Does telehealth save money? The jury’s still out.

Insurers’ degree of willingness to take a bet that telehealth will reduce spending reflects their philosophy, she said: “Do they want to try something or do they want to wait til it’s proven?”

Hopeful that telemedicine will help transform medicine with cheaper, more accessible and timely care, CMS has gradually expanded Medicare coverage for telehealth services, while its advisory commission, MedPAC, has pushed for a “measured approach” to paying for it. CBO estimates for expanding telehealth coverage have been similarly cautious.

The uncertainty hasn’t stopped some companies from taking the plunge. Amazon’s new clinic service Amazon Care, for instance, will offer employees access to nurses and doctors via video chat, in addition to in-person visits, CNBC reports.

There is plenty of data showing that telemedicine will lead costs to increase — or decrease, depending on the study.

Being able to instantly dial doctors through an app could nudge clinic-averse patients to check in more frequently, leading to more utilization. But since dialing a clinician is so easy, patients might decide to check in before a condition escalates, staving off expensive treatment later.

“There have been studies in both directions,” Pantely said. “There are ones that say it doesn’t increase that much, and mostly diverts people from emergency room visits. I’ve seen [other] studies that say it increases utilization a lot.”

One 2017 assessment of a California public employee benefit program contracting with Teladoc found that beneficiaries were consulting doctors about acute respiratory illnesses more than they would have had the service not been offered, thereby increasing spending. The cost per visit was lower for telehealth than in-person check-ups, however, according to the study.

Harvard’s Ateev Mehrotra, one of its authors, advised against generalizing the findings. Anecdotal evidence suggests telehealth could increase or decrease spending depending on the medical specialty. Mehrotra said he suspected that patients reluctant to meet therapists in person may do so only if given a telehealth option, for instance. He called that phenomenon “induced demand.”

On the other hand, telestroke — in which emergency departments beam in stroke specialists — might reduce spending later in a patient’s life. “If [an emergency department] has telestroke capacity, maybe they’re going to be less likely to transfer the patient [elsewhere]. Or maybe the patient is going to be treated more early in the illness,” Mehrotra said.

A 2017 CBO analysis of the CHRONIC Care Act, which was signed into law as part of the 2018 budget agreement and provides for expanded Medicare coverage of telestroke, comes to a similar conclusion. Considering a pattern of “initial increase in spending and a reduction over time for each cohort of patients each year,” the agency estimated that the measure would ultimately reduce Medicare spending.

Commercial insurers have the most leeway to experiment. Though CMS has some authority to adjust payments for virtual services, there are still legislative limits on where and when Medicare can pay for telehealth. Medicare Advantage’s private plans are more flexible; in 2020, more than half of all plans will offer additional telehealth benefits to about 13.7 million enrollees, according to CMS.

If they wait for a definitive answer about costs before deciding to cover these services, payers could keep patients waiting for years.

There isn’t even comprehensive data about the number of patients who use telehealth. Early numbers come from a patchwork of payers and providers. Research nonprofit FAIR Health’s analysis of private insurers finds that claims for telehealth services jumped more than 1,200 percent from 2012 to 2017. A CMS report found that about a quarter of a percent of Medicare fee-for-service patients used the technology between 2014 and 2016.

“The reason [the calculation] gets really complicated is … the counterfactual,” Mehrotra said — it’s difficult to ascertain what patients really would have done if telehealth services weren’t available to them. “We don’t really have much data on how much telemedicine is used as a whole.”