- Private insurers paid roughly the same for telehealth and in-person visits during the early days of the COVID-19 pandemic as virtual care surged, according to new research from the Kaiser Family Foundation.
- Though it’s unclear how payment rates might have changed over the past two years, the findings call into question the argument that telehealth is saving the healthcare system money, researchers said.
- However, researchers said that perks of telehealth included expanded access and convenience — cost benefits of which were not factored into the study.
Lawmakers continue to debate which pandemic-era telehealth flexibilities should remain after the COVID-19 public health emergency ends. One complicating factor is a lack of insight into how telehealth affects healthcare spending.
Virtual care could result in savings if payers reimburse it at a lower level, but it also could encourage the use of more services, causing overall spending to rise, the researchers noted.
Now after more than two years of spiking telehealth utilization caused by the pandemic, research is beginning to arrive at some conclusions — with implications for how the industry is regulated in the future.
For the study, KFF analyzed nearly 100 million claims compiled by the Health Care Cost Institute to compare the average amount private insurers paid for in-person and telehealth evaluation and management services, and mental health therapies, in 2020. Researchers controlled for variation across providers and regions along with claim severity, and found that private insurers shelled out similar amounts for virtual and in-person claims.
There was little difference in the cost of telehealth and in-person services during the pandemic's first year
KFF also found mental health therapy claims payments were similar for in-person and virtual care that year. For example, a 30-minute psychotherapy session was $48 for a privately insured individual, regardless of whether it was provided in-person or via telehealth.
Among the majority of doctors who offered both telehealth and in-person care, the average paid amount for claims delivered virtually was within plus or minus 10% of that for claims delivered in person, according to the study.
It’s still unclear whether private insurers have continued paying for telehealth at parity with in-person care. But if they have, that could complicate the notion that telehealth reduces spending on common medical services, researchers said.
“I think it’s important to keep in mind that the main value of telehealth is increasing access to quality care, including access to care for millions of Americans who otherwise might go without necessary healthcare services,” said Joseph Kvedar, a professor at Harvard Medical School and past chair of the American Telemedicine Association, in a statement to Healthcare Dive.
“Unfortunately, oftentimes our system doesn’t capture the full economic value of telehealth in providing cost-saving preventative care, saving patients and employers lost time, wages and productivity for individuals traveling to far-away brick-and-mortar healthcare facilities for routine care visits,” Kvedar said.
Determining telehealth’s return on investment has proved a challenges, as multiple studies — including from before the pandemic — have reached conflicting conclusions.
For example, research released late last year found most patients who had a telehealth visit didn’t require an in-person follow-up, suggesting telehealth doesn’t result in duplicative care. However, another study from 2017 conducted by the Rand Corporation and Harvard researchers found virtual care increased healthcare utilization and spending in California.
Regulations allowing for broader telehealth payment and access are set to wind down when the COVID-19 public health emergency expires, which is projected to be sometime this year. Congress has enacted a temporary grace period for telehealth flexibilities after the end of the emergency, giving regulators more time to analyze telehealth’s impact before lawmakers enshrine new legislation.