Has telehealth hit the high watermark?

In the immediate aftermath of the COVID-19 pandemic, health systems saw dramatic spikes in virtual visits and telehealth adoption in the patient population. The broad consensus is that the healthcare industry saw more telehealth visits in the one month immediately following the pandemic’s lockdown than in the entire year preceding it.

A study by non-profit group FAIR Health suggests a 4,000% increase in telehealth claims across the country in the first few months of the pandemic. Seattle-based Providence Health saw 70,000 patient logins and over one million messages come in through the chatbot in the first month of the outbreak or 10-15 times more than pre-pandemic levels. Danville, Pennsylvania-based Geisinger saw a 500% increase in telehealth visits in the first couple of weeks after the COVID-19 outbreak.

Technology firms such as Teladoc, Amwell, and Doctor on Demand which offer real-time video consulting and telehealth platforms have rushed to capitalize on unprecedented opportunities. Teladoc reported that total visits rose 92%, from 1,063,000 to 2,045,000 in the past quarter. Its competitor American Well has raised nearly $ 200 million to keep up with the “skyrocketing” demand for telemedicine, and Doctor on Demand collected $75 million for meeting the increased demand for its platform and services.

Digital health startups have also defied dire predictions about funding slowdowns, with data pointing to stronger-than-ever funding numbers in 2020, including aggressive M & A by public companies riding the wave of strong stock market performance. 

In my upcoming book on Healthcare Digital Transformation, co-authored with Ed Marx, former CIO of Cleveland Clinic, we discuss how the dramatic growth in telehealth could accelerate digital transformation in healthcare. 

What could go wrong with this picture?

A recent report by the Commonwealth Fund, based on a study conducted jointly by Harvard University and digital health company Phreesia, acknowledges that the COVID-19 pandemic has dramatically changed how outpatient care is delivered in health care practices.

However, the report adds that while ambulatory visits dropped by 60% in the immediate wake of the pandemic, more recent data shows a rebound in visits, especially as several states proceed to reopen their economies, and points out that there remains a “cumulative deficit” of 40% in ambulatory visits.

Most importantly, the report notes that telemedicine use has begun to decline since mid-April, which was likely the peak period of the pandemic-imposed lockdown.

In recent conversations with healthcare executives across the country, I hear the same story. The dramatic spikes in telehealth visits in March and April have dropped off, even as in-person visits have started climbing slowly in tandem with a gradual reopening of healthcare facilities across the country.

Dr. Ashish Atreja, chief innovation officer at Mt Sinai Hospitals in New York, believes we will see a variable pattern in telehealth visits. He suggests that some patients would still want to come into a clinic for their healthcare needs.

The challenge will be managing expectations from patients who have tasted telemedicine and who now demand a mixed approach to their care needs. Moreover, certain specialties are more suited for in-person visits than telemedicine, and as clinics and hospitals reopen, in-person visits will increase for those specialties. For instance, at one cancer care hospital, telehealth visits have dropped from 50% to 15% of the total visits in the past couple of months.

The sudden shift to increased telemedicine visits has also created new challenges related to the infrastructure required for successfully managing virtual visits. Some parts of the country, mainly rural and sparsely populated regions, don’t have adequate telecom infrastructure to ensure bandwidth needed for telehealth. In such cases, patients have no choice but to make in-person visits to the nearest clinic.

The problem isn’t restricted to rural areas alone – many inner-city residents often lack access to broadband infrastructure and, in some cases, can’t afford it, all of which create additional challenges for telehealth adoption.

A final concern for healthcare executives, especially CIOs, is that increased telehealth usage also increases cybersecurity risks as both caregivers and patients operate remotely in the new normal of the pandemic. 

Following the money

The ever-present uncertainties of healthcare reimbursement somewhat dampen the gung-ho rhetoric on telehealth. In a swift and welcome response to COVID-19, the CMS announced rules to improve telehealth reimbursements across the board.

CMS Administrator Seema Verma has since then made statements suggesting that telehealth waivers may be extended in the future. While this is good news for telehealth, the nuance is that while telehealth visits are reimbursed on par with in-person visits, other aspects, such as facilities reimbursements, have reduced, even though hospital fixed costs have not gone down. Many healthcare providers are, therefore, motivated to bring patients back into the hospital or clinic. 

The question of reimbursements also impacts another high-growth area in telehealth, namely remote patient monitoring. The pandemic has underscored the need to monitor the majority of patient populations that live with chronic conditions such as diabetes.

While the technology exists and there has been significant growth in remote care models, the reimbursement environment for remote monitoring programs is yet to evolve, leaving health systems, especially those operating in fee-for-service models, with limited options other than to have patients come into the clinic for their care needs.

COVID-19 has also significantly reduced the ability of health systems to invest in technologies and programs to shift to virtual care models. While the immediate aftermath of COVID-19 required health systems to implement real-time virtual consult capabilities, these pressures also reduced funding available for other programs.

As virtual visits taper off, the question remains whether telehealth has hit the high watermark or if we are moving towards a new normal defined by a mix of telemedicine and in-person care.

As with most such complex scenarios, the answer depends on the type of care. While many aspects of routine and urgent care may well shift significantly towards a virtual care model, others, such as oncology, may remain largely within the framework of in-person care.

Regardless, as technologies improve and as patients and caregivers alike become comfortable with online and virtual care models, telehealth is set to contribute to a significant portion of healthcare delivery in the future.

Paddy Padmanabhan is Founder and CEO of Damo Consulting, a growth strategy and digital transformation advisory firm that works with healthcare enterprises and global technology companies. He is the host of The Big Unlock, a podcast focusing on healthcare digital transformation and author of the book, The Big Unlock: Harnessing Data and Growing Digital Health Businesses in a Value-Based Era.