Telehealth Is Less Promising Than It First Seemed

A key issue facing Congress in its postelection, “lame duck” session is whether to extend regulatory flexibilities expiring at year end that make telehealth services more accessible to Americans. A new study I authored suggests it should proceed with caution.

Telehealth — the use of remote audio or video technologies to provide health-care services — has been promoted as a way to increase patients’ access to care particularly in rural and underserved areas, increase convenience to patients, improve quality, and decrease costs relative to traditional in-person care. But there is little evidence to support these claims.

Prior to the Covid-19 pandemic, less than 1 percent of medical services were delivered via telehealth. Various barriers such as limited public and private insurance coverage for telehealth services, inadequate broadband coverage in some areas, and restrictions on the interstate practice of medicine impeded telehealth adoption.

Early in the pandemic, federal and state governments introduced telehealth flexibilities, and insurers relaxed telehealth rules so that patients could access care while in-person services were restricted or unavailable. Some flexibilities ended when the public-health emergency expired in May 2023. Others for mental-health telehealth services coverage under Medicare were made permanent. Most of the rest were extended through the end of 2024. Congress is currently considering several proposals to permanently or temporarily extend these expiring flexibilities.

My paper examined evidence about telehealth usage, quality, and cost from before, during, and after the pandemic. Telehealth usage rose rapidly early in the pandemic, partially offsetting a steep drop in in-person visits. But in-person visits quickly rebounded, and telehealth utilization dropped off. Both types of visits have returned to nearly pre-pandemic levels in most fields of medicine.

The major exception is for mental and behavioral health including substance-abuse care where telehealth usage jumped early in the pandemic and continued to increase. Overall mental-health claims remain well above pre-pandemic levels, an increase that is entirely attributable to telehealth. As a result, total telehealth utilization remains above pre-pandemic levels.

Contrary to expectations that telehealth would be particularly valuable in rural areas, it was more heavily utilized in urban areas and rarely for interstate services. Again, mental-health and substance-abuse services may be an exception, with higher usage in rural than urban areas.

Patient surveys reveal general satisfaction with telehealth. But some physicians worry that they cannot conduct adequate physical examinations via telehealth. The evidence indicates that telehealth is most useful and accurate in areas of medicine where physical examination is less important, such as mental and behavioral health.

Telehealth is likely no worse than in-person quality in most other medical areas, particularly when used for follow-up visits of established patients rather than for initial consultations. Several studies, however, reported troubling overprescription of antibiotics for inappropriate indications at telehealth visits, a practice which could exacerbate the growing problem of antibiotic resistance. And many physicians believed that in-person visits offered a better personal connection and improved physician–patient relationship compared with telehealth.

Despite claims that telehealth would cut costs, increased telehealth availability and utilization likely increased health-care spending. Several pre-pandemic studies suggested that telehealth could increase costs by supplementing rather than replacing in-person services. The limited available evidence suggests that the same thing happened during and after the pandemic as in-person visits generally returned to pre-pandemic levels and as telehealth visits, particularly for mental health, remained elevated over pre-pandemic levels.

The number of consistent telehealth patient users appeared to be small and mostly concentrated in mental-health services. They used large amounts of telehealth services, generating more claims per person as time went on.

My study concluded that — outside of mental and behavioral health (including substance-use disorders) — telehealth did not continue to be heavily utilized, even during a period of unprecedented regulatory permissiveness. This suggests that patients and providers do not find telehealth as attractive relative to in-person care as many policy-makers had predicted. We still don’t know enough about the cost-effectiveness of telehealth or how the quality of telehealth compares to standard in-person visits in many areas of medicine.

Until these uncertainties are resolved, Congress, along with state and local governments, should not authorize a permanent expansion of telehealth in government programs that could trigger increased and possibly wasteful spending and decreased quality of care. Congress should be cautious because private insurers and state Medicaid programs often follow Medicare’s lead on coverage policies.

The Government Accountability Office (GAO) recommended in September 2022 that the Centers for Medicare & Medicaid Services (CMS) comprehensively assess the quality of telehealth services and ensure that they are medically necessary. Unfortunately, CMS refused to do this assessment. CMS, under new Trump administration leadership, should follow GAO’s sensible recommendation and determine if the increase in telehealth utilization, which has been particularly large and persistent for mental-health services, represents costly overutilization or is meeting previously unmet needs while providing health-enhancing services at a reasonable cost.

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