- Teladoc is providing more than 20,000 virtual medical visits per day in the U.S., more than double the volume of the first week of March as the coronavirus outbreak continues to drive telehealth adoption.
- The Purchase, a New York-based vendor, released some details of its first financial quarter of 2020 on Tuesday. Teladoc expects revenue to be between $180 million and $181 million, up roughly 40% year over year, and adjusted EBITDA between $10 million and $11 million — nine times larger than the first quarter of 2019.
- Teladoc expects volume in the quarter ending March 31 to be above 1.8 million visits, up more than 70% from 1.06 million visits during the same period last year. That's a significant jump, though analysts said they expected utilization to be even higher. More than 60% of visits are new users looking to check potential COVID-19 symptoms or treat non-respiratory conditions as they shelter in place.
Non-essential healthcare delivery has largely gone digital as a result of the pandemic, boosting telemedicine adoption as patients use myriad services to connect with doctors in the home. Virtual care providers including Teladoc, privately held AmWell and mobile app-based 98point6 are struggling to meet demand as a rising volume of the so-called "worried well" use remote care to check symptoms without going to the hospital, where they could spread or contract the virus.
About one in 10 Teladoc visits are for people who believe they may have been exposed to the virus, but CEO Jason Gorevic said on a Tuesday afternoon call with investors the vendor has seen a surge in all types of visits, notably dermatology and mental health. New users span many demographics, but Teladoc is seeing the strongest growth among men aged 18 to 30, a population that was "previously uninterested" in virtual care, he said.
Utilization of 1.8 million visits is "very strong," Jefferies analyst David Windley wrote in a Wednesday note, but considering social isolation, swelling payer coverage and "growth commentary by competitors, we expected higher."
Virtual care providers have been furiously hiring doctors and racing to onboard them to cope with the demand. Teladoc has seen expenses hike along with revenue, saying it had $4 million in additional unforeseen expenses in the quarter. The vendor upped the salary of its physicians and hired more doctors and support staff to handle the influx of new patients, hiring thousands of new providers since early March, executives said, more than doubling the size of its physician network.
"It's too early to quantify the long term impact of the virus ... but it will only serve to accelerate the adoption of virtual care," Gorevic said. "The role of virtual care has changed forever."
Eighteen-year-old Teladoc has been publicly traded since 2015 but has failed to turn a profit for shareholders so far, operating at a loss of $98.9 million last year despite ongoing volume growth. However, the pandemic and subsequent expansion of telehealth reimbursement by public and private payers has driven Teladoc stock up almost 90% since the end of 2019.
Major commercial payers and the Trump administration have rolled back financial and regulatory barriers to virtual care as the pandemic continues to spread in the U.S., infecting more than 600,000 and killing more than 26,000 as of Wednesday morning. Most large health insurers, including UnitedHealthcare, Anthem, Aetna and Cigna, have waived cost-sharing for telehealth visits for COVID-19 testing and treatment.
The Trump administration in mid-March announced traditional fee-for-service Medicare would temporarily cover telehealth visits for the duration of the national emergency, and that HIPAA privacy law penalties curtailing telehealth use would not be enforced. Virtual care companies had been advocating for the relaxation of such regulations for years.
Teladoc plans to provide full financial results for the first quarter on April 29.