Catalyst for Payment Reform




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What Is Telehealth?

In an increasingly virtual world, phone and video health care visits are becoming an essential part of the patient care experience. Telehealth is one of many technology-driven disruptive innovations that challenge brick-and-mortar health care providers, who will consequently need to compete harder on price, access and convenience. According to the Health Resources and Services Administration telehealth “is the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional health-related education, public health and health administration.”[1]


Why Should Employers and Other Health Care Purchasers Care About Telehealth?

Telehealth offers fundamental benefits for patients and health care purchasers alike, including:

  • Improved convenience and access to health care services for patients
  • Potential cost savings as telehealth replaces costlier in-person care (e.g. emergency room visits)
  • Disruptive innovation in the delivery of care, which stimulates competition among health care providers.[2]

What Are the Latest Trends in Telehealth?

COVID-19 has changed the way Americans access health care, and virtual care use has skyrocketed.

  • According to KFF’s 2020 Employer Benefits Survey, 89% of firms with 200 or more workers cover the provision of health care services through telemedicine in their largest health plan, compared to 82% in 2019.[3]
  • Some health plans are waiving cost-sharing for telehealth visits for certain services and populations.[4]
  • Use of telehealth increased by 3552% between August 2019 and August 2020. Approximately half of these visits are related to mental or behavioral health.[5]
  • Urban areas have higher telehealth usage than rural areas, though usage is growing in both.[5]
  • Since the onset of the pandemic, the federal government and all 50 states have updated telehealth policies to expand access to telehealth services. Common measures include: payment parity between virtual and in-person visits, defining telehealth to include both telephone and video encounters, and removing requirements that the patient and physician have an existing relationship prior to the first virtual visit. Some updates may be temporary.[6]

How Can Purchasers Utilize Telehealth as Part of a High-Value Strategy?

Purchasers should implement telehealth in a way that fits well with their benefit structure, the needs of their population, and the dynamics of their provider markets. Options include:

  • Making telehealth services offered by health plan partners available to employees.
  • Incorporating telehealth services from a standalone vendor, such as a behavioral therapy vendor, as a low-cost wellness benefit for employees. Include employees enrolled and not enrolled in the employer-sponsored health plan(s).
  • Requiring health care providers (directly or through health plans) to offer telehealth services to their own patients, as part of a patient-centered medical home or accountable care organization delivery model.
  • Offering telehealth to patients in advance of, or after seeking care from, a center of excellence.

Want to learn more? Check out these additional resources




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