Early data finds telehealth is largely cost neutral
Virtual visits remain popular for mental health
ONE Of THE BIGGEST shifts in health care during the COVID-19 pandemic was the sudden launch of telehealth. Before COVID, doctors and hospitals rarely offered video visits and very few patients ever used telehealth. Suddenly, when doctors’ offices largely shut down in March 2020 and patients feared returning once they reopened, telehealth burgeoned in popularity, spurred by emergency orders requiring equal insurance reimbursement.
As society returns to a new normal, many questions remain about telehealth. How will it be most useful? Will it save the health care system and consumers money, or will it add to costs?
A subcommittee of the Massachusetts Health Policy Commission took a first stab at beginning to answer some of these questions Wednesday, at a meeting where commissioners reviewed telehealth data from 2020. While the lag in timely data limits their analysis, early trends show that telehealth does not add costs to the health care system, but also provides very limited cost savings. Telehealth appears most useful for mental health, where visits have continued at high rates even as physical health visits largely returned to doctors’ offices.
Health Policy Commission member David Cutler, a Harvard economics professor, said while policymakers hoped telehealth would save money, it could still be a positive innovation because it is getting more people to attend behavioral health visits. “On one hand, it’s bad it hasn’t saved us money. But we also know people aren’t getting enough primary care visits and behavioral health visits, so anything we can do to get people more primary or behavioral health visits is probably good regardless of whether it saves money,” Cutler said.
Part of the question around costs revolves around whether people will have a telehealth visit, then get told to come into an office, resulting in added costs. Yue Huang, a research associate at the Health Policy Commission, said the data indicate what he calls a substitution effect. “Telehealth visits aren’t added on top of in-person visits,” Huang said. “People are using telehealth to substitute for some of the in-person care.”
The data released Wednesday includes information about people under 65 with commercial insurance.
At the beginning of the pandemic, in April and May 020, telehealth was the only option for many types of visits, and around 60 percent of visits were conducted by telehealth. But as doctors’ offices reopened, the impact of telehealth waned and it became clear that its enduring use was for mental health care.
By December 2020, the data found, 16.1 percent of visits for non-mental health reasons were conducted via telehealth compared to 81.2 percent of mental health visits. Sixty-three percent of all telehealth visits in 2020 were for mental health reasons, compared to 16 percent of office visits. Mental health visits lend themselves better to telehealth since they are talk-based rather than requiring a physical exam.
Every major health care provider had between 82 percent and 93 percent of mental health visits conducted via telehealth in 2020. However, the percent of non-mental health visits conducted via telehealth ranged more widely, from 37 percent to 60 percent depending on the provider. Physicians affiliated with Mount Auburn, Beth Israel, Atrius, and Mass General Brigham had some of the highest rates of telehealth use, while Reliant, South Shore, and UMass had the lowest.
Some of the biggest enduring questions around telehealth are about payments. Early in the pandemic, an executive order required that insurers reimburse for telehealth equally to in-person visits. Gov. Charlie Baker signed a bill in January 2021 that required permanent payment parity for behavioral health, and two years of payment parity for primary care and chronic care management. The latter will sunset January 1, 2023, and lawmakers must consider whether to mandate payment parity for longer or leave it to insurers.
The commission used a complicated method to compare similar patients in areas with high rates of telehealth usage and areas with low rates of telehealth usage to determine the overall impact on spending.
Sara Sadownik, deputy policy director at the Health Policy Commission, said health care providers told the commission that offering telehealth did not decrease their costs. Since providers were still offering in-person care, they could not significantly reduce their office expenses, but they had added expenses related to telehealth technology.
One related experiment that occurred in 2020 surrounded consumer costs for telehealth. At the beginning of the pandemic, all the major insurers largely waived copays for telehealth, but Harvard Pilgrim reinstituted copays for telehealth that September. That change let analysts compare how telehealth usage changed based on copays. The Health Policy Commission data found that reinstating copays did not appear to change how many people used telehealth.David Seltz, executive director of the commission, said it appeared that, if both office visits and telehealth carried copays, people preferred telehealth.
Sadownik said many questions still exist, like whether to pay for video visits differently from phone calls or how to handle third-party telehealth companies like Teledoc. Sadownik noted in her presentation to the commission that one major benefit of telehealth is it offers increased access to care, particularly for patients with chronic conditions and those who live far from a medical center.