Analysis of claims and consumer data reveals two years into the pandemic more than 245M Americans have not used telehealth

Females between ages 21-40 consistently propping up waning telehealth demand

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The post-pandemic market of telehealth consumers will be concentrated to a small segment of the population. Considering COVID’s “forced adoption” among singular utilizers, the most conservative estimates of the future telehealth market is less than 10M consumers. (Graphic: Business Wire)

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TRILLIANT HEALTH’S NATIONAL STUDY FINDS 46% OF AMERICANS WHO USED TELEHEALTH DURING THE PANDEMIC WERE SINGLE UTILIZERS, SUGGESTING FORCED ADOPTION OF TECHNOLOGY

Analysis of claims and consumer data reveals two years into the pandemic more than 245M Americans have not used telehealth

Females between ages 21-40 consistently propping up waning telehealth demand

Trilliant Health released its 2022 Telehealth Trends Report today, revealing that the adoption of telehealth by physicians and patients is declining even as the number of new suppliers is increasing. The report presents a longitudinal analysis of the ways in which Americans utilized telehealth from March 1, 2020 through November 30, 2021 using a variety of national datasets. The study examines telehealth according to the laws of economics, concluding that when given a choice, the vast majority of patients prefer in-person care; and the total addressable market for telehealth is less than 1% of the health economy.

Among the study’s key findings was that only 25.6% of Americans utilized a telehealth modality during the pandemic under the broadest definition of telehealth (i.e., audio-video, audio-only, chat, etc.). Under the more traditional (i.e., audio-video and audio-only) definition of telehealth, only 23.7% of Americans used telehealth during the pandemic. In contrast, almost 75% of Americans have not used telehealth during the pandemic.

For telehealth visits reimbursed by a third-party payer, 46% of patients used telehealth only once. In fact, nearly 80% of the telehealth patients during the pandemic had no more than four visits, and only 14% of telehealth patients completed seven or more visits.

The study also found that telehealth utilization during the pandemic can be classified into two categories:

• Patients – both male and female – across all age cohorts who completed just one telehealth visit for COVID-19-related reasons primarily to access testing; and
• Female patients ages 21-40 from more affluent areas who consistently use telehealth services for behavioral health.

Not only did patient utilization of telehealth peak in April of 2020, provider utilization declined almost immediately, with the number of providers submitting telehealth claims declining by 5.2% from April 2020 to May 2020. Providers delivering telehealth services before the onset of COVID-19 (early adopters) conducted approximately 20% of their visits (mean) via telehealth. In April 2020, telehealth accounted for 59% of their visit portfolios, but by November 2021, it dropped to 36% on average.

The 2022 Telehealth Trends Report is designed to provide a more precise understanding of the market segments and populations that use telehealth. This report expands upon Trilliant Health’s findings in its inaugural Trends Shaping the Health Economy Annual Report, released in June 2021, which noted that the 1,015% increase in telehealth visits during the initial peak of the COVID-19 pandemic had already begun to taper by December 2020.

The 2022 Telehealth Trends Report suggests that the explosive growth in telehealth in 2020 resulted in large part from forced adoption as opposed to the industry narrative of an event that catalyzed latent demand. Many conclusions in the 2022 Telehealth Trends Report challenge notions from other research that suggest patient interest in telehealth broadly is increasing across the U.S. population and call into question the notion that telehealth is an effective, or preferred, substitute for primary care.

“Our research indicates that patient preferences and many of the prevailing narratives on the market outlook for telehealth are seemingly incongruent, reinforcing caution for organizations that are planning their virtual care strategies solely based on industry hype. The pandemic absolutely accelerated adoption, but growth is largely attributable to the law of small numbers,” said Sanjula Jain, Ph.D., Trilliant Health’s chief research officer and senior vice president of market strategy. “The reality is that telehealth, which was intended to be a tool to expand access to care, has only managed to do so within a very small subset of the population. More importantly, despite ‘forced adoption’ during the pandemic, telehealth is a commodity good that was not used by the individuals who need it most. The data suggests that in the absence of alternative choices, telehealth appears to be a substitute good. However, when given a choice, the majority of patients prefer in-person care with the exception of behavioral health. Ultimately, traditional providers are not motivated to adopt telehealth and are not equipped to compete with retail suppliers.”

Females in their 20s and 30s are consistently the highest telehealth utilizers.

While telehealth has the potential to increase healthcare access for more people, especially underserved populations, Trilliant Health’s analysis suggests a small subset of females are driving the majority of telehealth visit volume.

Females constitute 60% of all telehealth patients, and females were consistently the highest utilizers among all utilization groups: single utilizers (1 visit), low utilizers (2-4 visits), average telehealth utilizers (5-6 visits), high utilizers (7-24 visits) and super utilizers (25+ visits). As the unique number of visits per user increases within this segment, the most consistent “super utilizers” are females who are “digital natives” between the ages of 21-40 who generate 40% of telehealth visits. In addition, Trilliant Health’s analysis finds that high telehealth utilizers tend to reside in wealthier counties like New York (NY), Denver (CO), Hennepin (MN), and Middlesex (MA).

Behavioral health visits account for the greatest share of telehealth.

The plurality of telehealth utilization has always been for treatment of behavioral health conditions, which have increased during the pandemic. Although demand for virtual behavioral health has fallen slightly from pandemic highs, America’s mental health crisis makes behavioral health the greatest proportion of telehealth usage.

Overall, behavioral health telehealth visits made up 47.5% of all telehealth visits during April 2019 to November 2021. Additionally:

• Among patients leveraging telehealth for behavioral health care, treatment for severe stress and anxiety disorders were the most common diagnoses.
• In a declining telehealth market, behavioral health accounts for a greater share of a smaller number of visits over time. From March 2020 to November 2021, behavioral health utilization of telehealth as a proportion of the total has increased by 55% (from 38.23% to 59.3%).

Hybrid care holds some ground but increasing competition puts pressure on players.

Trilliant Health also analyzed the ratio of patients who received care either in-person only, telehealth only or both (hybrid). Patients engaged in “hybrid” care represented 20% of the population in March through December of 2020, but that has decreased by 25%, with only 15% of patients engaged in “hybrid” care in 2021. Similarly, the percentage of Americans who are telehealth-only patients has declined by nearly 40% to represent just 5.4% of patients in 2021.

As demand for telehealth services has declined over the past two years, the number of virtual-care and hybrid-care providers have increased significantly, resulting in increasing competition for a declining subset of the population.

Additional key insights from the 2022 Telehealth Trends Report include:

• Telehealth modality usage not affected by pandemic: Despite more permissive reimbursement, less restrictive regulatory frameworks (practice across state lines, etc.), and a vastly expanded definitions of “telehealth” (e.g., synchronous audio-only, chat), single-modality or mixed-modality usage by each category remained largely unchanged from 2019 to 2020 to 2021.
• Payment parity is not directly correlated with increased telehealth adoption: Commercial insurers pay 2-3x more for an in-person visit than a comparable telehealth visit. Payment parity is more relevant for Behavioral Health given the lack of related ancillary services.
• Patient financial responsibility for telehealth continues to increase: While the retail price for telehealth, a good whose marginal cost is effectively zero, averages between $59-75, the patient’s portion increased by 110% from 2020 to 2021.

Trilliant Health’s 2022 Telehealth Trends Report is part of the company’s ongoing Trends Shaping the Health Economy Report series, which are designed to provide research and data-driven guidance to all healthcare stakeholders, including health systems, insurers, life science companies, digital health companies, investors, policymakers and other healthcare research and academic organizations. The report’s independent findings often run counter to commonly held assumptions about the health economy, especially in the post-pandemic era.

For access to the complete 2022 Telehealth Trends Report, click here.

About Trilliant Health

Trilliant Health provides predictive analytics to the healthcare industry, creating unique evidence-based strategies for the health economy. Trilliant's comprehensive understanding of local market dynamics provides probability-based solutions to maximize returns from growth strategies. For more information, please visit trillianthealth.com.

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