Many forces have been driving the growth of telehealth over the past decade, including value-based reimbursement models, population health management trends, and technology advancements. As we have discussed in previous blog posts, the COVID-19 pandemic was the jet fuel that propelled telemedicine utilization into the stratosphere. This growth was, in large part, due to the necessity of limiting in-person contact to avoid widespread COVID-19 transmission. In fact, as COVID-19 began to spread across the United States, the Centers for Disease Control and Prevention (“CDC”) advised health care providers to offer care via telemedicine technologies wherever appropriate. However, not all of this growth in the telehealth space can be attributed to the necessity of social distancing during the pandemic; even as transmission of COVID-19 has slowed in many areas, providers continue to offer telehealth for patient care, and patients continue to utilize it.

Notably, telehealth utilization has not sustained the record-breaking levels that we saw at the start of the pandemic. During the height of the pandemic, over 32% of total outpatient visits occurred via telehealth. Beginning in February 2021, telehealth utilization has begun to decline, with utilization levels now appearing to have stabilized at 13 to 17% of total outpatient visits. A monthly telehealth tracker tracks the month-to-month change in telehealth claim lines, which represent individual telehealth-related services that appear on insurance claims and are a useful guide to the change in telehealth utilization over time. Data from the tracker confirms that telehealth utilization has decreased in the first few months of 2021. However, although these decreases in telehealth utilization may appear significant at first glance, increases in telehealth utilization in 2020 were staggering. Thus, even some decrease in telehealth utilization in 2021 compared to 2020 levels likely does not represent a trend backwards to the telehealth utilization levels we saw in 2019. In fact, one estimate suggests that telehealth utilization is still 38 times higher than pre-pandemic levels. Furthermore, it appears that providers generally expect that telehealth is here to stay; a recent poll asking healthcare leaders what they expected to see with respect to telehealth utilization trends demonstrated that 65% of healthcare leaders expect telehealth utilization to remain at pandemic levels, or even increase, in 2021.

Ultimately, though, the ability of providers to continue to provide telehealth services at profitable levels depends on whether laws and regulations allow for it. During the pandemic, the Centers for Medicare and Medicaid Services (“CMS”), as well as state governors and legislators, relaxed laws and regulations, allowing for greater flexibility in the provision of patient care through telemedicine. Some of these changes are here to stay. For instance, earlier this month, in its proposed update to the Physician Fee Schedule, CMS proposed allowing certain telehealth services added during the pandemic to remain on the list until at least the end of 2023. Additionally, CMS proposed removing certain restrictions on accessing mental health services via telehealth, allowing greater flexibility for beneficiaries seeking to access mental health services using telemedicine technologies. However, as we have reported in a previous blog post, some states, including New York, have started to pare down regulatory flexibilities at the state-level in 2021. Further regulatory changes in the field of telehealth are likely still to come as emergency and temporary waivers are pulled back.

Now that telehealth has become pervasive throughout the country, it stands to reason that it will continue to play an important role in healthcare delivery for the foreseeable future.  Telehealth remains an important tool to help providers engage patients, increase access, provide patient-centered care, and be successful under value-based reimbursement models.

Photo of David Manko David Manko

David has more than two decades of experience representing clients in the health care industry. His experience includes complex business transactions such as mergers, acquisitions, joint ventures and other contractual relationships. He is particularly adept at structuring health care transactions that implicate regulatory…

David has more than two decades of experience representing clients in the health care industry. His experience includes complex business transactions such as mergers, acquisitions, joint ventures and other contractual relationships. He is particularly adept at structuring health care transactions that implicate regulatory issues such as the Corporate Practice of Medicine, the Stark Law and the Anti-Kickback Statute. Recently, David has been highly involved in representing sponsors and targets in private equity transactions involving health care technology companies, physician practices, MSOs and other service providers. He also has experience unwinding transactions that have not achieved the objectives of one or both parties.

In 2017, Chambers USA recognized David as a regulatory and transactional healthcare lawyer “who earns impressive reviews from peers and clients alike.” Says one commentator, “he is a master negotiator and is second to none in his responsiveness,” adding that “he turns around whatever needs to be done promptly and efficiently.”

Photo of Krusheeta R. Patel Krusheeta R. Patel

Krusheeta Patel is an associate in the Corporate Department and a member of the Health Care Group.

Krusheeta received her J.D. from Columbia Law School, where she participated in the Adolescent Representation Clinic and was a Staff Editor for the Human Rights Law

Krusheeta Patel is an associate in the Corporate Department and a member of the Health Care Group.

Krusheeta received her J.D. from Columbia Law School, where she participated in the Adolescent Representation Clinic and was a Staff Editor for the Human Rights Law Review. As a participant in New York’s Pro Bono Scholars Program, Krusheeta spent her final semester of law school working at Lenox Hill Neighborhood House with the Health Care and Benefits team. Krusheeta earned her B.A. in Health and Societies with a concentration in Health Care Markets and Finance from the University of Pennsylvania, graduating magna cum laude.