Telehealth was a godsend during the pandemic; Congress should keep the innovation going

When it comes to health policy, “as Medicare goes, so goes the nation.” Unfortunately, burdensome federal regulations prevented Medicare from delivering virtual care to millions of seniors around the country — until the COVID-19 pandemic.

Lawmakers enacted these restrictions because they feared making telehealth widely accessible would lead to patients using unnecessary health care services. Many private insurers followed Medicare’s lead and similarly limited access to many telehealth services.

But when confronted with the crisis of coronavirus, which shut down large parts of the economy and forced families to stay home to reduce the spread of infection, state and federal lawmakers dropped those objections, rightly concluding that telehealth would help people access care during the emergency.

The U.S. Department of Health and Human Services used emergency powers to temporarily suspend a variety of regulations to allow Medicare recipients to remotely access care through telehealth. Similarly, officials in all 50 states took actions to expand access to virtual care for individuals covered by private insurance.

It worked. Telehealth provided a vital link for tens of millions in rural areas and for those at high risk who needed to avoid visits to doctors’ offices.

A new report by our organizations, Americans for Prosperity and the Progressive Policy Institute, used data from FAIR Health to show that  concerns about higher costs and overutilization are largely unfounded.

Between January 2020 and February 2021, people who used telehealth had lower overall health care utilization compared with those used in-person care exclusively, except during the chaotic early months of the pandemic, March to May 2020. This counters the commonly held narrative that making care easier to access would increase unnecessarily utilization of health care services.

Furthermore, our study found patients who use telehealth spend dramatically less on health care services over time. Between January 2020 and February 2021 — though telehealth patients’ costs started out higher than in-person patients’ costs — the average telehealth patients’ health care expenses ultimately fell 61 percent, from $1,099 per month to $425 per month. In a post-pandemic world, it’s likely that telehealth continues to reduce health care costs on a permanent basis.

In the first half of 2010, pre-pandemic, only 134,000 Medicare enrollees received weekly virtual care. After restrictions were lifted, that number increased more than 7,400 percent to 10.1 million between January and June 2020. 
Removing state and federal barriers also expanded telehealth use among individuals with commercial health plans. Prior to the public health emergency declaration in January 2020, providers delivered only 1.5 percent of health services through telehealth, according to claims data compiled by the COVID-19 Health Care Coalition. After these reforms took effect, providers delivered nearly 24 percent of all services through telehealth.

Did these increases prove that the administrators’ fears of overutilization were correct? Not at all.

Our study showed that for seven of the 10 observed conditions, the average number of total appointments with the health care system — one way to measure utilization — was the same or fewer for people who used telehealth relative to people who did not. The only conditions where utilization was higher were anxiety disorders, mood disorders and communicable diseases — conditions exacerbated by a global pandemic. 

Armed with this kind of evidence, lawmakers need to provide greater access to telehealth for more patients and set a new example for private insurers by lifting restrictions on telehealth permanently

Sens. Brian Schatz (D-Hawaii), Joe Manchin (D-W.Va.), and Tim Scott (R-S.C.) have each introduced bipartisan measures to preserve the telehealth reforms HHS implemented during the pandemic that allow providers to deliver virtual care. Efforts are underway in many state capitals as well.

We live in a different world than the one in which only handful of private and Medicare Advantage plans were early adopters of telehealth, when some providers were reluctant to innovate for fear that it would disrupt their practices and hurt their incomes.

Telehealth has proven a godsend for millions of Americans. It helped us navigate the treacherous months of the pandemic, and brought millions safety and security.

But when the COVID-19 crisis is officially declared over, the restrictions will snap back into place. To meet the needs of those patients now, and to ensure we are better prepared when the next emergency hits, Congress and state lawmakers should not let that happen.

Charlie Katebi is a health policy analyst at Americans for Prosperity. Arielle Kane is director of health care policy at the Progressive Policy Institute.