This year hasn’t been a great one for virtual care companies. Optum shuttered its virtual care unit in April, Walmart closed its virtual care offering (as well as its entire healthcare unit) in May, and two of the country’s largest telehealth providers — Teladoc Health and Amwell — have both laid off a significant number of workers over the past couple years.
But this doesn’t mean telehealth is dead, said Eve Cunningham, chief of virtual care and digital health at Providence, during a Tuesday interview at the Reuters Digital Health conference in San Diego.
“There was a wave of companies that were basically telehealth-only standalones — or primary care plus telehealth standalones — that weren’t connected into an integrated care delivery system. That just doesn’t work,” Cunningham declared.
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Delivering virtual primary care and nothing else is a very hard model to make profitable, she noted.
It’s not impossible, though. For instance, a startup may be able to make this model profitable if it is a concierge practice that only takes cash-pay or commercial patients, Cunningham pointed out.
“But if you’re really trying to take care of the entire community — Medicare, Medicaid and all of the community’s diverse patient population — you have to look at the entire ecosystem of the integrated care delivery system in order to make it financially pencil out,” she explained. “I think some of these companies thought they could fragment off a piece of care and make it profitable, and they just got ahead of themselves without really understanding the whole economics of healthcare delivery.”
When virtual care is connected to the greater healthcare system as well as a patient’s existing care journey, it can still be a convenient and effective modality for treating patients, Cunningham noted. Health systems know this, and this is why they are still making telehealth a part of their care delivery models even though many retail disruptors are abandoning it, she said.
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Providence providers conduct virtual visits with more than 1.1 million patients per year, Cunningham added.
“Telehealth is not dead, but the way in which companies were trying to deliver it was problematic,” she remarked.
Oftentimes, it makes sense to utilize telehealth visits for certain episodes within a patient’s care journey and rely on in-person visits for other parts, Cunningham said.
For example, say a patient has pelvic pain. They may visit their OB/GYN’s office for an initial visit and ultrasound, and then they might have a virtual visit a few days later to discuss the results with their doctor. If the doctor and patient decide that surgery is the next step, the patient will obviously have that procedure done in-person — but their postoperative visit could very well be conducted virtually.
“Telehealth needs to be weaved into the episode of care,” Cunningham explained. “There seems to be a lack of understanding of how care delivery happens and where the opportunities are to inject the virtual encounters into that care delivery.”
Photo: elenabs, Getty Images
Editor’s note: A previous version of this story stated that both Teladoc Health and Amwell had conducted “major” round of layoffs in 2024, which isn’t entirely accurate.
