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In Part 1 of this article, we posed the question: Are we entering a new era of ambulatory care where a whole set of structural changes are driven by the combination of new technologies, demographic changes and the many influences of Covid-19?  The answer is an unquestionable yes.  What is not so clear is the extent of those structural changes.

Will telemedicine, and other on-demand technologies, completely change the supply and demand for care in brick and mortar facilities?  Will a new crop of primary care platforms disrupt not only traditional primary care, but urgent care as well?  Will demographic changes exacerbate the gap between what new healthcare consumers demand (and how quickly) and what traditional medical groups can deliver? 

No Turning Back on Telemedicine

Unless you’ve been in a cave over the past several months, you know that telemedicine visits took off in a big way since the early part of 2020, driven largely by Covid-19.

Teladoc, the largest of the telehealth platforms, provided approximately 2.8 million visits in the second quarter of 2020, representing growth of more than 200 percent compared to the second quarter of 2019.  American Well, another large telehealth platform, saw revenue almost double during the first six months of 2020 versus the same period last year.  The company went from 6,000 active providers in June of 2019 to 57,000 active providers a year later.

If there was an acceptance factor blocking the way for rapid adoption of telemedicine before the pandemic, that has largely gone away.

The big question circulating among the ambulatory care community in general and urgent care operators in particular, is whether telemedicine represents a fork in the road where a whole new segment of care will evolve completely independent of traditional medicine?  Or will there be some form of integrated care, dictated by the primary care community because they own the patient relationship?

Put another way, will the relationships developed over many years between providers and their patients force new channels of care like telemedicine to work with traditional medical offerings like primary care and urgent care?  It is a question that was posed more than a decade ago as retail clinics began to proliferate under names like MinuteClinic (CVS Health), TakeCare (Walgreens), The Little Clinic (Kroger) and RediClinic (RiteAid).

“One debate is how do major telemedicine platforms like Teladoc handle patients who need to be seen face to face right now?” asks Robert Graw, M.D., founder and CEO of Righttime Medical Care, and a practicing pediatrician.

Graw says his company offers telemedicine services, but there is a continuum of care from the front door of a virtual visit to an in person visit if necessary.

“It’s one charge for one visit, but with two components,” he says.  “It’s navigated by the first person on our team who connects with the patient virtually.”

And there is a legitimate argument that many patients also want to see their provider in person.  MinuteClinic has invested heavily in telemedicine, but they still see strong demand for in-clinic visits.

“Patients really miss the interaction,” says Sharon Vitti, president of MinuteClinic. “They like seeing a provider’s facial expressions and they are itching to come back to face-to-face visits. The future is to provide both options to patients and make it seamless.”

But these arguments are an easy way to miss an underlying trend that points to a more permanent short-term reality, and perhaps an even bigger transformation long term. 

 Growth by Plans and Employers

In Teladoc’s second quarter earnings teleconference on July 29, the company continued to report stunning growth.  2020 revenue is expected to reach nearly $1 billion.  But one statistic is more telling in terms of the long-term horizon: in the first half of 2020, Teladoc signed up 15 million new patients through employers and insurance companies under its per-member/per-month (PM/PM) revenue model.

As was the case with MinuteClinic, overcoming the “acceptance factor” around new innovations is critical, otherwise that innovation is just another “cool” technology that goes only as far as the early adopter market.  Employers are a critical link to this widespread adoption of transformative healthcare services.  Teladoc has figured that out in a big way.  In fact, on the earnings call, Jason Gorevic, the company’s founder and CEO, mentioned that Teladoc recently signed a contract to provide its entire suite of clinical services to a Fortune 50 media company with well over 100,000 employees.

As further evidence of this, in the Business Group on Health’s 2021 Large Employers’ Health Care Strategy and Plan Design Survey, 80 percent of respondents said they believe virtual health will play a significant role in how care is delivered in the future, up considerably from 64 percent last year.  Further, when asked about actions they were taking to ease the burdens of COVID-19 for employees, the largest share of respondents — 76 percent — said they “made changes to allow for better access to virtual care solutions.”

Clearly, the employer and health insurance community are not concerned with the number of telemedicine visits that require follow-up appointments or how patients miss the in-person body language.

“The pandemic has accelerated the widespread adoption of virtual care,” said Gorevic.  “I’m confident there’s no going back.”

At a recent virtual event, U.S. Health and Human Services Secretary Alex Hazar, agreed, saying “I think we’d have a revolution if anyone tried to go backwards on telemedicine. This is now an embedded part of our healthcare system.”

A Bigger Picture Emerges

In the acute episodic illness space, in addition to telemedicine platforms, we are starting to see the emergence of much less expensive devices that could make a virtual visit very close to an in-person visit.

Tyto Health is a home medical device maker based in Tel Aviv.  Their home kit includes the main Tyto device with camera and thermometer; a digital stethoscope adapter; a digital otoscope adapter; and a tongue depressor adapter. There are rumors that Tyto is close to introducing a strep test module.  But for now, the entire kit represents very nearly a full telemedicine cart at home, available on BestBuy.com for $249.

Tyto is actively recruiting health systems and medical groups to partner with them, thus closing the loop between patient and provider.  In Tyto’s ideal world, both patient and provider would be using the same Tyto platform.

Tyto has a lot of sizzle because it also fits into the mass market space of consumers solving simple health problems at home.  But it also represents the massive space called home monitoring.

Payers are aggressively rolling out new disease-specific care management programs to provide patients the tools they need to help control their chronic conditions from home.

UnitedHealth, for example, launched new digital therapy for people with type 2 diabetes that combines wearable technology and customized personal support. The therapy, called Level2, helps participants gain real-time insights about their condition, using a mobile continuous glucose monitor, activity tracker, app-based alerts and one-on-one clinical coaching.

And less than a week after Teladoc announced its second quarter earnings on July 29, the company announced its intent to merge with Livongo, a leader in chronic condition management through remote monitoring and artificial intelligence technologies.  This is where we begin to see a company like Teladoc making similar moves to Amazon. 

Teladoc went public in July 2015 at a price of $19 a share.  The company has yet to turn a profit, yet its stock price is now trading at well over $200 a share, with a market capitalization hovering around $20 billion.  As with Amazon in 1997, through the public markets Teladoc has access to virtually unlimited capital on the cheap.  And with the Livongo merger, Teladoc is taking aim at the entire healthcare universe, just like Amazon took aim at the entire retail universe.

On-Demand Medicine – Ubiquity Coming Soon

Dr. Matt Ajluni is division head of urgent care and virtual medicine at IHA, a large multi-specialty medical group that is a member of Trinity Health Michigan in the southeast part of that market.  The medical group includes more than 1,000 providers across 80 offices and 13 urgent care centers.  During the four years prior to the pandemic they were seeing 30 to 50 patients a month virtually using a telemedicine platform from Zipnosis.  Each year prior to the pandemic they predicted significant growth, but it never came.

“There was very little adoption,” says Ajluni.  “But when the pandemic hit, adoption went from five visits a day to 800 a day.”

Ajluni says many of those telemedicine visits involved giving patients reassurance. That tapered to around 150 a day after three months.  Today, the Zipnosis platform is primarily a triage mechanism and visits have tapered off to pre-pandemic levels, but Ajluni says his group has been doing a much greater number of video visits outside of urgent care.  In fact, he says 15-20 percent of primary care visits are now virtual.

“The question is how much more could you do virtually; is there value add there?” he says.  “Part of me thinks that in five years the idea of going to an urgent care for less complex visits could go away. Why would you go into a brick and mortar?”

Ajluni says we are not there yet, but he points to Tyto Care and new models such as One Medical or 98point6.com as evidence of potential disruption not only in urgent care but in primary care as well.

“Groups like that are disrupting the traditional medical care market,” he says. “But we still believe strongly in the primacy of the primary care relationship, and we will continue to support that, even as we build other novel care delivery mechanisms.”

Bigger than Telemedicine

Amazon was founded by Jeff Bezos in Bellevue, Washington, on July 5, 1994. The company started as an online marketplace for books. By the time the company went public in May of 1997 (at $18 per share), it had expanded to sell electronics, software, video games, apparel, furniture, food, toys, and jewelry.

At around the same time, there was talk about connecting high-speed internet to the “last mile,” making on-line access ubiquitous.  It was also at that same time that no major retailer mentioned Amazon as significant competition in their annual 10K reports.

STAT is an online site that produces articles and insight on health, medicine and scientific discovery.  A recent article featured Mintu Turakhia, a cardiac electrophysiologist who is the executive director of Stanford’s Center for Digital Health. 

“We think about how we’re going to train the next generation of digital health doctors and leaders,” Turakhia told STAT.  “We actually now realize there’s a whole new set of what I’m calling last-mile problems for digital health.”

The parallels between the digital retail and digital health are becoming more evident by the day.  Telemedicine’s most recent attention is the result of a mass market of consumers getting care for low-acuity, episodic problems.  But there is much more going on in the background.  Just like Amazon, artificial intelligence, high-bandwidth connections, continuing growth of computing power and storage solutions are also part of this digital health equation.

It is a bigger picture that traditional healthcare providers may be missing the same way Walmart and Target missed Amazon in 1997.  Said another way, is there a danger that we misperceive telemedicine as the big picture, when it may just be the start, like Amazon’s initial focus on books?

On the other hand, will brick and mortar in healthcare survive just like brick and mortar have survived in retail?  After all, Amazon turned a lot of heads in 2017 when it paid around $13.7 billion for Whole Foods’ 450 physical locations.

“For practices to grow, they need to accept the emergence of virtual medicine, no matter what form it evolves to,” says Dr. Graw from Righttime. “Support your patient. Teach them how to use it well. Tell them you will be there for them. They are going to use virtual medicine with or without you.”

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