Teladoc: The doctor is… well not in but on
Covid-19 has caused disruption for industries across the board. Hospitality, education and airlines have been rocked by stay at home orders and fear of leaving one’s home. Perhaps the industry most disrupted for the better in the long term will be the industry at the very heart of covid, healthcare. Before covid, healthcare companies were notorious for being slow to move and adopt digital technology. Much of this resistance can be tied to regulation hampering incentives to offer more digital solutions and telehealth visit options. Prior to covid, Medicare provisions stated that patients had to be in a remote or rural coverage area for telehealth to be reimbursed and typically were restricted to telehealth visits from predetermined hospital or clinic sites. In a post covid world, Medicare covers all telehealth visits from any location and allows for visits with new or established patients. While some changes may prove temporary and regulation may move to create more structure in the future, most experts agree telehealth is here to stay as a large portion of how care will be delivered in the future.
In the wake of these regulation changes and providers scrambling to set up infrastructure to talk with patients, many companies have emerged to offer connection to patients. Established telehealth companies such as Amwell and eClinical works have enhanced their product offerings while newer entrants into telehealth such as Zoom and Microsoft Teams have also works to grab share. However, the clearest winner in the battle for telehealth dominance is Teladoc. Teladoc was founded in 2002 with the purpose of increasing patient access and experienced steady growth and improvements until they went public in 2015. In the last four years their stock has seen a dramatic growth 4,700% growth ending in late January. How have they distinguished themselves among the crowd other than their early mover advantage and name recognition in covid? They have prepared themselves well for a telehealth forward future by not simply positioning themselves as a way to video consult with your existing physicians but as a one stop shop for all customers looking for a digital engagement with a provider. Teladoc provides not only primary care appointments but the ability to quickly connect with therapists, dermatologists and other specialists. When considering cost, many insurance plans now cover visits and without insurance a visit is a relatively low $75 vs the hundreds that may be spent for a visit to an ER or Urgent Care.
Further proof of Teladoc’s positioning to be a winner both in and after covid is through their purchases of Livongo and Better Help. Better Help was acquired in 2015 with the aim of enhancingTeladoc’s mental health care offerings and access to therapists. Furthermore, Teladoc acquired Livongo in October of 2020 to add skills and specialties in diabetes management and care coaching. These acquisitions show a clear strategy and ability to execute on being a telehealth leader well past covid.
The advantages of telemedicine are clear and due to covid-19 some of the main barriers like regulations, costs, and resistance to adoption are significantly lower. It would be interesting to see how the momentum carries on in a post pandemic world and if Covid was indeed the catalyst this technology needed or not.
Telemedicine has a bright future, with many patients and their providers not willing to go back to the “old ways.” As you astutely pointed out, reimbursement has been the greatest barrier to the adoption of telemedicine. Although telemedicine has greatly increased access to care, a real concern for payors and legislators is that it has made it “too accessible.” Within the field of dermatology, there is a concern that patients will utilize telemedicine to get evaluations for every new lesion on their body. However, I think it is important to note the indirect cost savings of seeing a provider remotely, such as commuting and time off from work. I see a promising future for telemedicine as a B2B business, boosting productivity by allowing employees to use their spare time at work to receive health evaluations as opposed to taking sick time.
From my understanding, regulations have been eased (or new guidance has been made) specifically for COVID. I totally agree that tele-health is here to stay – and I personally love it – but I wonder how the steady state might evolve to something that is more of an in between to where we are today vs where we were pre-COVID. For example, things like taking new patients via telehealth – I doubt that continues to be allowed when in person visits are safe again.
I agree that Covid has created the gateway to patients desiring a teledoc appointment. However, the impact can certainly outlast the pandemic. As users grow to enjoy the convenience of getting checkups from their home, there will be a clear ongoing need for all medical advisement that is not necessary for in person meetings.