Telehealth Version 1.0–Lots of Players, Little Differentiation
COVID-19 has forever changed primary healthcare delivery. To survive financially, physicians have had to quickly learn and implement telehealth solutions to deliver virtual care. The catalyst for implementing telehealth services was the Medicare 1135 waiver that reimbursed telehealth visits at the same rate as office visits[1]. This waiver was created to ensure patients would not be needlessly exposed to COVID-19 during an office visit.
The new CMS reimbursement guidelines opened the payment floodgates. Currently, there are over 260 telehealth vendors[2]. This high number of vendors manifests the low barriers of entry to creating a solution in this market. Further confounding the market is the high market value placed on the Teladoc Health-Livongo merger[3]. How can the merger of two companies with negative EBITDA values be worth a combined $37 billion? What differentiates Teladoc Health’s solution from the other telehealth solutions beyond the vendor’s first-mover market advantage? The telehealth market will be extremely competitive, and several companies will advance to compete for market leadership flush with investor cash. The success of this merger will also be challenged by the EHR vendors who are extending their portfolios to include telehealth capabilities[4]. The other key question is how easy is it to replace telehealth solutions? If an organization implemented telehealth for the COVID-19 emergency, will it replace those products with solutions provided by their EHR vendors or more robust solutions?
Telehealth That Is Flexible and Extendable
As the healthcare organizations move forward with implementing virtual healthcare delivery service models, the ability of the telehealth platform to extend these services across socioeconomic environments of patient populations will be critical for long-term success. If patients do not have the internet or smartphones, how will telehealth services be provided? One emerging solution is to use televisions[5]. In some areas, cable companies will begin to convert their cable boxes into smart home devices that compete with Amazon’s Alexa or Google Home. Telehealth companies that can easily integrate their platforms into the smart home devices with FHIR APIs are likely to become market leaders.
Telehealth solutions’ ability to integrate a range of disease management guidelines to share with virtual care patients so they can more effectively manage their own care will also differentiate these products. The ability to use disease management content from respected sources such as Mayo Clinic, WebMD, Cleveland Clinic, and others delivers the flexibility that most providers desire as they develop their virtual care services.
Remote patient monitoring will be needed by telehealth solutions to establish a treatment environment that is equivocal to in-clinic visits. Capturing key vital signs such as blood pressure, pulse, pulse oximetry results, weight, and temperature before, during, and after the telehealth encounters will enable more effective provider management of the patient. Smartwatches are also emerging that can collect several key vital sign measures as well as EKG tracings[6] that can be shared via Bluetooth connections with telehealth and EHR solutions.
Telehealth is the Foundation for Patient-Focused Care
Patients will not likely revert to the primary care model where they must travel to physician clinics to receive their care in most cases. Recent survey results showed that nearly three quarters of patient who experience telehealth services were highly satisfied[7]. Healthcare organizations that design telehealth services to integrate with EHR and population health management applications will improve care coordination and outcomes. Telehealth services will need to be integrated into patient access platforms for scheduling the service as well as registration functions for identifying insurance and pertinent demographic information. These patient access functions should be a component of patient portals to further enhance the virtual care experience.
Established and Emerging Vendors Compete in an Immature Market
While the Teladoc Health-Livongo merger is front and center now, key competitors will come from EHRs, telecommunications, and technology companies:
Large technology and telecommunications vendors have the capital and market reach to become dominant players in the telehealth market. But nonhealthcare focused companies have struggled in the past to provide well-supported and well-designed healthcare products.
Success Factors
Summary
The US telehealth market is immature and constitutes a high risk for both providers and vendors. It is relatively easy to create a HIPAA-compliant audiovisual solution that can support provider-patient healthcare encounters. COVID-19 and relaxed reimbursement regulations for telehealth resulted in many provider organizations implementing products that may not be good long-term solutions. If this is true, the market will experience a high degree of telehealth replacement activity over the next year. Solutions offered by telecommunications, technology, EHR, and audiovisual conference vendors will create a highly competitive market for providers to evaluate for their next version of telehealth. Telehealth vendors that can extend their solutions via integration with smart home devices and remote patient monitoring devices will be best positioned to optimize telehealth services for providers. First-mover market advantage for some telehealth vendors will not be a competitive barrier to the well capitalized and technologically advanced competitors that are emerging.
[1] https://www.cms.gov/newsroom/fact-sheets/medicare-telemedicine-health-care-provider-fact-sheet
[2] https://www.beckershospitalreview.com/lists/260-telehealth-companies-to-know-2020.html
[3] https://www.businessinsider.com/teladoc-livongo-merge-185-billion-dollar-deal-2020-8#
[4] https://www.healthcareitnews.com/news/epic-launches-new-telehealth-service-twilio
[5] https://www.healthcarefinancenews.com/news/new-telehealth-technology-uses-tv-set
[6] https://www.cnet.com/health/what-is-ekg/
[7] https://patientengagementhit.com/news/telehealth-patient-satisfaction-high-paves-path-for-future-access
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