Is This (Finally) Telemedicine’s Moment?
Source: Yahoo Finance
The Signal: Telemedicine — the practice of remote care via video, calls, texts, email etc. — has been hyped for years and seen billions of investment dollars. But as recently as 2017, fewer than 20% of consumers used it. The coronavirus outbreak is likely the catalyst that pushes telemedicine into the mainstream for good.
In China, leading telemedicine apps have seen widespread adoption since the start of the year. Ping An Good Doctor, which touts its “mobile health + AI technology” online healthcare ecosystem, increased new users by 9x as news of coronavirus circulated through China in December and January.
In America, Teladoc — a US-based firm that provides telehealth and virtual care — has seen a 50% YoY surge in use while its stock price has nearly doubled year-to-date.
During the current health crisis, Teladoc is activating thousands of doctors onto its platform, operating virtual COVID-19 clinics (to assess initial patient symptoms and determine if further testing is needed) and installing its hardware directly in hospitals and clinics.
Last week, the firm’s CEO told CNBC that “demand has shifted forever in virtual care.”
A number of factors are contributing to this shift:
- Patient Awareness: Amid vast quarantines and social distancing measures, patients are more willing (and often have no choice) but to try telemedicine options. Virtual care allows patients to be diagnosed from the safety of their homes and allows doctors to serve larger geographic areas.
- Reimbursement: In the US, rules around telemedicine reimbursement have been quite restrictive. However, the federal government’s recent $8.3B funding bill to combat coronavirus allows the Department of Health and Human Services (HHS) to “suspend rules that restrict access to remote care” for Medicare patients. Moving forward, reimbursement for a wider expanse of telemedicine services will be a boon for the industry as patients know they will be covered and doctors can receive comparable payment as an in-person visit.
- Doctor Liquidity: Typically, telemedicine providers have to be licensed in every state that they want to practice in. In response to the current crisis, “many governors have relaxed licensure requirements related to physicians licensed in another state and retired or clinically inactive physicians,” according to this guide from the American Medical Association (AMA). If these relaxed guidelines stay in place, the supply of telemedicine services can rapidly expand across the country.
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