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New York health plan to cover virtual reality therapy

Modern Healthcare

Brock E.W. Turner


AgeWell, a managed care organization for Medicare and Medicaid recipients based in Lake Success, New York, will begin covering virtual reality-based mental health therapies for members on its institutional special needs plan.

The plan covers individuals who are residents of long-term care facilities.

“[The] main focus is mental health,” said Amanda Thalmann, associate director of CareWell, the branded name for the institutional special needs plan that will cover the virtual reality therapy. 

The virtual reality therapy will focus on reducing the effects of isolation, improving communication with family members living far away, and increasing mental stimulation of patients suffering from neurocognitive disorders like Alzheimer’s disease.

While the deal shows promise, the total number of covered patients is small—around 200—and AgeWell isn’t committing to coverage beyond 2023. The organization purchased 12 to 15 headsets that will be distributed across its five contracted facilities.

AgeWell, which is using virtual reality devices from digital therapeutics company MyndVR, isn’t sharing additional financial terms of this arrangement.

Coverage for the services will fall under Medicare’s alternative therapies designation, which means AgeWell will reimburse without a designated code.

While Thalmann admitted many seniors are hesitant at first, she said the benefits can be tangible once they overcome hesitancy.

“I just think it’s going to be extremely beneficial for the overall wellbeing and quality of life of our seniors,” Thalmann said. “This is their home. They don’t get to go out and do things—this will give them the opportunity.”

Chris Brickler, co-founder and CEO at MyndVR , said more payers could begin to cover specific, limited uses of virtual reality within the next 18 months.

“There is a lot of momentum,” Brickler said. He pointed to a bill introduced with bipartisan support in Congress last year that would enable public payer coverage of prescription digital therapeutics, which could include virtual reality-based treatments in some situations.

Still, passage of that bill appears far off. In the meantime, partnerships of limited size and scope are likely to persist, experts say.

Rema Padman, professor of management science and healthcare informatics at Carnegie Mellon University, said while virtual reality has promise, its broad applications are still unknown.

“The question is: Is this technology really appropriate for wide dissemination, or is it really appropriate for niche kinds of deployment?” she said. “That is still not clear.”

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