Since the beginning of the COVID-19 pandemic, publicly-traded telehealth companies have experienced considerable growth, while hospital systems are reporting surges in virtual visits. For example, Ochsner Health hospital in Louisiana, which is considered to be one of the coronavirus hotbeds, said it has carried out over 120,000 virtual consultations in 2020, as compared to only 3,300 in 2019. Telehealth is increasingly used in behavioral health, radiology, cardiology, and online consultations.
Virtual healthcare is a method to treat patients who suffer from routine health issues by using video, audio, or written communication. In some cases, this includes virtual visits that are performed with the help of high-tech communication devices based on virtual reality technologies. Italian scientists note that since telemedicine mainly focuses on transmitting medical information, VR has the potential to improve this function. “Particularly, VR can be used in telemedicine as an advanced communication interface, which enables a more intuitive mode of interacting with information, and as a flexible environment that enhances the feeling of physical presence during the interaction,” the researchers write.
Consultations, meetings, check-ins, and checking the status of reports can be performed with the use of virtual care. This method is also beneficial in treating diseases that require continual follow-ups. The rising number of patients suffering from such health issues as hypertension and diabetes will further stimulate the expansion of the virtual care market in the forthcoming years. The key growth drivers for the market include requirements to ensure social distancing, growing adoption of this type of services in healthcare organizations, and the rise in funding by both the public and private sectors in the area of healthcare IT. The major restraint is increasing concerns regarding patient data privacy.
The term virtual healthcare is sometimes used synonymously with telemedicine, but there is a difference between them. Virtual care is a broader term and includes all kinds of digital healthcare services, while telemedicine is a more specific term that refers to long-distance patient care. Mobile health, also known as mHealth, is an important part of virtual healthcare. These apps are installed on patients’ smartphones or tablets and are intended more for education than for diagnosis or treatment. For example, doctors may use a mHealth app to provide a patient with recommendations about what they should do after surgery. Additionally, AI-driven big data processing and remote monitoring allow for grouping patients by risk factors in order to develop more targeted treatment plans.
“The largest component of the virtual care market involves the use of telehealth and telemedicine. However, the concept of virtual care presents opportunities that extend beyond telehealth and telemedicine and can improve the management of patients across all healthcare segments,” said Victor Camlek, a research manager at the American business consulting company Frost & Sullivan. “Virtual care platforms can provide an improved level of efficiency in workflow processes such as test scheduling, results notification, and follow-up patient care management that will be required in the next generation of healthcare well beyond the pandemic,” Camlek notes that the broader term of full-scale virtual care includes electronic health records (EHRs), patient relationship management, and basic functions such as scheduling and billing.
Telemedicine was the top funded digital health category in 2020, accounting for $4,267 million, followed by data analytics ($1,838 million) and mHealth apps ($1,391 million). The market is highly competitive, with companies introducing innovative solutions. For example, One Medical, a membership-based primary care company owned by 1Life Healthcare, Inc. (ONEM), has launched a platform that offers 24/7 virtual support and is integrated with gadgets providing remote monitoring, such as Fitbit and Apple HealthKit. Using this platform, patients can also access health coaches and educational classes.
The telehealth market is segmented by type, application, and end user. Based on type, the market is divided into services and products. The services segment is forecast to dominate the market within the next five years, driven by the rise in the number of online consultations and increasing funding of start-ups. The product segment will also grow, mainly due to an increase in demand for tablets and wearable monitoring devices. For example, last year, Philips launched a next-generation wireless wearable monitoring device, BX100, which is expected to expand the product segment of the telehealth market. Cleared by the FDA, this wearable biosensor is designed for early patient deterioration detection and can help monitor COVID-19 patients.
By type of application, the market is categorized into telemedicine, continuous medical education, patient monitoring, and others. The telemedicine segment makes up the largest share of the market, supported by the high usage of virtual consultation apps. Continuous patient monitoring is especially in demand as a service for elderly people and is stimulated by the introduction of new wearable monitoring devices. The American Telemedicine Association has said that 1 million U.S. residents are already using cardiac monitors, highlighting that proactive care via remote monitoring has turned out to be a great opportunity for patients with chronic heart diseases.
Based on modality, the market is segmented into real-time, store-and-forward, and remote patient monitoring. In this context, the real-time segment is expected to grow at the fastest rate in the period from 2021 to 2028 because of the rising popularity and low cost of e-visits. The growth of the remote patient monitoring segment will be driven by partnerships, technological innovations, and the launch of new products. Two years ago, the U.S.-based UnitedHealth Group (UNH), which is the world’s largest healthcare company by revenue, acquired a start-up Vivify Health that provides connected devices and other technologies for tracking at-risk patients at home, especially those with asthma and diabetes. The global remote patient monitoring market is estimated to grow with a CAGR of 13.5% and reach $1,8 billion by 2026. The store-and-forward segment is supported by the increasing use of digital images in telepathology and teleradiology for diagnostic purposes.
And finally, the virtual care market can be categorized by end-users: healthcare facilities, home care, and others. The segment of healthcare facilities is dominating the market so far because the increased adoption of telemedicine helps to lower the work burden on the staff.
Virtual Care & Telemedicine Market in the U.S., Canada & Australia
The global virtual care market will grow with a CAGR of 25.2% from 2021 to 2027, driven by markets in North America, Europe, and the Asia-Pacific region. Last year, North America was the dominant telehealth market thanks to the improved healthcare infrastructure, strong IT and telecommunications sectors. The region will continue to maintain its dominant position in the next few years because advanced technologies were adopted early in the region.
The United States
According to Frost & Sullivan, the US virtual care market is forecast to see tremendous growth by 2025, with an impressive CAGR of 40.4%. The research firm describes virtual care as “the next growth opportunity across the healthcare space.” In 2020, the management of chronic care represented about 36% of the U.S. virtual care market share. Chronic diseases such as diabetes, cancer, and hypertension, are of particular concern for healthcare providers, given that approximately 40% of Americans suffer from chronic diseases. The number of electronic prescriptions in the United States has been rising steadily from 1 billion electronic prescriptions written in 2013 to $2.27 billion in 2020. The private company Surescripts, which is owned by CVS and ExpressScripts, is the largest e-prescribing company in the United States.
The U.S. virtual care market is characterized by accelerated technological change and rising industry standards. Companies are using next-generation technologies to improve their solutions and developing new services to expand their client base. Before the coronavirus pandemic, the U.S. virtual care market was in its early stage of development. However, following the introduction of COVID-19-related restrictions, the market has become highly competitive. Companies are offering new provider networks, integrated technology platforms, and entrenched distribution channels.
Last year, the 10 largest digital health investment deals were done in the USA. Around $500 million were invested into U.S. health insurance company Bright Health Group, Inc. (BHG). In April, Bright Health acquired Zipnosis, a healthcare company that specializes in online diagnosis and telehealth, which helped the company to strengthen its position in the telehealth market. Zipnosis, which has been operating in the market for 10 years, has developed a telehealth platform that is utilized at around 60 large health systems across the United States.
Teladoc Health Review
The first and largest telehealth company in the U.S. is Teladoc Health (NYSE:TDOC) with a market capitalization of $15 billion. Founded in 2002 in Dallas, Teladoc Health expanded nationwide in just three years and a decade later, the company went public. Experts say that no single telehealth company has capitalized on the pandemic’s consequences like Teladoc. Moreover, the company continued its steady acquisition policy in 2020 to remain a market leader.
Teladoc Health uses videoconferencing and telephone software as well as mobile apps to provide remote medical care. Patients can log on to the service via a mobile app to connect with state-licensed physicians in a matter of minutes. Teladoc Health provides access to an expert network of more than 55,000 physicians in 50 states, including 450 medical subspecialties. These experts treat health conditions in five categories: everyday care (flu, stomachaches, sinus infections, and skin disorders), family medicine, mental health, wellness (including nutrition and sexual health), and medical opinions about a diagnostic or the need for surgery. Teladoc Health works with over 400 hospitals and health systems, including such giants as UnitedHealth, CVS, and Johns Hopkins medical center.
The company’s consumer-facing brands include the on-demand telemedicine platform Teladoc, Advance Medical, a global leader in expert medical opinions that serves more than 125 countries, virtual medical consultation company Best Doctors, telemental counseling provider BetterHelp, HealthiestYou, a telehealth platform for small- to midsize employers, telehealth platform for hospitals and health systems called InTouch, Livongo that provides chronic condition management, and France-based telemedicine provider MédecinDirect.
Jason Gorevic (49 years old) is CEO of Teladoc Health and has been a member of the board of directors since 2009. Prior to this, Mr. Gorevic held various management positions at WellPoint, Inc., a health insurance company that is now known as Anthem, Inc. Until December 2001, he served as CEO of Gemfinity, an electronic marketplace that he founded and prior to this held the position of a general manager of business messaging at Mail.com, Inc. Mr. Gorevic is also a member of the board of directors of the New York Road Runners, a nationwide program that helps youth develop the desire to be physically active for life.
Mr. Gorevic is described as an executive who has managed to “turn the small company into the $29 billion leader in virtual medical services” and “built the industry from practically scratch”. After graduating from college in 1993, Mr. Gorevic went into his family's jewelry business but worked there only one summer. "It wasn't something that I was passionate about,” he said. Then, Mr. Gorevic joined Oxford Health Plans, an American healthcare company that sells benefit plans, where he developed a first-of-its-kind telephone service allowing registered nurses to provide help to their patients.
However, Gorevic's career was not always associated with medicine, in the 2000s, he launched an online marketplace for jewelers in New York City but his business was not successful. He then returned to the health care industry in 2002 and five years later, Teladoc reached out to Gorevic to take the CEO position. Gorevic realized how important the scale was and the first thing he did was start to boost the size of the business. Under his leadership, Teladoc acquired over a dozen companies in the industry, expanding its range of services across different categories and geographies.
Teladoc Health, which operates both in the USA and internationally, provides a platform for people to get healthcare from health professionals. Its Primary360 platform allows people to choose a primary care provider, schedule phone or video telehealth appointments, make personalized healthcare plans, or find in-person providers. Following a strong performance during the start of the COVID-19 pandemic, the company is now working on expanding its service offerings. Recently, Teladoc launched a comprehensive mental health service, called MyStrength Complete, that combines app-based tools and coaching with diagnostic, therapy, and psychiatric support. Another growth area for Teladoc is chronic care, which the company is going to address with the help of at-home medical sensors. This segment is particularly attractive as chronic care requires regular visits from a patient during a long period of time, which results in recurring revenue.
Teladoc’s revenues from its subscriber base are something that is expected to make this stock lucrative for the coming years. Although its paid memberships have increased only 1% over the last year, revenue surged 109% over the same period of time. The thing is that Teladoc’s members have increased their usage of the company’s services by 47%. In other words, Teladoc is now even more popular among its members than in 2020, when the U.S. population was forced to spend more time at home due to stricter coronavirus restrictions. The reason for that is the high quality of Teladoc services and the introduction of new products.
Last year, Teladoc’s shares advanced 138% but in 2021, the story changed. The company’s stock fell approximately 50% as investors fear that people will abandon virtual medical visits as the coronavirus restrictions are easing across the world. At the beginning of January 2022, Teladoc's stock dropped 11% and analysts offer two reasons for that. First, investors seem to become more optimistic about the situation around the pandemic despite an increase in COVID-19 cases. Second, the stock market on the whole has been very volatile as the Federal Reserve confirmed that the interest rate would rise. The surge in interest rates can impact the company’s business because it relies on debt to raise additional capital, while higher interest rates mean an increase in borrowing costs. As of September 2021, Teladoc Health had $1.29 billion of debt. In 2021, its debt to equity ratio decreased and was estimated at 7.5%.
Nevertheless, there are no grounds for negative sentiments. Teladoc continuously reports increases in revenue and visits and has even revised its outlook higher. In the recent quarter, its revenue rose 81% and visits were up by 37% to over 3.9 million. Analysts estimate that Teladoc’s growth rate may surpass that of the entire industry. The company expects to reach a CAGR of 25% to 30% during the next three years, including its virtual medical care, mental healthcare, and chronic condition management businesses. Teladoc aims to generate $2.6 billion in revenue in 2022 and $4 billion in 2024.
GoodRx Holdings, Inc. (GDRX) with a market capitalization of $13.6 billion provides a platform allowing U.S. residents to compare prices and get coupons on discounts for prescription drugs. The online platform has 14 million visitors per month and checks thousands of pharmacies in the country. The company was established by former Facebook executives Doug Hirsch and Scott Marlette. GoodRx Holdings also offers professional yet affordable online healthcare services for general medicine, sexual health, and medication refills.
Doximity, Inc. (DOCS), the third-largest telehealth company in the USA, runs a cloud-based digital platform for medical professionals that allows them to collaborate online with their colleagues, coordinate patient care, stay up-to-date with medical news, and carry out virtual patient visits. This is a network similar to Facebook and LinkedIn but specific to healthcare. At present, Doximity is the largest community of healthcare professionals in the USA, with more than 80% of doctors in the country being verified members. Moreover, thousands of physicians have purchased the company’s shares since its IPO. As a group, they own more stock than any other investor.
American Well Corporation or simply Amwell (AMWL) has developed an application that offers urgent care, menopause counseling, pediatrics, telepsychiatry, pregnancy and postpartum care, and more. Additionally, it offers telemedicine equipment, such as telemedicine carts, tablets, and peripherals. Founded in 2006, this Boston-based telehealth company went public last year and now has a market capitalization of $1.6 billion. Although the company has lost 61% of its value since its IPO in 2020, partly because of stiff competition, it can be an interesting option for long-term investment.
First of all, Amwell acquired two promising digital health startups for a total of $320 million to expand its platform offerings. The first one, Conversa, is an automated virtual healthcare company and the other one, SilverCloud Health, is a digital mental health platform. The acquisitions are part of Amwell’s strategy to broaden its work with patients, without limiting it to one-off virtual visits. SilverCloud is a behavioral health platform that offers programs to help people address issues like depression and anxiety by means of cognitive behavioral therapy-based exercises. Conversa Health operates a tool that uses clinical data about patients to generate conversations in-between visits, such as asking how they feel and whether they have taken their medications. The platform automates medical care where possible, detects at-risk patients, and provides telehealth services.
Canada
Like everywhere, in Canada, the COVID-19 pandemic has led to rising interest in telehealth companies. This is particularly true for providers of services facilitating video communication between doctors and patients with the use of a smartphone or a computer. Although the majority of these virtual visits are not fully covered by Canadian health care plans, there are insurers that compensate patients for getting telehealth services or even provide them directly to people. Among the telehealth companies that have seen a surge in interest are Dialogue Technologies Inc. (CARE.TO), Telus Corp., CloudMD Software & Services Inc (DOC.V), WELL Health Technologies Corp (WELL.TO). CloudMD has developed a platform that connects patients and their digital medical records to over 3,000 doctors and practitioners in Canada. In 2020, CloudMD’s shares have more than doubled since the company’s initial public offering, while WELL Health stock increased approximately 300% over the last year.
Telus Corporation (T.TO),(NYSE:TU) operates the largest telecom network in the country and provides access to 99% of the Canadian population. At the same time, the company’s activities are not limited to the telecom industry. Telus Health, a subsidiary of Telus, provides home health monitoring, virtual care, electronic medical records, pharmacy management, and benefits. The company offers a comprehensive app that enables users to get prescriptions, monitor their health, and check symptoms. Some experts believe that this product alone could “drive Telus stock over the next decade”.
In 2019, the company acquired Akira Health, a provider of virtual health services, that has developed a new mobile app called Akira that connects people directly with a certified doctor via text or video chat. Akira doctors have their own practices but spend one day a week to answer the questions of the app users and treat common health issues. The doctors are paid a daily stipend and are authorized to write prescriptions or refer patients to specialists. It is noteworthy, though, that the app cannot replace a specialist and may not accurately make a diagnosis.
Since the beginning of the pandemic, virtual care startups such as Dialogue, LifeSpeak (LSPK.TO), and MindBeacon Holdings Inc. (MBCN.TO) went public and initially benefited from high investor interest in the sector. However, all of them have seen a decline in share prices when investor demand for Canadian tech IPOs cooled down. Maple Corp., one of the country’s leading virtual healthcare companies, was reportedly considering an IPO. But later, Maple co-founder and CEO Dr. Brett Belchetz said that the company had a “very different strategy” that includes continued expansion into the U.S. market and becoming an all-in-one platform for virtual care.
Other Canadian telehealth companies are expanding their international reach by listing on foreign stock exchanges. For example, UniDoc Health Corp. (CSE: UDOC) (FRA: L7T), an innovator in the telehealth sector, is now listed on the Frankfurt Stock Exchange, something that is expected to facilitate the process of trading in its shares by investors internationally. The company offers virtual health and telemedicine solutions in Canada, with its main market including pharmacies, healthcare providers, and hospitals. UniDoc Health Corp. offers Virtual Care Solutions Model, a customizable telehealth solution that integrates a range of physical products, web-based services, and analytical tools, as well as access to a network of healthcare providers, pharmacies, and hospitals.
Despite the growing use of virtual consultations with doctors, Canada is still in the early days of telehealth services, according to a report by Infor Financial Inc. The problem is that Canada’s digital health space is “vastly underpenetrated relative to other developed countries” because doctors are well behind in providing technology-driven offerings to their patients. “We are still in the early innings, but as adoption and usage increases, health data will become a greater focus for all participants and that could lead to some interesting market developments,” the report notes. The federal government is also contributing to the development of the virtual care market in the country, allocating $13.4 million to fund companies and an innovation hub that deals with digital health treatments.
Another problem is that the sector is already saturated with technology startups that will be fighting to stay afloat after the COVID-19 pandemic is over. “Is there really a material difference between two telemedicine platforms if they’re just providing that simple [doctor’s] visit? Probably not,” says Sachin Aggarwal, CEO of Think Research Corporation (THNK.V), a growing digital health company based in Toronto. “What’s going to differentiate these companies in the future is going to be if they’re able to provide some of the more complex workflows that the health care system is going to demand.” In addition to being a maker of digital checklists and telemedicine apps, Think Research also makes software for healthcare providers that helps organize medical data and improve patient care.
Australia
Australia’s virtual care market has seen significant growth in the last few years, driven by government initiatives to promote this type of service in the country. Specifically, the Australian government funds 42% of all health services, including 78% of research. The major publicly funded innovation was the introduction of MyHealth Record, an online platform that aggregates key health information about individuals and provides interoperability between clinical information systems across the entire health sector. Another essential driver for the market growth was the impact of the stringent lockdown imposed in Australia that forced the people to stay at home and opt for video consultations and self-monitoring devices.
The global consulting firm 6Wresearch has estimated that Australia’s telehealth market size will grow with a CAGR of 0.7% in the next five years. The main growth drivers include the increasing aged population and a growing number of people with chronic diseases in Australia. The development of advanced technologies like AI and IoT gives an additional boost to the market. One of the main growth factors is the policy of the Australian government aimed at supporting the industry through subsidies. Last September, the Australian government said it would extend Medicare subsidies for telehealth services with primary care providers and specialists, which was intended to speed up telehealth adoption in the country. Private insurers also expanded coverage of telehealth. As a result, there was a 4,000% increase in private insurance claims for telehealth year over year.
That said, while global investments have significantly increased in the digital health sector over the last year, “Australia is proportionately well behind other nations investing in this space,” according to a report “Digital Health: Creating a New Growth Industry for Australia”. Dr. Terry Sweeney, Head of the Digital Health Cooperative Research Center, notes that Australia needs to rethink some parts of its innovation strategy. “At the moment, Australia’s digital health market is worth about $2 billion, which is just one per cent of the $200-billion global market. We’re purchasing more digital health capability than we’re creating – but we have everything it takes to flip that around,” he said.
Advanced Human Imaging Limited (AHI) is among the largest telehealth companies in Australia by market capitalization ($112 million). The company has developed a smartphone-based human scanning technology that allows users to check, track, and assess their dimensions in conjunction with health risk indicators. A BodyScan app involves taking the user's front and side pictures to assess their body composition and health risks, the FaceScan helps to identify heart health risks, while the Derma Scanner is used to detect skin diseases for more than 500 skin conditions in around a hundred 100 categories. The new HemaScan app, which works as a blood biomarker for chronic disease assessment, is coming soon.
In November, Advanced Human Imaging Limited announced the closing of its IPO of 1,000,000 units at a price of $10.50 per item. The company intends to use the proceeds for product development and marketing. This year, the company reported a 324-percent increase in sales year on year, after a stunning revenue growth of 2,911% in 2020. At the same time, the net margin has considerably dropped this year, while EPS growth was -117%. Advanced Human Imaging is also expanding internationally. In December, it entered into a partnership with the Peruvian-based telemedicine company Nextmedicall, which will help the Australian tech company to expand its presence in Latin America.
Alcidion Group Limited (ALC.AX), which has a market capitalization of $277 million, offers healthcare software products in Australia, New Zealand, and the UK. These include the smartphone and web-based system Smartpage intended for hospital communication and Patientrack, a solution for real-time patient monitoring and risk screening. By April 2021, its stock price had increased 1,000%, after the company signed a deal with Samsung SDS America, Inc. on the distribution of a bundled solution for bedside digital services for patients in the United States.
A number of Australian companies with small capitalization have benefited from the growing market for virtual solutions. Global Health Limited (GLH.AX), which has developed a software platform for storing patients’ electronic health records, targets mental health service providers. The software assists psychologists and psychiatrists in practice management, sharing electronic medical records, billing and invoicing, appointment scheduling, risk identification, and more. Intelicare Holdings Limited (ICR.AX), which went public in May 2020, has developed a platform that tracks and monitors the movement of elderly people in their homes and alerts relatives if something is wrong. The company makes both hardware and software for the monitoring system. ResApp Health Limited (RAP.AX) with a market capitalization of $53 million, has developed solutions for diagnosing and managing respiratory diseases that can be used in telehealth. The smartphone-based ResAppDx app is a diagnostic test for acute respiratory diseases, while SleepCheck is a smartphone app that lets users self-assess the risk of sleep apnoea.
What Companies Will Benefit from Government Policy on Telehealth
American telehealth companies that enjoyed a surge in investment in the midst of the pandemic, are now working hard to safeguard their achievements by means of lobbying Capitol Hill. Lawmakers are yet to decide whether the temporarily eased regulations on telehealth use should be loosened permanently. In particular, providers have been permitted to practice in the states where they are not licensed, while Medicare has been allowed to cover virtual visits, just as it does with in-person ones. If payment for telehealth is curtailed, the industry will be severely affected and some companies may not even be able to stay afloat.
According to Stat News, the industry giant Teladoc (TDOC) is the most remarkable lobbyist in the telehealth field. The company is spending more than it did a year ago — $320,000 in 2021 versus $250,000 in 2020 according to official statistics. Teladoc has been engaged in lobbying activities for many years. Six years ago, the Texas Medical Board made a decision requiring physicians to physically meet patients before they could remotely treat them or prescribe them medications. Teladoc had approximately 2 million subscribers in Texas and that bill harmed the company’s business in the state. The company filed a lawsuit against the Texas Medical Board, arguing the new law would lead to an increase in prices and limit the supply of health care providers. Teladoc voluntarily abandoned the lawsuit in 2017 after the state authorities passed a new bill, which was heavily lobbied by Teladoc, that permitted doctors to treat patients remotely without prior in-person visits. In 2019, Teladoc lobbied against a bill proposed by the North Dakota Board of Medicine that limited telemedicine services. Dr. Donna Campell, a member of the Texas Senate who works with Teladoc, was among those who sided with the company.
The Alliance for Connected Care, among which members are Amwell (AMWL) and CVS Health (CVS), has also increased its expenditure on lobbying. Amwell is also represented by ML Strategies, a government relations firm that works at both federal and state levels. The company’s lobbying efforts related to general telehealth policies and the Telehealth Modernization Act of 2013 in particular. Some telehealth providers that hadn’t been engaged in lobbying activities in the past, such as private companies DispatchHealth and Everly Health, have now hired advocates.
The good news is that there is not much opposition to the expansion of telehealth, with insurers, physicians, hospitals, digital health companies, and employers all being on the same side. However, the lobbyists face two significant challenges. First, some lawmakers fear that greater flexibilities may lead to more Medicare fraud, and, secondly, there is a lack of unity. The problem is that the telehealth company’s lobbying activities are fragmented and decentralized, something that decreases their chance for success. The American Telemedicine Association, which is the principal umbrella organization for the telehealth industry, has a modest lobbying budget of just $30,000 per quarter as compared to $9 million of the American Hospital Association’s quarterly lobbying budget. As a result, some companies have to take matters into their own hands and act independently.
For such large companies as Teladoc and Amwell, the main lobbying issue is ensuring that Medicare will continue to cover telehealth services from homes. Before the pandemic, people had to go to a physical facility for online consultation with a clinician to have it covered by Medicare. GoodRx (GDRX), on the contrary, does not accept insurance and has another priority: the company wants to ensure that telehealth providers will continue to be allowed to practice across state lines. GoodRx runs a telemedicine platform and a website that tracks prescription drug prices. Two years ago, GoodRx hired its first lobbying firm, Faegre Baker Daniels Consulting, to handle drug pricing issues. In 2021, the company’s spending on lobbying activities amounted to $300,000, a significant increase from $60,000 of lobbying expenditures in 2020.
On the 16th of December, major players in the telehealth industry united to create a new campaign called Telehealth Access for America. Giants like Amazon and Walmart are teaming up with Teladoc and the American Hospital Association as well as hospital systems like Johns Hopkins to make sure that the loosened telehealth regulations remain unchanged. Amazon.com, Inc. (AMZN), which is creating its own health care service, spends a portion of its lobbying expenditure on telehealth legislation. Its app-based program Amazon Care connects customers with clinicians through text messages, audio, and video calls. At present, Amazon Care’s services are limited to just several states but the company plans to add two dozen cities by the end of the next year. Amazon has lobbied in favor of 4 telehealth bills in 2021. The most significant one is the Telehealth Modernization Act of 2021, which expands telehealth services under Medicare. In May, Walmart Inc. (WMT) acquired the telehealth company MeMD in order to be able to provide access to virtual care across the country including urgent, behavioral, and primary care. Walmart employs federal and state registered lobbyists and registered lobbyist consultants, with total lobbying expenditures amounting to $4.8 million in 2021. However, none of the bills the company lobbied related to telehealth.
Recently, a number of insurance giants such as Aetna, UnitedHealthcare, Cigna, and Humana have introduced their virtual health plans. Cigna Corporation (NYSE: CI), one of the 20 biggest lobbyists in the healthcare domain, spent $5.7 million on lobbying in 2021. This spring, Cigna’s subsidiary Evernorth acquired MDLive, a leading telehealth provider of online and on-demand healthcare services and software. In 2020, Cigna lobbied two bills related to telehealth services — H.R.6644 and H.R.7659.
Aetna is an insurance provider owned by CVS Health (CVS) which has spent $4.9 million on lobbying in 2021, including telehealth bills. The private company UnitedHealthcare, which is the country's largest insurer with total lobbying expenditures of $2.7 million, has launched a telehealth care-centric insurance plan. The American health insurance company Humana Inc. (HUM), whose total lobbying expenditures amounted to $3.6 million in 2020 and $2.9 million in 2021, has also expanded its business in telehealth services. The company lobbied at least one telehealth bill — the H.R.7659 bill that allows providers to offer audio-only telehealth services to MA enrollees. In 2020, the company expanded the availability of telehealth services for its members to help reduce exposure risk from the COVID-19 virus. The same year, it invested $100 million in the telehealth start-up Heal that provides an Uber-like doctors-on-call service. At the beginning of the year, Humana partnered with DispatchHealth to launch a home healthcare service that includes remote patient monitoring.
This summer, the Biden administration invested $19 million in expanding telehealth in rural areas and underserved communities. The investments will help to pilot new telehealth services and track outcomes in rural medically underserved areas. However, the Biden administration released new data recently that questions whether telehealth can promote health equity, taking into consideration that black patients are less likely to access this kind of service than white Americans. Anyway, the lawmakers are yet to decide which regulatory flexibilities will remain after the pandemic is over, and which should be removed.