According to a report issued by According to the National Center for Health Statistics, the percentage of adults using telemedicine in the past 12 months has decreased by 6.9%.
When virtual care numbers Back on the ground, the industry is adjusting. For example, when Amazon consolidated and repositioned its own telehealth services this summer, it announced a $49 pay-per-visit consultation service.
One A recent study reported on trends in telehealth in U.S. hospitals—and explored the opportunities and barriers to growth. Meanwhile, the American Telemedicine Association is asking the Centers for Medicare and Medicaid Services for more flexibility and guidance on payment and coverage.
Industry experts also see the need for clarity. Matt Wolf, senior healthcare analyst at consulting firm RSM US, believes that without regulatory reform, telehealth in the United States is likely to stagnate—and perhaps even decline. Despite the continued focus on telehealth, the industry still faces many obstacles that could limit the success of virtual care, he said.
We interviewed Wolf to better understand his views on the state of telemedicine and regulation, and to discuss his belief that when payers and providers are incentivized to drive health outcomes for patients, leveraging technology to expand access can make economic sense.
Q. You believe that without regulatory reform, we will likely see telehealth services stagnate and possibly decline. Why is that?
ONE. The economics of healthcare in the United States cannot be separated from the regulatory and reimbursement environment. For telehealth, this current environment is extremely complex to navigate.
Ultimately, patients want to access healthcare services when, where, and how they are most convenient. This is how we interact with most services in our lives. We shop, entertain, socialize, bank – even work, to some extent – through whatever physical or digital channel we choose, at the time of our choosing.
This is the promise of telemedicine and virtual health: expanding access to the level of customizable convenience. The current regulatory and reimbursement frameworks prevent that. Instead of a single labor market that can serve patients online, we have 50 local markets.
Convenience comes from matching a Pennsylvania patient’s needs with the right provider, regardless of where that provider is located. A telehealth or virtual care platform that must be matched with a provider in the same state as the patient is only slightly more convenient for most patients than simply going to a physical location for care.
Furthermore, the cost of many virtual visits simply adds up. Patients are referred to the emergency room or their physician, and the cost of the virtual visit does not apply to the care being referred. This also drives patients away from existing services. telehealth and virtual health care options.
While there are use cases for telemedicine and virtual health applications, we won’t see widespread solutions that significantly expand access and convenience without a regulatory overhaul. The economics simply don’t work, and we won’t see widespread adoption of a system that is inconvenient and undemanding to patients. That’s what they expect in almost every other aspect of their lives, and anything beyond that will have limited impact in healthcare.
Q. The statewide physician license that allowed physicians to practice and provided reimbursement equity due to the pandemic has now expired. How is the healthcare industry meeting this challenge?
ONE. The healthcare industry disagrees that state licensing needs to be overhauled. There are stakeholders on both sides of the debate. Those who support our current model often cite patient safety as a reason for more restrictive licensing. Others argue that overhauling the current system would improve access and that any quality disparities between states should be addressed regardless of the licensing model.
The rapid development of generative AI and other cutting-edge technologies provides a bright spot for innovation. Such technologies over time could augment, but not replace, providers’ ability to care for patients at a consistent level of quality regardless of how close the patient is to the provider.
Certainly, every provider has an upper limit on the number of patients they can see, serve, treat, or operate on in any given day or week. The appeal of advanced technology lies in reducing the time spent on provider workflows that do not directly impact patients.
Leveraging such technologies will ease the burden of texting patients, identifying potential complications by piecing together data from multiple health records, highlighting potential complications of prescriptions, etc. These technologies will help providers focus more on clinical care without having to work overtime, thereby alleviating the healthcare labor shortage.
Additionally, such technologies can be used to assess quality and help providers stay up to date on the latest medical research and best practices, which can help address disparities in care and outcomes.
Q. Telehealth services are expected to be accessible, although many rural communities still lack the bandwidth to use the technology. How can this obstacle be overcome?
ONE. Spend on infrastructure. It could be cable internet, fiber optics, satellites, or something yet to be discovered, but that’s the only answer. The US has historically underinvested in its own infrastructure. For about 15 years until 2022, we had very low, even negative, interest rates. This led to a period of underinvestment from both the private and public sectors.
The so-called “easy money” period means easy opportunities for most people as long as interest rates remain low.
Now, to drive sustainable financial growth, both the private and public sectors need to invest, and we are seeing elements of both. In the private sector, we are seeing significant investments in everything related to AI – semiconductors, data centers, private data – and energy – both traditional and renewable – among other areas.
Fiscal policy is also directing infrastructure investment through the Deflationary Act, the Semiconductor Manufacturing Productive Incentives Act, and the bipartisan Infrastructure Act.
It’s hard to say whether this is enough to fully expand broadband access to rural areas. The IRA and the Bipartisan Infrastructure Act allocate $274 million and $65 billion for this task, respectively, and the private sector is certainly interested in expanding broadband access in its own way.
However, groups like the American Society of Civil Engineers and the FCC have questioned whether this government spending is enough to bring broadband to every corner of the United States. According to a 2021 study finds 65% of US counties have internet speeds below FCC’s definition of “broadband.”
Many health care providers are struggling with the economics of providing free preventive care. They cannot afford to be burdened with providing free broadband access to their rural patients. Governments must take the lead.
Q. You point out that when payers and providers are incentivized to drive health outcomes for patients, leveraging technology to expand access—which will also increase utilization—can make economic sense. What can hospitals and health systems do to make this happen?
ONE. Providers who want to rely on this type of linkage also need to control health care financing – which means they need to be integrated with the payer itself. By controlling the delivery and economics of care, a party called the payer can, in theory, align incentives and drive better outcomes.
Of course, this structure does not guarantee success. Organizations in this model need to leverage patient data, clinical process data, and understand the cost of providing each unit of care to a given patient. However, generative AI and other advanced technologies are making this a much more manageable prospect.
With proper organization and analysis, a payer can be fairly certain that providing care X to patient Y at cost Z will improve patient outcomes in a way that is financially sustainable for the organization as a whole. Or, if that care plan is not financially sustainable on a per-patient basis, the organization can budget for it and try to recoup costs elsewhere, identifying clinical or operational improvements in that care plan, or both.
Finally, health care is a scarce resource. Scarce resources can generally be allocated through market-based pricing mechanisms or through direct allocation. Many observers and analysts worry—with good reason—that expanding access to care will drive utilization in a way that is financially unsustainable.
One potential way to address concerns about overutilization is to first leverage technology to augment clinical care so that our current workforce can provide more care without having to work overtime. This would actually reduce the health care shortage.
The second step involves using advanced technology to ensure that each patient receives the exact care they need at the right time in a way that improves outcomes and is financially sustainable. These steps would not have been possible with the technology available even three years ago.
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Healthcare IT News is a publication of HIMSS Media.
