Increased membership, revenue and visits were all highlights of Teladoc’s fourth quarter for 2016, and it was a big year overall for the telemedicine provider. During the company’s fourth quarter earnings call with investors, Teladoc executives shared strong numbers across the board as well some strategic partnerships and legislative advancements they believe will keep them on an upward path.
“As we reflect on our solid 2016 performance, I am proud of the company and the industry milestones we have set as we continue to execute on our mission to transform the healthcare experience for our members, clients and partners,” Teladoc President and CEO Jason Gorevic said on the call.
The company also took the opportunity to announce the appointment of Ken Paulus to Teladoc’s Board of Directors. Paulus is the President and CEO of Allina Health, a system of healthcare systems of clinics, hospitals and specialty care centers.
Teladoc’s membership swelled to 17.5 million, a 43 percent increase year-over-year. The company recorded 310,467 visits for the fourth quarter, up 68 percent from Q4 2015. There were 952,081 for the year, representing a 65 percent jump. Total revenue was $37.4 million for the fourth quarter of 2016, representing an increase of 65 percent from last year. Similarly, the full year revenue was up by 59 percent, bringing Teladoc’s 2016 total to $123.2 million
“During the year, we completed our company’s 2 millionth telehealth visit, representing savings through our clients in the U.S. healthcare system of over $900 million,” Gorevic said on the call. “As context, it took us about 12 years to reach our first million visits, while only 14 months for our second million. This clearly signals the inflection point in overall telehealth adoption.”
Gorevic said the company also crept over 600,000 downloads of their family of mobile apps in 2016, which he said shows increasing consumer engagement. The company saw growth across each of their sales channels and market segments, with the core market of health plans and large employers bringing in 1,500 new clients. Some of the company’s notable new enterprise clients include Bed, Bath & Beyond, Takeda, Magellan and Petco, although Gorevic noted their small-to-midsized employer segment is one of their fastest growing channels.
“Meanwhile, existing clients like Rolls-Royce and Huntington Ingalls have embraced our 3-way caregiver technology platform that we pioneered with AARP, proving the broad appeal of our many solutions,” Gorevic said. “Additionally, we continue to have great momentum in the provider market as our client roster now stands at over 110 hospitals and health systems, up from approximately 60 at this time last year, including recent additions, such as Einstein Health and Silver Cross.”
Another factor driving the gains was existing clients’ expansion of Teladoc’s offerings to their employees.
“Our behavioral health offering, which more than doubled in 2016 to approximately $12 million in revenue, showcases consumers’ accelerating acceptance of the telehealth channel for behavioral health visits,” Gorevic said. “In 2017, we expect behavioral health to continue to be a significant growth driver.”
Teladoc also made recent efforts to extend the reach of telehealth through partnerships with digital health innovators, including their collaboration with Kinsa, makers of an FDA-cleared smart thermometer, an expanded relationship with lab testing company Analyte Health and primary care referral service Compass Health.
“While these partnerships will start small in contribution, they represent critical steps in further enriching our consumer engagement efforts,” Gorevic said.
Asked if these moves suggest Teladoc is getting into remote monitoring, Gorevic explained the company was interested, yet cautious. While Kinsa was chosen because it is practical and approachable, more complex tools require careful considerations that could take awhile to flesh out, Gorevic said.
“So we look at the remote monitoring space quite a bit. I would say our first step into that is not exactly remote monitoring, but we did a partnership with CareCentrix around the home care space, where a home care nurse can bring one of our physicians into the home virtually to help assess a patient,” he said. “Remote monitoring gets to the next level of clinical integration. And so we are starting to talk to some hospital systems primarily about what they are doing and how we could be helpful to them. But it’s not I wouldn’t call it immediate on our product roadmap. It’s a little further out relative to the next, let’s say, 9 months to 12 months.”
As for what they plan to add over the next few months, Gorevic said to expect a slight slowdown. In the last 12 to 14 months, Teladoc added five new service lines between behavioral health, dermatology, tobacco cessation, a caregiver product, and their sexual health program.
“We have done a tremendous amount of product development. My first focus is on making sure we get traction and we harvest the investment that we have made in those products. And that doesn’t mean that we are going to stop, of course,” he said. “You will continue to see us add new clinical areas, but I wouldn’t say we are likely to do it at the same cadence that we did last year. We will be a little bit more measured over the next several years as we add new [adjacent services], clinical services and/or product offerings that perhaps, in some cases, we will partner for, in other cases, we will build ourselves.”