Why Telehealth Is Real Now – The Value Equation

Everyone sees the obvious when it comes to telehealth.  The Stay at Home and Physical Distancing that’s come with COVID-19 has almost required telehealth.  What other option did healthcare organizations have?  Embrace telehealth or die?

However, I think that’s actually a little simplistic.  If we want to really understand what happened to make telehealth go mainstream overnight (see this great example of telehealth growth) we have to dig a little deeper into what happened.  Plus, understanding these details will be key to us being able to ensure that telehealth isn’t just a flash in the pan effort that goes away as we’re able to finally return to offices and hospitals.

To understand this, we have to look at why telehealth wasn’t being more widely adopted in healthcare.  From the patient perspective, telehealth often made so much since.  I don’t know anyone who wouldn’t rather wait in their house than in a medical waiting room.  Not to mention the commute.  Not to mention finding parking in many places.  Not to mention the risk of infection.  Not to mention parents who have multiple kids.  As much fun as it was to sit in an exam room waiting for an hour with multiple children, I’ll be fine if I never have to do that again.

The list goes on and on.  One thing was clear.  Telehealth provided amazing value and benefits to patients.

Why then wasn’t telehealth just exploding before COVID-19 if it was such a benefit to patients?

We could dig into the screwed up healthcare system, but for now let’s just talk about the physician telehealth experience prior to COVID-19.

Did telehealth pay a doctor more or less than an in office visit?  Definitely not more, rarely the same, and generally less.

Did telehealth make the visit more convenient for a doctor?  No.

It’s not hard to see the value equation a doctor faced with telehealth prior to the coronavirus.  They’d have to do essentially the same amount of work as far as time spent with the patient, documentation requirements, etc and then they’d get paid less for doing it.  None of us would like to get paid less to do a job that was just as hard and possibly harder.  Not to mention it required doctors to learn a new workflow and a new way to interact and treat a patient.

The reason why telehealth never took off pre COVID-19 is obvious.  At a minimum we needed payment parity and then we could have had a more challenging conversation.  However, without payment parity, it really was a largely dead end discussion.  Even with payment parity there were a lot of uphill challenges to climb.

What changed with COVID-19?

What’s amazing is how quickly COVID-19 changed the value equation for doctors.  First, Medicare and some payers offered payment parity for telehealth services.  That helped the first barrier of getting paid.  Although, even that is a bit tenuous since not all payers have followed.  So, if there’s still some fear of getting paid, why do we still see telehealth adoption so high?

Telehealth adoption is so high because of the other major change to the value equation.  Telehealth provided doctors something they really valued: social distance from the risk of COVID-19 infection.  And if that wasn’t enough, the stay at home orders offered legal risks if you stayed open and did not adopt telehealth.

Now the telehealth value equation makes sense from a physician perspective.  Less risk of infection and avoid legal liability of staying open.  Those are things that doctors valued and so they have embraced telehealth.

What Does This Mean Going Forward?

The big question is what now and will telehealth continue going forward.  One thing is clear that most doctors now can’t use the argument that they aren’t sure how to use telehealth.  We’re also going to have nuanced discussions around when telehealth is appropriate and when it’s not which will be really important and healthy.  However, current telehealth use is demonstrating that telehealth is just as effective as an office visit in a large portion of cases.  In fact, it’s likely more effective in some cases.  Not the least of which is someone who needed care and didn’t want to go into the office.

The two pieces of the value equation mentioned above are going to be worth watching though.  First, how will doctors react once the risk of infection is less, the legal restrictions are gone, and they can go back to seeing patients in the office.  Will that piece of the value equation be gone, or will doctors continue to value as much physical distance as possible to ensure their own health?  Not to mention, to improve the health risk to their employees.

Second, what will happen with telehealth reimbursement.  Will payment parity rule?  Will it actually get even better?  Will the telehealth payment approach get even more sophisticated and include things like text message engagement that accomplishes the same thing as an office visit?  Watching the telehealth reimbursement landscape will be a great predictor on what the future of telehealth holds.

One other thing to consider in this value equation is the patient side. Will patient have found telehealth so valuable that if you don’t offer them a telehealth option they’ll go somewhere else the way we did with banks that didn’t offer online services? Plus, even if doctors feel comfortable opening up their offices again, will patients be too afraid to return to the office for their own health risk that telehealth adoption will be driven by patients?

No doubt there are other nuances involved.  For example, how much do employers value things like telehealth which allow their employees to have more time at work and less time in a waiting room?  How does telehealth work in areas where there isn’t as much connectivity and device access?  Will the laws around medical licensure improve and be relaxed permanently so it doesn’t have to be done state to state?

While there are certainly still a lot of questions about telehealth, I think most of us think this genie is out of the bottle and it’s unlikely to go back in.  As patients, most of us are realizing the value of telehealth first hand and will push for telehealth to stay.  Hopefully, this value equation will help us understand what’s needed for telehealth to just become healthcare.  If not, it will be easy for healthcare organizations to slip back in to old habits.

About the author

John Lynn

John Lynn

John Lynn is the Founder of the HealthcareScene.com, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference, EXPO.health, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.

4 Comments

  • Great article, I enjoyed reading about the new technology. Would you be able to suggest a list of trending telehealth companies that I might be able to reach out? I am seeking a remote sales position in NYC.

    Thank you,
    Fern Zimbalist

  • Move to Televisit will upend the business model on which Walmart and CVS were building clinics. That was a game of scale (every corner) and convenience (no waiting in hallway, finding parking, etc.). Telehealth has infinite scale and multiple times convenience (when sick, I can consult from my bed).

  • Chinmay,
    Always great insights. This does beg the question of the future of retail health which is a big competitor to a telehealth visit. Going to be interesting to see if the patient mindset changes enough to understand when telehealth is sufficient or if they’ll still think they need the laying on of hands by the doctor.

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