About the Authors: Ian Chiang is a principal at Flare Capital Partners, a healthcare technology and services-focused VC firm. Prior to joining Flare, he was the SVP of product and innovation and a founding member of Cigna’s CareAllies. Previously, he was a digital health entrepreneur and a former management consultant at McKinsey & Company.
Poorwa Godbole is an MBA candidate at the Wharton School concentrating in Health Care Management and a Flare Capital Scholar. Prior to Wharton, she was a management consultant at McKinsey & Company focused on health systems and services and a member of the Health & Life Sciences team at Gates Ventures. She is a graduate of Stanford University.
Disclaimer: Flare Capital Partners is an investor in Bright Health, Eden Health and Iora Health.
Healthcare delivery has undergone unprecedented changes in the past decade. Over the past five to 10 years, healthcare's digitization has accelerated exponentially due to innovative government policies, changes in consumer preferences, an influx of venture capital, a growing number of digital health entrepreneurs and continued investments by industry incumbents.
The COVID-19 crisis has highlighted some of the challenges in our healthcare system and presented unique opportunities for the U.S. healthcare system to innovate in real time. Across the board, we have seen healthcare providers adopt telehealth at an unprecedented rate. While the last chapter of COVID-19’s impact on the evolution of our healthcare delivery system is far from being written, we would like to highlight 10 major care-delivery trends accelerated by COVID-19.
Virtual healthcare delivery is becoming a must. The divide between physical and digital care is blurring.
1. Virtual-first primary care took center stage during COVID-19, and the transition is here to stay.
Telemedicine (or telehealth) is not a novel concept. (See the history.) Yet adoption was slow for both patients and providers in the early years. The COVID-19 crisis has ushered in unprecedented changes and made virtual health more mainstream. During the early days of COVID-19, numerous primary care providers across the U.S. were forced to shut down their physical facilities. As a result of this sudden shock, many aggressively adopted and rolled out telehealth. In some cases, advanced primary care groups, such as Iora Health, converted almost all care to a virtual setting.
“Because of our value-based payment model and team-based delivery model, we were able to do the right thing when [COVID-19] hit – quickly pivot to doing over 90% of our encounters by phone and video, and proactively reach out all of our patients over the first few weeks and many times thereafter, reminding them to stay distanced and wear masks,” Rushikia Fernandopulle, Iora Health’s CEO, said.
“Telehealth was a priority at Privia even before COVID-19,” Shawn Morris, CEO at Privia Health, said. “We invested in building our own solutions. We did 400,000 plus virtual visits in the early days of COVID-19, including 60,000+ unique senior visits. About 20% of our patient encounters are done virtually, and we can certainly do more.”
Most health systems have also observed a surge in virtual visits (e.g., Ochsner sees nearly 1000% increase in virtual visits in March 2020).
While not all primary care practices were equipped with internally developed technologies to scale telemedicine operations rapidly, many were able to adopt SaaS platforms, such as doxy.me. Despite the range in readiness found across providers, Bain & Company reports that by April 2020, 97% of primary care physicians were using telemedicine to treat patients, primarily for non-COVID-19 or nonurgent care.
It’s likely no coincidence that this acceleration in demand for virtual health closely preceded a new annual record for digital health funding led by mega deals in virtual care delivery (e.g., AmWell’s nearly $194M Series C round in May and eventual IPO in September). Though the huge jump in demand for virtual care dropped in recent months as the country opened up, many care delivery organizations are still seeing significant utilization of virtual health and expect at least one-fifth to a quarter of patient encounters to be done virtually going forward (See John Halamka’s interview).
For providers, “Telehealth is a great tool to help doctors provide better care, enhance the patient experience and expand panel size and access,” Morris said.
While virtual primary care will not replace 100% of in-person care visits, we believe that the primary care delivery landscape will be profoundly changed going forward, due to the increased adoption of virtual health and acceleration toward value-based reimbursement.
“Because of Iora’s value-based business model, when the pandemic hit, our revenue did not change one bit due to the shift to virtual care,” Fernandopulle said. “For years traditional practices have claimed they have been trying to operate in both the fee-for-service and value worlds at the same time – with one foot on the dock and the other in the canoe. What [COVID-19] has shown is that the dock is now on fire … so it’s time to get both feet in the canoe and start paddling!”
2. Specialty care will be increasingly virtual, improving access and affordability. Disease-focused solutions will flourish, with full-stack offerings following suit.
Like primary care, a large portion of specialty care has also shifted to virtual delivery during the COVID-19 pandemic. However, the expected permanence of these virtual models will vary by specialty.
On one end of the spectrum, there are procedure-based specialties that cannot exist solely digitally. (See “Telehealth usage as percent of total visits” by specialty) For instance, many procedures in specialties like ophthalmology and orthopedics have been delayed due to a temporary ban on elective surgeries during the early months of COVID-19 (e.g., one study estimated a backlog of one million-plus cases for spinal fusions and joint replacements in the field of orthopedic surgery alone).
These surgical procedures will return in the post-pandemic world, and while we do not anticipate procedures being done virtually, we foresee a shift towards increasingly virtual preoperative and postoperative consultations.
On the other end of the spectrum, we saw an accelerated movement of some specialties or subspecialties into the virtual world. In recent months, we have seen many digital health companies that offer ongoing care and management of specific conditions or diseases (e.g., hair loss, sexual health, migraine, sleep and behavioral health conditions) enjoy rapid growth.
For example, Thirty Madison has a full process in place for diagnosing a patient’s hair-loss condition, creating a treatment plan and sending a treatment supply directly to the patient without any in-person interaction. AbleTo, Talkspace, Lyra Health, Octave Health, Mindstrong and others offer virtual therapy, coaching and digital measurement for mental health support. During COVID-19, these companies have provided patients with much-needed specialty care, while their brick-and-mortar peers were forced to shut down temporarily.
Reliance on virtual care solutions for behavioral health continues to be high as of October 10, when in-person visits to behavioral health providers were still 14% below pre-pandemic levels. On top of their commercial traction, these virtual specialty care providers have shown that they can raise mega-funding rounds during the height of COVID-19 (See: Mindstrong announces $100 million funding, Lyra raised $110 million Series D funding and Cerebal lands $35M). We believe these strong commercial and financial tailwinds will lead to the creation of a new generation of virtual specialty care providers.
Additionally, we see a rise in uptake of virtual specialty care-enablement platforms. For example, Heartbeat Health is the developer of a telemedicine and virtual care platform for cardiologists. Technology platforms like Heartbeat Health were vital during the pandemic, which caused 75% of cardiology outpatient encounters to shift to telehealth within just two weeks.
The use of these tools across the country has demonstrated how virtual delivery can increase access to care, improve efficiency and patient satisfaction, and provide a more personalized and coordinated experience. Virtual health-enablement platforms in other specialties (e.g., Babyscripts in OBGYN) have also flourished.
"Payers and ACOs are looking closely at radically reducing costs in high-prevalence, high-cost conditions like [cardiovascular disease]. Many will seek Virtual First players who are willing to go at sub-risk," Dr. Jeff Wessler, CEO of Heartbeat Health, said.
The movement from fee-for-service to fee-for-value will also serve as a tailwind for the rise of virtual specialty care providers or enablement platforms.
Furthermore, the emergence and incorporation of virtual specialty care will likely be hyper-charged in the post-pandemic world. Digital health behemoths, like Teladoc and Livongo, are joining forces to accelerate the development of an integrated, “full-stack” specialty care platform. In its S4 filing, Livongo highlighted the potential for the merged company to create the next generation of specialist care – offering both medical specialty care and chronic-condition-management services in a combined, remote solution that augments standard care.
3. Care will increasingly be delivered asynchronously, with most provider-patient interactions involving a blend of synchronous and asynchronous communication.
Across primary care and specialty care, we see providers beginning to use an increasing mix of synchronous and asynchronous delivery. Some types of asynchronous care (e.g., forwarded X-rays or MRIs to be interpreted by a radiologist) are well established. But with the shift towards more virtual care, other types of asynchronous communication, such as text and media messages, are increasing in utilization, both for patients to consult with their physicians and for physicians to consult with other specialists.
Asynchronous care delivery amplifies telemedicine's benefits and increases patients’ access to low-cost, high-value care. For instance, a patient requiring non-emergent care for a skin rash can now send a photo to her primary care provider. Instead of commuting to the doctor's office, spending time in the waiting room and only getting a few minutes with the physician, the patient can now go about their day at home and take the appropriate steps when the provider replies asynchronously.
The use of asynchronous care also increases provider efficiency. Physicians can now see a full panel of patients in person without limiting their ability to provide virtual care. The asynchronous nature of the visit allows physicians to respond to requests at their convenience.
This also creates opportunities for quality improvement. Physicians have more time to gather a patient’s full history and data, research hypotheses and consult with others before responding to a patient. Providers can also see all the patient data in a structured, standardized format, allowing them to potentially complete three to six visits in the time it would take to do one synchronous visit. Companies like Zipnosis are taking advantage of asynchronous care and "store-and-forward" solutions to improve both the patient and the provider experience.
While asynchronous care delivery is growing, a synchronous chat or text is simultaneously emerging as a dominant model. Some synchronous chat applications (e.g., KHealth and 98point6) combine artificial intelligence with physician expertise. Patients begin by chatting with a bot to discuss symptoms and get an initial diagnosis.
If needed, a physician will then chat with the patient live to discuss next steps or prescribe a care plan. These synchronous chat applications are becoming more and more popular (e.g., 98point6 raises $118 million) and integrated with other providers. In September, Sam’s Club announced a collaboration with 98point6 to provide members discounted subscriptions to the text-based app and virtual visits for just $1.
While some pundits are concerned about the quality of synchronous text/chat-based and asynchronous care, a study at Stanford Health Care has shown asynchronous teledermatology to be effective in increasing access and maintaining high-quality care. Companies like hims, Alpha Medical and Thirty Madison are already putting these results to use and creating a physician-patient experience that is centered on chat or text.
Eden Health, which offers virtual-first primary care and onsite clinics to employers, is experiencing the rise in demand for asynchronous and synchronous virtual care during the pandemic.
“Medical problems are rarely solved in a single experience, so we see messaging interactions continuing to increase as patients get exposure to its ease and effectiveness,” Matt McCambridge, CEO at Eden Health, said. Combining the convenience of messaging with the power of face-to-face video appointments in a single application creates a seamless and positive experience for our patients,”
As millennials and Generation Z become more engaged healthcare consumers, we believe that synchronous and asynchronous interactions will continue to gain prominence as the preferred mode of engagement, especially in primary and low-acuity specialty care.
4. As remote working becomes more prevalent, employer health offerings will become increasingly virtual and home-centric.
According to a PWC Health Research Institute survey, 38% of large employers offered an onsite health clinic in 2019, up from 27% in 2014. Just as these numbers are rising, the COVID-19 pandemic has caused many companies to operate with a primarily remote workforce. Though working from home may become part of the new normal, employees will still expect easily accessible and affordable care from employers.
“Healthcare is no longer viewed only as an employee benefit. It’s now a necessity for maintaining a strong workforce,” McCambridge said. “With a large percentage of employers now embracing liberal work-from-home policies, access to healthcare for distributed workforces is critical. This mindset shift has accelerated demand for virtual primary care, and interest in our telemedicine solution from employers has surged by more than 500% since the beginning of the outbreak in March.”
To meet this demand, employers will need to explore virtual care delivery options. Incumbent employer/work-site health providers (e.g., Marathon Health, Premise Health and Cigna Onsite Health) have adopted or expanded virtual health during COVID-19. Other well-known employer-focused medical groups with 24/7 virtual capabilities have seen significant growth in membership. (One Medical saw a 25% increase in year-over-year membership growth in Q2 2020.) In addition to virtual-first solutions, employers and commercial health plans are actively exploring ways to extend care, especially urgent and emergency care, to employee/members’ homes. (See Trend 8.)
Whether partnering with a virtual-first employer health-solution provider, expanding telehealth benefits or adding home-based care delivery options, employers across the U.S. (and around the world) are actively looking to meet their employee’s healthcare needs in a multimodal fashion.
5. Healthcare providers will expand the use of AI-based triage tools to direct patients to the appropriate site of care in a highly efficient manner.
In the wake of the pandemic, many prominent hospital systems are using virtual encounters to provide safer and timely care. For instance, at the University of Pennsylvania Health System, telehealth is being used across the board – to understand a patient’s symptoms and let them know if they need to visit the ER, reduce ICU interaction and provide therapy over the phone. Systems and government agencies have rapidly adopted AI symptom checkers (e.g., GYANT, Ada, Babylon and Buoy Health) to improve patient experience and to handle increased volume in a cost-effective manner.
For example, Intermountain Healthcare jointly developed a COVID-19 Screener and Emergency Response Assistant (COVID-19 SERA) with GYANT and rolled it out in April of 2020. Intermountain has seen a 30% decrease in call center volume, which frees up patient-clinician communications for those who need it most. Other health systems have also adopted similar tools. (See: Montefiore using Hyro and Syllable.AI powering New York Presbyterian’s COVID-19 web bot.)
While we are still in the early innings of AI-based triage, and more complex clinical algorithms will need to be developed to facilitate smarter triage, there is no doubt that AI-based triage tools will play a significant role in changing the way healthcare providers will evaluate and direct patients to the most appropriate site of care going forward.
6. Healthcare for rural populations will be more virtual to ensure accessibility of services.
Providing healthcare in rural areas is challenging on multiple dimensions – large elderly populations with multiple comorbid conditions, many uninsured patients and lack of specialists. Many providers already operate at a loss, which has deepened during the pandemic when elective procedures (which typically make up half of a hospital’s revenue) were canceled or delayed.
According to the Texas Commissioner of Rural Health, 60 of the 163 rural hospitals have less than 30 days of cash on hand. Some of these facilities are looking to telehealth solutions to stay connected to patients during this time. (See: Ballad Health announces major expansion of virtual health program to lower cost and improve urgent care access.)
As we look forward to the role that telehealth will play in primary care in rural areas, we believe the adoption of virtual health will be further accelerated by innovative funding models (e.g., CHART) from the Centers for Medicare & Medicaid Services (CMS) Innovation Center.
COVID-19 will also have a lasting impact on access to specialty care. Platforms like RubiconMD and AristaMD that connect primary care doctors with specialists for eConsults help to improve access to specialty care in rural areas, where wait times for referrals to see a specialist could be exceedingly long.
“Rural medicine is facing a shortage of over 20,000 physicians, a resource strain that has only intensified with the global pandemic,” CEO of RubiconMD Gil Addo said. “It's more important than ever to empower PCPs in rural areas to provide the most comprehensive care possible. eConsults through RubiconMD allow these doctors to receive same-day insights from specialists across the country, improving care and saving patients unnecessary appointments and the often long, burdensome and costly trips that go along with them."
Going forward, we believe there will be an increased demand for eConsults in both outpatient and inpatient settings, especially at rural facilities where access to specialists is limited. (See: Avail raises $100M for telemedicine in the operating room.) We also believe that virtual primary care will be more ubiquitous in rural areas.
While there is still a digital divide between rural and urban areas, the Federal Communication Commission (FCC) has moved aggressively to expand broadband access across America. We anticipate that additional funding will increase broadband and high-speed wireless Internet access in rural America in the post-COVID-19 world and further accelerate the adoption of innovative virtual health services.
Increased adoption of value-based care and reimbursement parity for virtual care will also accelerate the shift toward delivering care in the home and community.
7. Remote patient monitoring (RPM) will be an integral part of patient care going forward.
With healthcare facilities reaching capacity, patients fearing contracting illness from entering a doctor’s office, and with high-risk patients needing to stay away from others, COVID-19 has everyone thinking about the future of care delivery in the home. Though providing care virtually removes the human touch from medicine, it also enables a physician to see a patient’s home environment and potentially discover factors affecting a patient’s health that may not be obvious when examining the patient in the office.
In addition to basic virtual visits, RPM technologies (e.g., TytoCare, Current Health, Vivify Health, Harmonize Health, AliveCor and Eko) and home-based point-of-care diagnostic (POC Dx) tools (e.g., Scanwell Health) allow clinicians to actively examine or passively monitor their patients.
Prior to COVID-19, CMS expanded the reimbursement of RPM services in its final rule on Chronic Care Remote Physiologic Monitoring in November 2019. Increased adoption of value-based care, and providers taking on the financial risk of managing chronically ill patients, have led to increased investment in RPM solutions. According to one study from 2019, 88% of providers surveyed have invested or are evaluating investments in RPM technologies. Even telecom giants like Comcast are riding these tailwinds. (See: Comcast's launch of Quil Health for RPM for aging seniors.)
Payment reforms, adoption of value-based care payment and COVID-19 subsidies will undoubtedly usher in integration of traditional telemedicine, RPM and home-based POC Dx. In a podcast conversation with Senator Bill First, Dr. Eric Topol – a renowned cardiologist and author – predicts we will soon be in a “Telemedicine 2.0” world where patients can actually collect and share health data with their physicians in order to receive care at home. The merger between Teladoc and Livongo may foreshadow what is yet to come.
8. Chronic condition management, hospital-level emergent care and inpatient-level care will increasingly take place in the patient’s home.
During the height of the COVID-19 crisis in many states, we witnessed an overwhelming demand for hospital beds for critically ill patients, and many hospitals converted various wards into ICUs. As a result of an actual or anticipated surge in need for hospital beds for COVID-19 and other severely ill patients, many health systems around the country have accelerated their efforts to stand up hospital-at-home (HaH) programs to provide hospital-level care in the patient’s home. (See: Intermountain’s Castell launched its HaH program Mayo launched advanced care at home model of care.)
In the post COVID-19 world, it is more important than ever to provide hospital-level care to high-risk patients directly from advanced primary care settings.
“The hospitals of the future will expand virtually into homes to provide appropriate acute-level care,” Rajesh Shrestha, Castell president and CEO and Intermountain VP and COO for community-based care, said. “Intermountain Healthcare and Castell Health launched this new service to support patients who are at risk for hospitalization or complications.”
Additionally, COVID-19 has exposed the downside of relying on fee-for-service revenue for many health systems. In the aftermath of COVID-19, we anticipate health systems to take on a more aggressive approach when it comes to value-based contracts and securing more reliable payments from health plans (e.g., Allina, BCBS of Minnesota announced a six-year value-based contract in August of 2020).
As hospitals are beginning to invest more in HaH programs, we are also seeing elevated demand from patients for receiving healthcare services in the comfort and safety of their homes in a post-COVID-19 world. While we have seen the rapid adoption of telehealth by providers and patients, telehealth is undoubtedly not the be-all and end-all solution to comprehensive care. Invariably, there are true urgent or emergent cases that would require a clinician to provide an in-person examination of patients.
House call companies (e.g., DispatchHealth, Remedy and Heal) that equip mobile care teams with equipment needed to perform high-acuity medical care will see an increase in demand from patients. Health plans and risk-bearing entities (e.g., self-insured employers) will look to accelerate rolling out of house calls to prevent unnecessary ER utilization, which could often lead to in-patient admissions. Many of these new house call companies are also integrating telemedicine services to shorten turnaround time and improve the patient experience.
Furthermore, COVID-19 will have a lasting impact on some of the most chronically ill patients' willingness to receive in-person care. Anecdotally, we have heard many primary care physicians, including ones from advanced primary care groups, highlight that some Medicare Advantage (MA) or Medicaid patients refused office-based visits even as states opened up. Home-based care delivery or home-based primary care will become even more important going forward for MA health plans and risk-bearing providers to close care gaps.
In 2013, Cigna acquired Alegis Care, a Chicago-based house call company, to provide chronic care management for severely ill, homebound Medicare and Medicaid patients. Humana recently made a $100 million investment in Heal, and highlighted the investment and partnership as part of their efforts to build a broader set of offerings across the spectrum of home-based care. Similarly, Landmark Health has provided home-based primary care, house call, and telemedicine services since 2013.
COVID-19 will accelerate home-based care delivery and drive integration of various home-based care delivery services across the acuity continuum.
With the shift to virtual and home care comes a greater understanding of the patient, allowing physicians to better recognize and address the social and demographic factors affecting a patient’s health.
9. There will be greater emphasis on social and demographic determinants of health and how they affect a person’s health status.
The crisis has demonstrated how health disparities and risk-levels for a disease are impacted by income, geography, race and other factors. Experts have been pointing out the importance of acknowledging and addressing social determinants like food or housing insecurity as part of a patient’s care plan for years, but social spending in the U.S. is still low. Now, with entire cities needing to take steps like finding housing for homeless populations, awareness of social determinants of health (SDoH) is rising.
We have seen organizations rapidly ramp up their efforts in providing holistic care to patients and helping risk-bearing providers integrate SDoH screening, coordination and tracking as part of their workflows. Companies like UniteUs, Healthify, NowPow, AuntBertha and others have seen an elevated demand from payers and providers.
Integrated delivery networks have long been champions of SDoH. (See: Intermountain pours $12M into social determinants of health efforts in 2018, Geisinger’s Fresh Food Farmacy and Kaiser Permanente launched initiatives that will improve health outcomes by creating stable housing for vulnerable populations.) Health plans are also ramping up on their SDoH efforts. (See: Centene makes investments to combat hunger, improve connectivity and provide key health and educational products to those in need during COVID-19.) We continue to be hopeful that this elevated awareness will be durable post-COVID-19.
10. Novel care-delivery players will emerge and provide population-specific care for historically underserved populations.
The COVID-19 pandemic has increased public awareness of the inequality that exists in the U.S. healthcare system and the differences in healthcare access and outcomes across population groups. A study of telemedicine cardiology care at the University of Pennsylvania found that patients who completed video visits with their providers "were slightly older, more likely to be male, less likely to be Black, and had a higher median household income than patients who completed telephone-only visits."
For marginalized groups like racial and ethnic minorities, studies show mistrust of providers may be amplified in virtual settings due to limited communication and providers being less mindful of implicit bias. For other groups, like transgender people, especially those in rural areas, virtual care may be the solution to raising the quality of and access to gender-affirming care.
While today's brick-and-mortar healthcare system has often underinvested in care-delivery solutions for historically overlooked communities, we see digital health companies leading the way to creating population-specific solutions for underserved groups (e.g., Medicaid, women, BIPOC, LGBTQ and rural communities).
Maternal health innovators (e.g., Quilted Health and Babyscripts) are working to provide much-needed services to women who have inadequate prenatal care access. On the BIPOC side, companies like Cityblock Health are bringing interdisciplinary teams – including primary care providers, behavioral health specialists, pharmacists, nurse care managers and social workers – to communities where they are needed most. Other early-stage innovators, such as Juno Medical, are looking to build next-generation primary care providers in neighborhoods overlooked by One Medical and other commercially focused providers.
Ethnically focused next-generation primary care and multi-specialty care providers (e.g., Asian-focused and Latino-focused) and Independent Physician Associations (IPAs) partnering with next-generation health plans with ethnically-focused care programs (e.g., Bright Health and Clever Care) will emerge in years to come as many ethnically-focused care-delivery entities have delivered superior quality and outcomes. (See: LEON Medical Centers Health Plans awarded a five-star rating by Medicare for the third time in 2020.)
Another historically overlooked community with population- and sub-population-specific health needs is the LGBTQ community. Over the past few years, we have seen advancements led by digital health companies. Companies such as Plume Health are expanding access to gender-affirming hormone therapy.
As healthcare delivery is becoming more population-specific and personalized, we predict that there will be a proliferation of population-specific in-person and/or virtual care innovators focusing on the needs of historically underserved communities.