PART 1: TELEHEALTH… THE FUTURE IS NEAR
The outlook for telehealth at beginning of 2020 was good with adoption trending in a positive direction. A survey of American College of Physicians (ACP) showed increased usage over the prior year suggesting continued steady expansion in 2020. The vast majority of ACP members surveyed were interested in learning more about telehealth technology as well as its effective and safe use in practice. Technology penetration in three provider-focus telemedicine areas showed the strongest potential: electronic e-consults (42%), asynchronous evaluations (39%), and synchronous virtual care (33%). The expected short-term opportunity in adoption was video visit technology where it was already deployed. Implementation of the three patient-focus digital telehealth areas were less pervasive: Remote Care Management (28%), Remote Patient Monitoring (24%), and Patient Wearables (6%). The expected short-term opportunity was increasing availability of these technologies within healthcare practices. In general, the barriers to adoption to date has largely been financial and structural concerns, not a lack of interest amongst providers.
This blog details how the COVID-19 public health emergency forced the healthcare ecosystem to address many of these roadblocks to remote care. It is the first in a three-part series exploring the evolution of telehealth and remote care in the post-COVID landscape.
Telehealth: Rise of COVID-19
When the COVID-19 pandemic hit the US in early March 2020, the technology implementation of telehealth exploded overnight. As a lead indicator, submitted claims for telehealth services jumped 83 times nationally in April 2020 over April 2019. The Office for Civil Rights set the stage for this growth by relaxing HIPAA requirements around the use of the commercial video conferencing solutions such as Zoom and Skype. State regulators were pushed to maintain a pool of remote providers by allowing temporary licensing of healthcare professionals across state lines. FDA recently released as a series of medical device guidance documents to increase availability of critical healthcare equipment and address the need for social distancing and remote care. FCC allocated $200 million to provide immediate support for funding healthcare providers telecommunication services. Most critically, CMS set the precedent for telehealth reimbursement during the public health emergency and the private payers followed suit. The ramp–up of the infrastructure for practices and health networks in many instances took between 48 and 72 hours and leveraged makeshift staging areas. In some cases, parking lots were used for distributing laptops outfitted with camera to individual healthcare providers, who were equally motivated to continue working. Even reluctant patients found themselves welcoming the telehealth visits and the feedback has generally been positive. Telehealth was demonstrated as a serious alternative to in–person care for many treatment scenarios. In the keynote address at the American Telemedicine Association (ATA) 2020 conference, Dr. Joseph Kvedar proclaimed “Telehealth is now a household word.”
Telehealth: Industry in Turmoil
The current evidence suggests the telehealth industry will continue to evolve as the market has not reached a steady state. Given that the impetus for the current expansion is the public health emergency, what will the future hold for the industry when the pandemic subsides? Several private insurance companies have already signaled the potential end dates for supporting telehealth reimbursement. In response, United States congress is considering legislation to extend nationally the current exemptions for 180 days past the end of the public health emergency. In parallel, the states Rhode Island and Colorado are looking to implement these changes permanently around reimbursement. Telehealth usage dropped significantly in May 2020 as Primary Care Providers (PCP) restored operation by implementing protocols to manage COVID risk and keep both patients and staff safe. For platform vendors, the spike in telehealth implementations seen in March has been subsiding due to tempering of demand. In fact, an argument can be made that there may be consolidation among healthcare video providers given that so many solutions have been rapidly deployed in such a short period of time. As regulatory requirements tighten again, commercial tools may be under renewed scrutiny in view of negative publicity for platforms such as Zoom. Healthcare regulators tend to demand a comprehensive approach to securing Protected Healthcare Information (PHI) as discussed in a recent cybersecurity blog. So, is the opportunity in telehealth industry already past? Investment sages will say that normal careful due diligence is in play and startups in this space need to have a novel approach to be competitive in the industry.
Telehealth: Wide Open Opportunity
A Frost & Sullivan report released in May 2020 predicts a tsunami of growth with a one year increase of 64.3% over 2019. The compound five-year annual growth rate (CAGR) is estimated at 38.2%, which is substantially higher than previous pre-COVID era estimates. These projections may be fueled in part by continued favorable reimbursement landscape. A better explanation perhaps is that the dramatic shift in the industry has created a series of opportunities that will take time to realize. Due to Coronavirus, a decade worth of telehealth policy evolution happened in just 2 weeks of time. It may take a while for payers, providers, patients, vendors and regulators to fully adapt to the new normal. There is now clinical evidence for changes in healthcare practices that normally would have taken multiple years to realize. With appropriate AI tools, the data can be used to create new medical device opportunities in healthcare delivery. As an example, the number and spacing of PCP visits during pregnancy has largely remained the same over the last several decades. Given the acute risks associated with COVID-19 exposure, providers are rethinking care plans and systematically replacing in–person visits with telehealth. In anticipation of this trend, the FDA has relaxed regulatory requirements for medical devices supporting maternal and fetal remote care. In a lot of ways, the standard of care has been a barrier to innovation and the new risks introduced by the pandemic have forced the risk–averse healthcare industry to make innovative changes out of necessity. This is just one example, but how many more barriers are out there that may disappear over time as the market adapts?
Telehealth: Remote Digital Health
The potential gold rush of opportunities in telehealth are best understood within the context of emerging areas of digital health. Over 40% of the leading 150 digital health companies in 2020 are incorporating the paradigm of remote delivery. Per the diagram below, the base category of digital health (white) encompasses technologies and platforms that engage consumers for health-related purposes; processes health-related data; and/or support(s) life science and clinical operations. This includes telehealth tools that enable the remote delivery of synchronous and asynchronous health evaluation and care, as well as consumer grade wearables and wellness applications. The next level in the digital health continuum (blue) entails platforms that have been subjected to clinical validation and may or may not be classified as medical devices. Digital Medicine is comprised of evidence-based software and/or hardware products that perform health measurements and intervenes in the service of human health. Key example areas in telehealth include remote care management and remote patient monitoring, including medical grade wearables. The final category in the digital health diagram (orange) contains what are generally software medical devices that requires rigorous clinical evaluation. Digital Therapeutics (DTx) products deliver evidence-based therapeutic interventions to prevent, manage or tread a medical disorder or disease. The delivery of these digital treatment commonly occurs remote from medical facilities and providers by leveraging software applications on mobile smart devices.
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