After COVID-19, $250 billion in care could shift to telehealth

Tanya Albert Henry , Contributing News Writer

What’s the news: The COVID-19 pandemic propelled patients and physicians to quickly adopt telehealth and going forward the virtual visits could potentially account for $250 billion, or about 20%, of what Medicare, Medicaid and commercial insurers spend on outpatient, office and home health visits, according to a new report.

AMA Digital Health Study, 2019

Explore insights from the AMA’s updated study on physicians’ motivations and requirement for adopting digital clinical tools.

Before COVID-19 shut down the United States, telehealth accounted for an estimated $3 billion, according to a May 29 report from McKinsey & Company Health Care Systems & Services, “Telehealth: A quarter-trillion-dollar post-COVID-19 reality?”

Physicians and other health professionals are now seeing 50 to 175 times the number of patients via telehealth than they did before the pandemic. The report notes that 46% of patients are now using telehealth to replace canceled in-person visits, up from the just 11% of patients who used telehealth in 2019.

The shift will continue post-pandemic, meaning that “new ways of working for a broad set of providers, step-change improvements in information exchange and broadening access and integration of technology” will be required, says the report.

Why it’s important: Working now to ensure telehealth continues even when more in-person visits are allowed is important because telehealth can improve convenience and access to care and lead to better patient outcomes and a more efficient health care system, the report’s authors say.

The momentum is there: 57% of providers view telehealth more favorably than before COVID-19 and 64% report that they are more comfortable using it, according to McKinsey & Company surveys. And with the Centers for Medicare & Medicaid Services (CMS) temporarily allowing more than 80 new services to be conducted via telehealth, consumers’ preferences for telehealth could become more deeply embedded into the care delivery system while the nation continues to social distance during this health emergency.

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Authors identified five models for virtual or virtually enabled nonacute care: on-demand virtual urgent care, virtual office visits, near-virtual office visits, virtual home health services and tech-enabled home medication administration.

By shifting this care to telehealth, the authors estimated that:

  • 20% of all emergency room visits could be avoided.
  • 24% of health care office visits and outpatient volume could be delivered virtually and an additional 9% delivered “near-virtually.”
  • 35% of regular home health attendant services could be virtualized.
  • 2% of all outpatient volume could be shifted to the home setting, with tech-enabled medical administration.

However, physicians are still concerned about security, workflow integration, the future for telehealth reimbursement and effectiveness of telehealth visits compared to in-person visits. Also, surveys show a gap between consumer interest in telehealth and actual usage: 76% of people are interested in telehealth, but just 46% of people have actually used it. The gap may mean people are unaware of telehealth availability or may need more education about what care can be provided virtually, the report says. Insurance coverage may also be driving the gap.

The report outlines steps health care stakeholders can take now to ensure telehealth continues after the pandemic is over. These include:

  • Accelerating development of an overall consumer-integrated “front door.”
  • Segmenting patient populations, for example with specific chronic disease, and specialties whose remote Interactions could be scaled with home-based diagnostics and equipment.
  • Building the capabilities and incentives of the clinician workforce to support virtual care.
  • Measuring the value of virtual care by quantifying clinical outcomes.
  • Considering strategies and rationale to go beyond telehealth/clinic visit replacement to drive growth in new markets and populations and scale other applications.

Learn more: The AMA’s Telehealth Implementation Playbook walks physicians through a 12-step process to implement real-time audio and visual visits between a clinician and a patient. It is a powerful resource for practices now and as they continue to implement telehealth beyond the pandemic.

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The CARES Act: AMA COVID-19 pandemic telehealth fact sheet helps physicians understand new policies designed to help them and hospitals during the pandemic, including Medicare covering an expanded array of telehealth services and audio-only telephone visits.

And you can stay up to speed on the AMA’s COVID-19 advocacy efforts and track the fast-moving pandemic with the AMA's COVID-19 resource center, which offers a library of the most up-to-date resources from JAMA Network™, the CDC, and the World Health Organization.