Telehealth Visits Can Improve Revenue, But They’re No Cornucopia
In the Spring of 2020, a number of institutions—health, education, judicial, and others—went through a wrenching technological transformation: To prevent the spread of COVID-19, they took refuge online. Clinical sites that had long ignored the appeals of telehealth advocates suddenly adopted virtual visits. The change took place in almost a twinkling of an eye.
What if the trumpet shall sound? Specifically, what if the Center for Medicare & Medicaid Services (CMS) rescinds the emergency orders it has put in place during the COVID-19 pandemic? More generally, how have televisits affected clinicians’ revenues, and how is the effect likely to change?
I talked to a number of health IT and telehealth experts in a search for answers to these questions. Most are bullish on televisits, believing that these visits have firmly established themselves, are popular with clinicians, patients, and payers alike, and will only grow over time.
And yet some observers, including the editor of this site, John Lynn, harbor worries. Until the CMS’s emergency televisit regulations are canonized by Congress into law, we’ll never know what direction they’ll take. CMS did promise to give 60 days’ notice before making changes. Kimberly Hartsfield (Executive Vice President, Growth Enablement at VisiQuate, Inc.) says that Congress recently permitted another two years of reimbursed televisits. The American Telemedicine Association maintains a US bills related to telemedicine and their status.
Actually, the prevalence of televisits is less than it seemed to many of us. At the height of the pandemic, the use of telehealth reached just 13% of outpatient visits.
This article focuses on revenue, because I and other writers frequently cover impacts of televisits on access and care plans. (Still, I haven’t been able to hold back from some other related observations.) What I found is that televisits don’t seem to make a big difference, either positive or negative, on the money clinicians are making. As usual, sites that are already flush with cash and well-endowed with resources can find more cost savings.
How televisits improve clinical revenues
Obviously, televisits saved the health care system from collapse when COVID-19 was first recognized as a major threat. But as we return to a fragile but long-awaited environment where most people are ready for dinner parties, live concerts, and office visits, we can identify some ways televisits help clinicians bring in more money.
- More appointments kept. When patients don’t have to worry about transportation, leaving work for half a day, finding child care, or even getting out of their pajamas, they are more likely to come to their appointments. This reduces waste and increases revenue.Hari Prasad, Founder and CEO of Yosi Health, which manages patient intake and management, points out that logistical problems are a major reason for missed appointments. (The health care field has traditionally called this problem “no shows,” but many experts now avoid the term because it implicitly places all the blame on the patient instead of surrounding circumstances.) Meanwhile, the improvements in attendance mean less downtime for doctors.This finding in health care matches what happened when court systems had to go online at the onset of COVID-19. Thousands of stressed defendants and litigants could attend hearings they would otherwise have missed. But it’s important to note that going online was often detrimental to building trust and understanding in the court system, a risk we have to look out for in telehealth too.
- Improved workflows. Increases in kept appointments are just one example. Reeya Patel, Vice President of Healthcare Insights at Azalea Health, points out that a televisit can document that a follow-up appointment has been scheduled, a request for a medication took place, or a referral to a specialist has occurred, all for billing purposes. Another company says that allows patients to schedule visits faster.
- Reduced need for office space. Not only physicians can spend some time away from the office; so can support staff. Tim Costantino, VP, Head of Product at AdvancedMD, points out that a support staff person can work remotely for multiple office locations at a time, boosting efficiency and productivity.
- Packing more billable work into doctors’ time. This idea was cited by Dr. Ali Parsa, who is CEO and Founder of Babylon, an AI-based analytcs company in health. In our mostly fee-for-service model, visits are still what doctors get paid for. By saving time, telehealth allows the doctor to fit more patients into the week.Several respondents said that televisits would bring more people into the health care system, especially mental health patients. Access to providers in other parts of the country is particularly important for rural patients, as is the ability to hold a conversation without neighbors finding out.Besides providing relief to people who never had care before, the recruitment of new populations means more potential revenue. Robin Wiener, President of Get Real Health, called televisits a “digital front door” for new patients.
We should note, though, that telehealth did not lead to increased visits overall. In short, health care revenues didn’t suffer from a negative impact by having patients use the health care system more.
The trade press confirms some of the experiences of the respondents I interviewed. One observer claims that telehealth can help triage, overcome staff shortages, and keep patients connected so they return for follow-ups. Another company manger cites increased access, more convenience, and lower readmissions.
Patel has seen that the benefits of telehealth, including its potential cost savings, work better for large and well-funded clinical settings. These settings have more IT staff with more technical sophistication and freedom in their schedules to explore how new practices and technologies can make operations more efficient. Richard Daley, CEO of Sunwave Health, says that 15-20% of providers are “savvy” about analytics and are seeking better ones.
A country conundrum
Televisits benefit rural residents far more than urban residents. Not only is transportation more difficult in rural areas, but often there’s no specialist to be had anywhere nearby. Despite this appeal, televisits are increasing at a faster rate among urban-dwellers than rural ones. The study citing this result reasons, “Lower telehealth use by rural beneficiaries may be due to limitations in broadband access and challenges with Internet availability and affordability.”
Remote patient monitoring
The premise of this article embraces an irony. For several decades, health care reformers have been advocating “fee for value” or value-based care, which supposedly rewards long-term results instead of individual encounters. If the U.S. had adopted value-based care, it wouldn’t matter whether you saw your doctor in the office, online, or in the bleachers of Beaver Stadium.
But at least one type of value-based care is getting reimbursed: digital monitoring for behavioral care. I talked to Rick Anderson, president of Dario, which provides the basics of connected health—monitoring of health data and behaviors, messages to patients, and so forth—while deriving revenue from employers and other private payers.
Medicare created new codes to cover remote patient monitoring in January 2020, according to Anderson and Null. These codes were unrelated to the COVID-19 pandemic, which had just begun to emerge. It’s too early to tell the impact of the new codes.
Monitoring provides a “force multiplier” (in Anderson’s words) to doctors’ work. These interventions allow clinical settings to be reimbursed for work done by nutritionists and other staff under the doctor’s supervision. Furthermore, doctor visits can be much more productive when the patient and doctor are both conscious of the data being produced and when the patient feels a stronger connection to the clinical practice. As Hartsfield says, “Patient engagement strategies have never been more critical.”
How does all this relate to revenue, the topic of this article? Digital delivery of connected care allows services like Dario to provide a huge amount of data to the payers who fund their service. Data ranges from patient engagement to changes to “time in range” for people with diabetes. Using this data, payers can verify that their investment in RPM pays off by reducing other costs.
A boon for behavioral health
In economically affluent countries, behavioral health is the key to achieving better health for the population as a whole, and lowering costs along the way. It’s therefore good to see that behavioral health, along with mental health interventions, are luckily burgeoning thanks to telehealth. A government study finds, “…beneficiaries used telehealth for 43 percent of all behavioral health services they received during the first year of the pandemic. In contrast, they used telehealth for only 13 percent of all office visits they received during the first year of the pandemic.”
It’s well known that need has increased alarmingly during the pandemic as behavioral problems and mental health generally worsened.
To explain why I’m devoting a special section of this article to behavioral health, I must digress into a discussion of health care costs. In the opinion of many experts, the reason U.S. health care costs continue to rise unsustainably is that our clinicians and public health systems have not successfully altered unhealthy behaviors in the population. We haven’t guided people toward better diets, regular exercise, better sleep habits, less drug and alcohol use, more social contact—and may I add a more balanced consumption of media and social media? Fewer Americans use tobacco now than in earlier generations, but the country is not making as much progress as we need.
So we have a lot of people with either serious disease of costly health conditions eventually leading to disease. An aging population exacerbates the cost problem, as cited by Tina Null, a nurse who is Chief Clinical Officer of Anelto. Just as bad for health is the increasing stress and precariousness of life experienced by many people. Steps toward universal insurance coverage are valuable and compassionate, but underscore even more the importance of promoting behavior change among the new, often at-risk beneficiaries.
Back to telehealth. Behavioral health is the biggest and fastest-growing sector of telehealth. I don’t want to digress much into the clinical impacts of telehealth. But there are obvious benefits to combining remote patient monitoring with visits (in-person or virtual). That’s because behavior change depends on decisions that individuals make day by day and even minute by minute, so verifiable data combines with immediate feedback and emotional support to offer a potential that old-fashioned clinical visits couldn’t achieve.
Parsa points out that payers reimburse patients or practices for many devices used in the home, but these are an old generation of technology that is hard to install and use. Many newer technologies rely simply on software running on a mobile phone. Even though most of these monitoring programs are not reimbursed, they are so cheap that they can contribute to reducing the cost of treatment.
Daley said, “Demand for behavioral health continues to rise across all patient cohorts, including those who have historically been underserved and face barriers to care. These individuals may have trouble accessing and using the technology.” Still, he sees a growth in telehealth and a move from inpatient care and intensive output programs (IOP) to outpatient and at-home care.
The future of telehealth
Most of my respondents see an increasing role for televisits over the coming years. The advantages for clinicians could be seen throughout this article. Meanwhile, patients like the convenience and safety of online visits. Prasad cited studies finding that 80% of patients would continue to meet online.
And telehealth can be exploited by payers for cost savings as well. Both remote patient monitoring and televisits bring patient into health care earlier, leading to a quicker resolution of problems and lower costs for that patient over the long term.
One Massachusetts study called telehealth cost neutral and suggested that is actually added some costs. Ultimately, the study found small reductions to overall health care costs. The study looked at commercial insurance only, excluding Medicare or Medicaid. Examining the government programs could well turn up very different statistics, because they treat sicker and more at-risk populations.
Hartsfield believes that so long as Medicare continues coverage, so will other payers. However, she is one of the few people interviewed who think that payers will reduce reimbursements rates.
The general position of health care institutions today seems to be an untenable balance between flood and drought. On the one hand, COVID-19 has combined with other health crises like opioid abuse to bring unprecedented stress on many hospitals. But on the other hand, many clinics and operating rooms are still not seeing enough traffic, Hartsfield says.
An Australian study finds that telehealth can improve outcomes but probably not lower costs.
In my assessment, telehealth is obviously a boon for the IT companies that spent years preparing for current conditions and who provide irreplaceable services to payers and clinicians. Payers can probably benefit financially from a smart use of remote monitoring and televisits. Clinicians will see less of this benefit in revenues. To reap more of it, they’ll need to employ a lot more analytics and use their insights to hone their workflows.