The Future of Telehealth and First Dollar Coverage

Before the COVID-19 pandemic, telehealth was often treated as a secondary form of care, especially for services that extended beyond basic consultations and preventative services. It wasn’t until the public health emergency that telehealth rose to fame as the premier solution to the lack of in-person care. However, what began as a stop-gap measure was soon recognized as a long-term care optimization solution—especially in high-cost, high-utilization specialties like musculoskeletal (MSK) care.

Where we started: an emergency solution for a new landscape of care

At the onset of the pandemic, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was signed into law to safeguard Americans against unexpected financial and health-related risks. First-dollar coverage for telehealth services was a core component of this act, eliminating cost-sharing responsibilities for employees and plan members who utilized these services (AMA, 2020). This program was especially impactful for individuals with high-deductible health plans (HDHPs), who would normally have to cover regular out-of-pocket expenses for non-preventative care—costs that quickly ballooned over time and diminished access for many who lost their main source of income during the pandemic.

Where we landed: better outcomes at a lower cost

With cost-barriers out of sight and nearly 30% of U.S. employees enrolled in HDHPs, the benefits of no-cost telehealth visits have become even more advantageous (KFF, 2023). While HDHPs already cover preventative services, members gained access to full coverage for a variety of office visits in a telemedicine setting, driving measurable improvements in access, outcomes, and costs. According to one large health plan survey comparing virtual and in-person care, telehealth visits were able to (Cigna, 2022):

• Reduce cost per visit, costing $93 less for a non-urgent visit and $120 less for a specialist visit

• Cut down on inappropriate testing, saving $18 per episode of care

• Lower unnecessary healthcare consumption, with 19 percent fewer unnecessary visits to the emergency room or urgent care

• Improve access and outcomes, with two-thirds of patients without a primary care physician discovering a health condition during their initial virtual visit

In light of the significant cost-savings and improvements in member outcomes, the first-dollar telehealth coverage program was extended beyond its original termination date, per the Consolidated Appropriations Act (CAA) of 2023 (Welle, 2022). From January 1, 2023, to December 31, 2024, employers could choose to continue waiving telehealth deductibles and copays for HDHP members, without jeopardizing their Health Savings Account (HSA) eligibility, in the hopes of building a healthier member population (Welle, 2022).

Where we’re headed: the uncertain future of first-dollar coverage

Despite the benefits, this program may soon come to a close at the end of the year. There are currently several bills floating around Congress for various types of expansion to telehealth coverage, but nothing has been acted upon. The front-running legislation on continuing first-dollar coverage relates to Medicare payments for telehealth services. While this potential legislation would continue to knock down access barriers for a population that disproportionately faces mobility and transportation challenges—in addition to a greater need for care for muscle and joint pain—this coverage would exclude another population in critical need of affordable care: HDHP members.

Without access to free telehealth visits, members of HDHPs, as well as the employers and payers who sponsor those plans, face poorer outcomes due to:

• Members not seeking care when they truly need it. HDHP members tend to be young and healthy individuals who don’t expect to consume healthcare throughout their plan. Instead, they choose to keep and invest the money that would have otherwise contributed to their premiums. As a result, when an HDHP member gets injured or develops a chronic condition, they may delay or forgo care to avoid paying thousands of dollars in deductibles. This creates a compounding effect that, by the time the member decides to seek medical help, treatment is often extensive and costly to fully address the issue.  

• Overutilization to hit high deductibles. When an HDHP member must seek care for debilitating conditions like MSK pain, more often than not they go all in and consume high volumes of care upfront—knowing that, once their deductible is met, the rest of their care will be “free” to them. We see this in the 20 percent surge in end-of-year elective surgeries, when deductibles are met and members can get their procedures “for free,” despite the low value and high risks (Piersa, 2021). This means members may opt for elective orthopedic surgeries, even if the procedure is unnecessary and exposes them to major risks, forcing their employers or plans to cover the rest of the astronomical costs.  

Despite the well-documented reduction in healthcare costs and consumption, HDHPs may discourage individuals from seeking the care that they truly need until it’s too late (Agarwal, 2017). First-dollar coverage for telehealth plays a monumental role in delivering high-quality, convenient care that doesn’t leave HDHP members anxious about how they will cover the cost. Likewise, first-dollar telehealth coverage also safeguards employer plan sponsors in the long run, as members are more likely to seek early intervention and avoid the costs of chronic, long-term care.

For employers and payers, the continuation of waived telehealth deductibles from the CAA has been a game changer in meeting the needs of their plan members. If Congress decides to discontinue this extension beyond 2024, employers will face major tax implications if they attempt to offer first-dollar coverage, thereby forcing the return to traditional HDHP terms that put the financial burden entirely on the employee. While the permanent adoption of first-dollar telehealth coverage would be a win-win for employers, payers, and employees, we may soon face the reality of regular cost-sharing and high deductibles for telemedicine visits.  

Despite legislative uncertainty, Vori Health has implemented a variety of strategies to help current and future clients provide the best possible MSK care that delivers value for all stakeholders, leveraging a multidisciplinary, physician-led care team specializing in non-operative and evidence-based care. With up to a four times return on investment and a less than three percent surgical referral rate, Vori Health is dedicated to driving out unnecessary costs and inappropriate care from the MSK space with virtual-first, highly personalized, and clinically proven care programs—meaning lower costs and better outcomes for all of your employees and plan members.

Ready to learn more about how you can optimize MSK care for your employees and members?

‍Schedule a demo to learn how Vori's telehealth program can lower costs and improve results for individuals with chronic MSK conditions.

REFERENCES

• AMA, 2020: CARES Act: AMA COVID-19 pandemic telehealth fact sheet. AMA. https://www.ama-assn.org/delivering-care/public-health/cares-act-ama-covid-19-pandemic-telehealth-fact-sheet  

• Cigna, 2022: Does Virtual Care Save Money? Cigna. https://newsroom.cigna.com/convenient-cost-effective-and-high-quality-virtual-care-is-here-to-stay  

• Welle, 2022: Welle NJ, Ferrante TB, Demsien HR, Werwie CJ. Another Extension of Telehealth Relief for HDHP/HSA Plans. Foley & Lardner. https://www.foley.com/insights/publications/2022/12/another-extension-telehealth-relief-hdhp-hsa-plans/  

• Agarwal, 2017: Agarwal R, Mazurenko O, Menachemi N. High-Deductible Health Plans Reduce Health Care Cost And Utilization, Including Use Of Needed Preventive Services. Health Aff (Millwood). 2017;36(10):1762-1768.

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