Telemedicine was once the darling of health care during the pandemic, saving the industry from plummeting to zero with the abrupt closure of in-person visits and becoming an essential investment.
But now, mandatory investment is nearing zero as telehealth companies downsize or exit altogether in the face of declining demand.
UnitedHealth Group (UNH) is discontinuing its telehealth services. Market leaders Amwell (AMWL) and Teladoc (TDOC) have been hit by layoffs and their stock prices have plummeted more than 50% over the past year. Amwell's market capitalization was once close to $6 billion. Today it's less than $200 million.
But some experts say telemedicine shouldn't be considered just yet.
“Telehealth 1.0 is over,” said Owen Tripp, CEO of virtual health platform IncludeHealth.
“We cut it down and we put it through the wood chipper. But when we do that, we create the mulch that a lot of really interesting big things need to grow,” he told Yahoo Finance.
The digital health company has been on a post-pandemic roller coaster, from reportedly preparing for an IPO in late 2021 to laying off about 6% of its workforce in mid-2022.
Tripp said the problem with basic telemedicine is primarily a single point of contact and no long-term health monitoring.
“The problem with telemedicine 1.0 is you can put a quarter on the jukebox, listen to one song, and that's it. You'll never see the same doctor twice,” Tripp said.
His company launched a specialized virtual care strategy to connect the dots in a disparate care system. It includes a hub where patients can go back and interact with previously seen doctors.
The future of telemedicine
Digital healthcare remains in demand despite the withdrawal of telemedicine businesses, according to a study published in March by investment firm Rock Health. For the third year in a row, the survey found that more than 75% of respondents reported having used virtual care, and of those, 83% said they had used virtual care in the past year. got it.
However, the survey showed that even people using virtual care still prefer in-person care for certain things. For example, 69% said they would prefer virtual care for prescription refills, less than 20% said they would prefer virtual care for urgent care or physical therapy, and fewer would prefer virtual care for annual physicals. Only 24% said they preferred it.
Sari Kaganov, Rock Health's chief commercial officer, compared the burgeoning telemedicine industry to the dot-com era, when websites were popping up everywhere, “and for a while that was enough.” .
“Does anyone say that the Internet is dead now? No, of course not. Every company has a website. It's part of what they offer. Just having a website is not enough.” he told Yahoo Finance.
Similarly, telemedicine needs to evolve and grow beyond its current capabilities, she said. And how companies differentiate themselves will be key, she says.
For Kaganov, that means it could be a small company with a specific purpose, such as writing prescriptions for common ailments.
But Tripp says there should be a bigger goal.
“Primary care, behavioral health, specialties, all of those things need to be connected,” Tripp said, adding that it would be difficult to achieve that as a national, 24/7 service.
“This is a new expectation brought on by the pandemic, and very few players can live up to it,” he said.
Anjali Khemrani She is a senior health reporter for Yahoo Finance, covering all areas of pharmaceuticals, insurance, care services, digital health, PBMs, and health policy and politics.Follow Anjali on all social media platforms @AjKhem.
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