the clinics that closed in rural parts of Texas.

Despite Austin’s new plan, women living in parts of the state that don’t have a clinic will still have to rely on statewide programs such as the one run by Lopez’s group — and such programs have limited budgets. Still, Lopez says, Austin’s effort does take some of the pressure off such groups financially and frees up more money for women living in rural areas.

“I think it’s incredible,” Lopez says of the Austin decision. “I really hope to see that other cities in Texas kind of follow suit.”

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It used to take at least nine months for a patient to schedule an initial appointment with a psychiatrist at Meridian Health Services in Indiana. Now, it takes days, thanks to a program that allows doctors to connect over the Internet with patients, reaching those even in remotest corners of the state.

That has also helped with recruitment. Over the last several years, Meridian’s staff of psychiatric specialists, including nurse practitioners, tripled from four to 12.

“In my opinion, it’s lifesaving,” says Dr. Sarfraz Khan, Meridian’s chief medical officer. Meridian increased its investment in telepsychiatry in the last six months, in part because of what Khan says is a burgeoning addiction crisis. “There are drugs and then more drugs and then more and more drugs.”

Growing problems with addiction and depression have made the country’s shortage of mental health professionals much more acute for rural areas. Geographic isolation exacerbates a vicious cycle. A shortage of doctors means patients can’t get timely care. The health system atrophies, and doctor recruitment gets even tougher.

As a potential workaround, telemedicine is one of the most promising and lucrative opportunities in healthcare. The way it has transformed both psychiatric care and recruitment for Meridian is a case study of its appeal.

“There was a time when we were seriously considering: Would it be viable for us to provide psychiatric services because nobody would like to come to small towns?” Khan says.

Now, such care is readily available. And it makes more money for Meridian, a provider of mental health and primary care, because Medicare and Medicaid pay more for care provided to underserved areas.

Meridian set up what it calls a “hive” in Indianapolis, where it’s easier to recruit talent. Patients drive to a local Meridian office, where a nurse measures their vitals and observes their demeanor, and sits them in front of a computer. On a split screen, the physician appears at the other end of a secure connection.

Patients seem to embrace it.

At Meridian’s offices in Muncie, Mariah, a visually arresting 20-year-old woman emerges from her first telepsychiatry appointment. She wears a metallic kitty-ear headband over a florescent green wig that matches her dramatic eye shadow.

“Yesterday, I had heart-shaped freckles that were like colored glitter, and it also looked like I was crying glitter,” she explains.

Elaborate costumes help her mask a years-long struggle with depression and anxiety, says Mariah, who declined to use her last time to protect her medical privacy.

She says she prefers talking over a computer to an in-person appointment, because it feels less confrontational. “It’s easier because they’re not there, so I feel like I can tell more, and speak more and truly just be fully real,” she says. “If they’re sitting right there, I might not want to say everything or say as much.”

For all its benefits, telemedicine hasn’t solved all of Meridian’s recruitment needs.

“In my offices, I’ve got probably close to 50 positions that are vacant,” says Gerard Cyranowski, one of the company’s vice presidents covering the eastern part of Indiana. “It’s a tight labor market, there’s a limited number of practitioners. They can name their price.”

So Cyranowski says the company is interested in expanding its use of telemedicine to address staffing challenges in other areas, including primary care and psychotherapy. In the past few months, Meridian has been using it to treat patients in emergency rooms, addiction treatment centers and even schools.

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