Telehealth is here to stay. What about legacy healthcare providers?

Telehealth is here to stay. What about legacy healthcare providers?


Telehealth provides convenience to patients. It has the potential to improve patient outcomes by ensuring worrisome signs and symptoms are discussed with a clinician as quickly as possible. And it’s a lifeline during a pandemic for medically-vulnerable individuals who should not be going anywhere near other sick people.

It also has the potential to be a direct threat to brick-and-mortar healthcare providers, with their expensive buildings and corridors full of currently empty beds.

Both regulators and traditional healthcare delivery systems fought telehealth’s expansion for years. Covid’s arrival upended most of their arguments. It was a lifeline for patients and providers in the wake of offices shut down and direct in-person visits eliminated. And now that patients have experienced a world of office-free appointments, Covid’s departure will not put the genie back into the bottle.

Signs of telehealth’s accelerating momentum are everywhere. Walmart-owned Sam’s Club is partnering with telehealth provider 98point6 to offer members a subscription-based service. BestBuy Health and Amazon Alexa recently partnered to make a flip phone that could help seniors easily get in touch with clinicians. On its own, Amazon is gearing up to make its telemedicine platform, Amazon Care, available to consumers, too.

Unless they want to be permanently behind the curve, legacy healthcare organizations cannot waste time thinking creatively and strategically about how to incorporate telehealth into a fee-for-service model. We know telehealth doesn’t fit within a fee-for-service model. If it did, providers wouldn’t be calling for policy changes so that they may more easily integrate telehealth into their practice.

Too many healthcare executives are counting down the days to get back to ‘normal’— that is, in-person procedures and office visits. If the conceptual framework from which they’re operating is a traditional FFS model, then telehealth represents diminished revenue per ‘transaction.’ The more telehealth visits they perform, the less they make, and the more at risk they are in being able to fund their bricks and mortar. This is the world that most healthcare executives have known for over 30 years. Few can imagine an alternative in which they are paid on a capitation basis in a model where they are accountable for outcomes, but there are real risks to their inability to do so.

The most immediate business risk healthcare organizations run is shrinking revenues, and the potential continued loss of revenue needed to fuel an expensive bricks and mortar-based business model. Consumers seeking an answer to a question that might only take 5-10-minutes could decide to tap a different healthcare organization, or a nontraditional provider. Depending upon the cost and quality of that experience, they could be tempted to return many times over and ultimately abandon the practice they may have been visiting for years.

The good news is that many large delivery organizations are already in the accessible telehealth arena. In our most recent population health survey, more than three-quarters of the responding hospitals and health systems either offered their own telehealth programs or partnered with organizations that had them. But the pre-pandemic payment model inconsistencies stand as a formidable obstacle to using telehealth as a strategic asset. Reimbursement today for telehealth is generally at parity with in-person office visits, but that will be ending by the end of 2020, and it’s unclear what happens next. If reimbursement for telehealth reflects pre-pandemic levels, it will be a significant obstacle to utilization, especially for providers that are mostly FFS (which is most of them).

Realistically, risk-based payment models can be hard to get right, and healthcare providers can run into serious financial challenges if they miscalculate. In our survey, approximately 1 in 5 respondents cited the threat of financial loss as the primary barrier to moving to a risk-based model.

However, telehealth has the potential to take away some of the fear that often comes with implementing a risk- and market-based model. A market-based model holds providers accountable for outcomes by establishing transparency in cost and quality and tying payment to outcomes, and telehealth is a tool that can help ensure those outcomes are positive. Well beyond Covid-19, there are benefits to keeping relatively healthy people at home, and reserving in-person appointments only for those that demonstrate the need.

Telehealth offerings can also be a relatively low-risk way for providers to begin to provide healthcare services under capitated contracts, as consumers can access a range of entry-level services for a small monthly fee. The limited nature of the offering means the potential for downside risk from over-usage is not large. And the response providers get from consumers participating in these programs is useful, market-driven feedback.

Finally, telehealth provides a solution to the problem of physician burnout, which was an issue long before the current moment, though the addition seems to be pushing providers to their limits. Compared to a survey from two years ago, 45% more physicians report often or always feeling burned out.

Telehealth has the potential to actually ease physicians’ burdens. It would allow them to conveniently provide high-quality care in a safe, low-cost environment: the patients’ home. It would allow them potentially to see more patients per day; and it would allow providers to address patients’ issues with easy, convenient access, at lower cost and, with proper use, equal or better quality. And as a result, telehealth could actually increase hospitals’ bottom lines and meaningful engagement of consumers.

Telehealth is here to stay. The only question is whether today’s healthcare delivery organizations are as well.


This article was written by Rita Numerof from Forbes and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to

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