December 09, 2015

Teladoc’s CEO Talks What Telehealth Means for the Future of Healthcare

By Erica Garvin, HIT Consultant

The full article can also be found at HIT Consultant.

What if access to quality healthcare services was just a click, tap, or phone call away? That was the premise that telehealth services were founded on. But beyond the appeal and consumer convenience, telehealth stands to create efficiencies for healthcare systems that are desperately in need of it.

Telehealth isn’t just about taking healthcare to the future—it’s about creating a better future for the patients and providers than can benefit from its use, especially in the wake of the Affordable Care act in the US.

At least that’s what Teladoc’s CEO Jason Gorevic believes. After all, his Dallas, TX-based telehealth service provider reached its millionth visit this year, proving that patients are ready to approach health matters virtually. But will telehealth services really deliver on the promise of transforming healthcare service delivery and access? We asked Gorevic for insight:


As the US health care system continues to serve the greater population in the face of its financial and structural challenges, HIT and technology have come into the fold quite relevantly. Yet, there was early skepticism that services like the ones Telehealth provide and it called into question if healthcare services could be delivered effectively via phone, video, and teleconferencing. However, with more than 1 million telehealth visits under Teladoc’s belt, clearly the mindset is changing. Thus, what do you believe has been the key driver in this shifting mindset? Is it due to a world adopting commercial technologies, or has healthcare reform has paved this path of innovation for companies like Teladoc?

There are several macro trends that have spurred the growth of telehealth. The aging population, increase in population and increased coverage resulting from the Affordable Care Act have all put significant pressure on the health care delivery system. When you combine this with the proliferation of broadband, mobile and video technologies, you get a perfect environment for telehealth to flourish. The adoption of mobile technology, in particular, has played a large role in the surge for on-demand services, including telehealth as a safe, high-quality form of health care delivery. With the advent of on-demand entertainment, one-hour delivery and ridesharing apps, consumers have become accustomed to using mobile apps that make their lives easier. Gaining new or better access to quality health care using today’s technology isn’t an exception.

Consumers’ understanding of the clear benefits of telehealth is growing rapidly. They understand and want increased access to quality health care from wherever they are and whenever they need it. They see the value in talking with a doctor within minutes for a nominal fee ($0 – $40) compared to $1,957 for an ER trip and $145 for a PCP visit.

Telehealth simply makes sense when treating common medical issues.


Teladoc has been able to maintain a 92 percent medical resolution rate and a 95 percent patient satisfaction rate for its non-emergency medical visits. Do you think that technology satisfies a need in terms of convenience and one-on-one care that the in-person model no longer provides adequately? Why or why not?

Fact is it can be hard to see or talk to a doctor when you really need one. Telehealth is creating access to care like never before, and technology is enabling us to do it. Whether you’re in need of a family practitioner or a specialist within dermatology or even behavioral health, telehealth improves patient care by expanding access to quality and affordable care.

Telehealth also allows patients with minor medical conditions to seek care before an issue becomes more complex. In a study performed by the RAND Corporation, they found that 21 percent of people who used Teladoc hadn’t interacted with the health care system in the previous year – they were disenfranchised, and Teladoc provided an entry point into the health care system. This tells us that telehealth empowers people to get the care they need on their own terms. They don’t have to worry about leaving work, missing deadlines or spending time away from their kids – they can get help they need, whenever and however they want. Teladoc, unlike other telehealth providers, offers patients the ability to choose how to connect with a physician using different means of technology, such as mobile app, video, online or phone call.


Do you think we will see a shift in patient perception where visits via technology will be preferential? Everyone seems more tied to their personal devices and online interactions to their personal ones…

As consumers become more educated about telehealth and its benefits – cost, access and quality care – we’re confident the adoption rate will continue to grow as will the ways in which people connect with physicians for care. And our members are passionate advocates. Teladoc has a net promoter score in the mid-70s. That’s comparable to Apple, and unheard of in the health care industry.

Telehealth and Teladoc are disruptors to the way health care is delivered. Take for instance the banking industry. A decade ago, brick-and-mortar banking centers were the primary place to conduct financial transactions. Now, these centers allow you to use apps to deposit money or upload photos and conduct transactions.

For perspective, Teladoc completed its 1 millionth telehealth visit – an industry first – this year, and by year’s end, we’ll conduct more than 550,000 consults. It took us the previous decade to do as many. By using smart, scalable technology, telehealth can continue to make a positive impact on improving patient care.


Are patients leading this movement here, or are you seeing a larger desire to provide services this way from providers?

Teladoc currently has more than 4,000 clients, including 160 Fortune 1000 companies, 20 health plans and over 50 hospitals, who are seeing great success in implementing telehealth programs.

We are seeing an increase in employers, health plans and health systems looking for ways to provide quality care while managing costs, particularly as the Affordable Care Act continues to give more people access to health care with a shortage of primary care physicians. This combination results in increased wait times and costly ER and urgent care visits for non-emergency care. Telehealth is a solution to these challenges and continues to gain favorability among patients, providers, employers, legislators and regulators alike.

Two years ago, I would have said that the providers are interested, but aren’t yet taking action. Today, we see hospital systems embracing telehealth, as they look to take risk, manage the health of populations and move care to the most appropriate setting.


It took Teladoc a decade to reach that 500,000 visit mark. What were the lessons you learned along the way to reach that milestone? What were some of the roadblocks technical or otherwise that made that process as long as it did? What did Teladoc get right? Where did it ever go wrong, if at all?

Our first challenge was to educate the market on the need for telehealth as a critical part of the health care delivery system. This took a tremendous amount of market development. Once we convinced customers to adopt telehealth, we had to focus on consumer engagement, and develop capabilities that would drive adoption by the consumer. Early in our company’s history, we offered our communications and consumer engagement tools as optional services. Today, those are essential parts of our offering, and we won’t unbundle them from the rest of the product.

As our consumer engagement strategies began to yield results, we had to tackle challenges that came with scale. In 2013, we launched our third generation technology platform, which was designed to deliver scalability, flexibility and security. Over the course of that year, we migrated our entire customer base to that platform, which has enabled us to manage the explosive growth that we’ve seen over the last few years.


In that same vein, it then took only a year to reach your millionth visit? What accounted for such an accelerated adoption?

For 11 consecutive quarters, our telehealth visits have outpaced the growth of our membership. This means more people are adopting and using Teladoc at a higher frequency. It’s a great sign of the health of our business. It means we’re engaging more members to use the service. We have great data on who uses our services and why, which enables us to segment and target our communications to the right audiences to drive utilization and better care for those in need.

The Affordable Care Act is also an accelerator for adoption. With more people able to access health care for the first time, telehealth addresses the resulting U.S. PCP shortage and increasing costs from unnecessary ER or urgent care visits.


As both need and popularity for telehealth services grows, how will Teladoc stand out from all the competitors that are bound to crop up? I understand there have been some issues already in this arena, especially where patents were concerned. Still, how will Teladoc remain at the forefront of this movement in the market?

Teladoc’s decades of experience, scalability of our platform, breadth of products and services, physician network and commitment to providing the highest-quality care to our members keep us at the forefront of the industry.

Teladoc is the first telehealth provider in the industry and remains the largest, most experienced and most technologically advanced by far. In 2015, we will conduct more than 550,000 telehealth visits, twice the amount of the rest of the industry combined, and more visualized consults than any other provider. This calculates to one telehealth consult taking place every minute of every day this year.

We are providing greater access to quality care for our members and real, tangible ROI for our clients. We’ve developed more than 100 proprietary telehealth guidelines, maintain rigorous quality assurance programs and oversight, and are the only telehealth provider to receive the National Committee for Quality Assurance (NCQA) certification two years running.

Our more than 2,650 board-certified physicians and mental health providers are focused on delivering and maintaining the highest quality care, regardless of how long it takes, which is why we don’t add fees based on the length of a visit for our more than 12.6 million members.

And after performing more than 1 million telehealth visits over the past 13 years – an industry milestone – we know we’re just at the tip of the iceberg.


Right now, telehealth services are predominately used for non-emergency medical needs. Could this change? Won’t it have to in order to actually reduce costs and create efficiencies since non-medical emergency visits are not all that costly in comparison to the cost of emergency visits and hospital stays?

According to the American College of Emergency Physicians, 85 percent of Americans who visited the ER did so because they could not wait to see their regular medical provider, and more than 50 percent of those visits were for non-emergency issues. ER visits are costly regardless of what medical issue is treated. In fact, the average ER visit costs $1,957. With Teladoc, the average savings per visit is between $700-1,100. Telehealth provides a more efficient way to treat those non-emergency medical issues and skip the pricey ER trip. We don’t see that changing.

We have recently launched telehealth programs focused on behavioral health, dermatology, sexual health and tobacco cessation programs, and in the future, we expect to develop programs around remote monitoring for post-operative care, or chronic diseases like diabetes.


What about use of such technology within hospital systems such as with elderly populations for proper Population Health Management? Is that where this type of service delivery model is headed? And what about patient buy-in? How much with what they prefer shift and shape the future of such services?

We are seeing a significant increase in adoption of the Teladoc platform by physicians and hospital systems for use with their own patient populations. While the providers are clearly interested in providing this access mechanism for their populations, they do not have the technology, operations, or patient engagement tools to effectively do so on their own. We are happy to partner with them to deliver these capabilities and enable them to practice high quality medicine on terms that are preferential to their patients.


Telehealth services in general seem to be touted as what’s going to help providers deliver more effective care to their own patients. Is this true do you think? Won’t this bring its own form of competition to services like Teladoc? What happens then? Won’t patients want to communicate this way with their own providers rather than one from a service such as Teladoc?

Because of the significant increase in adoption of the Teladoc platform by physicians and hospital systems for use with their own patient populations, as mentioned previously, we agree telehealth helps providers deliver more effective, convenient care on the patients’ terms.


There is a lot of talk about the need for transparency in costs when it comes to medical care. As patients pay more out of pocket how is that going to affect the telehealth market? Can you provide transparency that regular medical providers can’t compete with?

Yes, we always tell the member up front what the cost is going to be. We don’t run a clock, like a taxi meter, but rather provide a fixed cost that is always disclosed up front. Because we know up front the cost of the service, Teladoc takes payment from the member at the time of service, which avoids the annoying back and forth that frequently occurs in traditional care settings.


Clearly, we live in a modern era of technology. And a visit will always be required for more serious concerns. But without being able to put their hands on the patient, isn’t it possible providers will/ may miss critical health concerns for patients? How do we avoid letting those major health concerns slip through the cracks with this type of service delivery?

Providing quality care is our number one priority and we take this seriously. The more than 2,650 board-certified physicians and mental health providers in Teladoc’s network are held to demanding standards. For example, they are required to review every patient’s electronic health record and prior clinical notes before every visit with our more than 12.6 million members.

Our physicians rely on over 100 proprietary, evidence-based guidelines that are specific to the remote delivery of care. This year, we will review over 60,000 charts to ensure compliance with these guidelines. In addition, we provide regular feedback to our physicians on patient satisfaction, quality of documentation, prescribing rates and other quality metrics.

Whether a visit takes place in an ER or urgent care, in-person or via telehealth, the physician is held to the same clinical standard of care. Our physicians’ only incentive is to provide great care. Therefore, if a patient needs to be seen in person, the Teladoc physician always has the option of referring the patient to an ER, urgent care or physician’s office.


With everything we’ve explored in mind, what do you think the telehealth market will look like in, say, 10 years? Are we headed for an explosion in these types of services and branching out of sorts? We have talked to several medical providers who are using such technologies in trauma centers, or for teleconferencing purposes. Are we just scratching the surface here? What’s beyond what we’ve already seen innovation wise or integration wise?

We see a massive market opportunity for telehealth. What we’re addressing today is a market size of about $17 billion. We’ve just barely scratched the surface. There are 400 million health care visits addressable by telehealth, but the entire industry is expected to do less than 1 million in 2015. We’re in the early stages and the opportunity for growth is vast.

In the future, you will see us continue to expand the scope of the clinical services we offer, incorporate new technologies, such as remote monitoring devices and biometric data, and expand our partnerships with providers.


With your perspective of the future, what’s next for Teladoc specifically? What’s the focus as it looks to the future with the challenges of reform still ahead for healthcare?

We’re excited to continue expanding our efforts in specific practice areas, including behavioral health, dermatology, tobacco cessation and sexual health. You’ll see us expand into chronic care management, integration with biometric devices and work collaboratively with providers.


What’s your advice to those startups getting into the telehealth game, not necessarily to compete directly with companies like yours, but to make an impression in the market space? In that same vein, what should providers and patients on the fence of telehealth services keep in mind?

First, any startup has to address a real need. It must be ready to pivot if the business model isn’t working or the environment shows it’s unsustainable. Not every business model stays the same. You have to be flexible. Listen to the market and tweak your product or service to address a specific need.

The single biggest piece of advice regarding telehealth is that a successful program must have three distinct capabilities: 1) a highly scalable technology-enabled operation, 2) a robust clinical-quality program and 3) a sophisticated patient-engagement strategy. If any of these three fail, the telehealth initiative can’t succeed.


Any closing thoughts for our readers?

The advantage of Teladoc as the leading telehealth provider lies in utilization. Telehealth can only deliver efficiency to the system – savings in expense and productivity – if people actually use it. That’s why we have placed such a strong emphasis on utilization with our customers, even baking it into our business model with the Per Member Per Month structure, which we use to boost utilization. Because of that, our utilization rates are multiples higher than other telehealth providers as measured by patient visits, and therefore the Return on Investment for employers who offer our product is much greater.

Our goal is nothing short of revolutionizing access to health care. That means helping people resolve their issues quickly, easily and affordably-when, where and however they want. Teladoc is pioneering better health solutions that address the core issues of access, cost and quality that deliver ROI to our clients.