Our Take

Why providers must embrace telehealth now

20 Minute Read

Not all providers feel urgency to embrace virtual visits. And as long as the future reimbursement of telehealth remains unclear, that will continue. Many providers see telehealth as an imposition and have reverted to in-person visits as the default for care delivery. These providers ignore the opportunity costs of failing to meet new expectations for telehealth—and they risk making existing care delivery challenges worse.

Telehealth is a versatile suite of tools that can help solve care delivery problems. Providers must make progress now on integrating it into care delivery if they intend to have a hand in shaping the future of virtual care utilization—and reaping its benefits.

 

The conventional wisdom

Until the Covid-19 pandemic, providers had never faced significant opportunity costs for not embracing virtual visits. Reimbursement for virtual visits was unfavorable relative to in-person care. Many clinicians were unfamiliar with telehealth—some were actively hostile to it. And until Covid-19, patients were largely unaware of the potential to use virtual and remote technologies to connect with providers and manage their care.

Covid-19 has fundamentally altered these dynamics for telehealth, but many providers remain reluctant to make significant commitments until lingering reimbursement and policy uncertainties are resolved. Although the Centers for Medicare and Medicaid Services (CMS) have consistently signaled that a new approach to telehealth is coming, few details of that approach have emerged. CMS administrator Seema Verma has commented that “there’s absolutely no going back” to the way Medicare used telehealth before Covid-19. But she has also said that in-person care is the “gold standard,” and that reimbursement for in-person and virtual care is not a “one-to-one” relationship.

At the same time, many provider organizations are setting lofty goals for ongoing use of telehealth. Health care executives in the U.S. and abroad consistently tell Advisory Board researchers that they hope to shift 25% to as much as 60% of their patient interactions to telehealth. In many cases, those numbers are simply an aspirational response to the surge in telehealth demand and the possibilities offered by temporarily expanded reimbursement. The aggressive moves that providers have made in 2020 to shift patient interactions to virtual channels seem like overreactions to hype and fear rather than sound planning.

 

Our take

Many providers still don’t feel much urgency to invest strategically in telehealth, but they should. Failure to support telehealth now will have serious costs for providers, even if the outlook for reimbursement and policy is unclear. Expectations of patients, payers, and emerging competitors demand that provider organizations integrate telehealth into practice.

Patients see virtual visits as a way to solve their own access problems. Patient interest in virtual visits surged beyond pre-Covid-19 levels for every clinical scenario we tested in a recent consumer survey, including ongoing care, prescription refills, pre- and post-surgical appointments, and even receiving oncology test results. Patients also recognize that telehealth can get them care faster. Three out of five consumers in every age group would consider a virtual visit as an alternative to waiting just one day for an in-person appointment. However, consumers also indicate that they don’t want to connect with just any provider virtually; they want to connect with their own provider virtually.

Purchasers are willing to look beyond local providers for telehealth solutions, despite providers’ recent investments. Health plan reimbursement policies have held sway over the telehealth ambitions of many providers. In the meantime, health plans and employers are moving forward on partnerships with national telehealth vendors. Such arrangements often undercut providers’ own offerings on cost, thus leading patients away even though they want to stay with their own physicians. These trends will accelerate if providers continue to lack effective and integrated virtual care solutions.

Health plans and employers have traditionally worried that lowering barriers to access will lead to overutilization and higher costs. But most plans and employers also acknowledge that selective applications of telehealth can play an essential part in reducing the total cost of care. As plan members and employer purchasers increasingly demand telehealth services, providers who can’t offer virtual visits run the risk of unfavorable placement in provider search lists—and eventually exclusion from the network. Health plans will increasingly look to vendors to provide the kind of care management and steerage that ought to be providers’ strength.

Product Director Quote

Competitors are ready to take providers’ seat at the table. If providers want to build productive relationships with patients and plans while remaining at the center of patients’ care experiences, they must take proactive steps to maintain their position. Telehealth incumbents are moving beyond point solutions toward more integrated care offerings, as with Teladoc’s recent acquisition of Livongo.

If provider relationships with patients weaken, providers will be less attractive as partners to emerging players in telehealth and digital health. Vendors want partnerships with providers because they have traditionally been the key to connecting vendor products with patients. If that’s not true in the future, or even not as strongly true, then vendors will look for relationships with non-provider entities to inflect patient choices.

 

How providers can secure their place in telehealth’s future

Simply ramping up the number of virtual visits is not the answer to these forces—and it puts unnecessary pressures on clinicians and their workflows. Telehealth is one of the most versatile tools in care delivery. Providers should focus on identifying the care delivery problems that telehealth can help solve, rather than approaching telehealth as a problem in itself that needs to be solved.

The following tactics form a solid foundation on which providers can build solutions-oriented telehealth offerings that drive value for patients, clinicians, and payers.

  • Tactic

    Focus on how telehealth can help solve problems, not on how many visits to do

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  • Tactic

    Connect clinicians to the value of telehealth— don’t just train them on how to do virtual visits

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  • Tactic

    Guide patients to appropriate and productive use of virtual visits

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Parting thoughts

Reimbursement typically has dictated the scope of telehealth services that systems can provide, rather than being an outcome of a set of services that systems want to provide. This reality reinforces a long-standing perception among provider organizations that reimbursement is something that happens to them, rather than being a process that they can inflect.

The emerging opportunity for provider organizations is to capture as much data as possible about their use of telehealth. The recent surge in telehealth utilization generates more insight than ever about which patients and providers are using it, for what needs, and how that utilization impacts downstream interactions and outcomes. Such data is essential for both systems and payers in making decisions about appropriate care, clinical best practice, future investment, and reimbursement.

Covid-19 has clearly demonstrated the versatility of telehealth—including not only virtual visits but also remote patient monitoring and asynchronous modalities. Telehealth is not a problem for providers to solve; it is a new way for providers to solve care delivery problems at scale.

Consumers are already thinking of telehealth this way. Our recent survey of consumers indicates that their interest in telehealth has surged for opportunities to solve their own health care challenges, including getting faster access to care, making care more convenient, and connecting with their own physicians. Providers should follow their lead and focus on how to use telehealth to address their own strategic objectives.

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