Telemedicine Linked to Health Care Cost Savings, Improved Quality

Research has found links between greater telemedicine utilization and improvements in health care access and quality, particularly among chronically ill populations.

A recent Health Affairs study has dug into the quality and cost impacts of telehealth utilization during the pandemic. Researchers examined more than 5.5 million beneficiaries with continuous enrollment in traditional Medicare who received care across 576 health systems between 2019 and 2021–2022.

The research found that telehealth services were associated with increased outpatient costs and decreased emergency care spending.


The findings come at a time of debate around the future outlook of telehealth regulations. Temporary waivers implemented during the COVID-19 public health emergency will expire Dec. 31, 2024. Regulators are currently weighing future telehealth policies, including making some of the flexibilities permanent.

“Given the small improvements in access and quality (in particular for chronic disease medications), combined with modest increases in spending along with patients’ and clinicians’ preferences, we believe that it will be difficult to justify a return to restricting telemedicine payment in Medicare,” researchers wrote in the study.

The research examined a variety of health systems, including academic medical centers, private equity-backed companies, nonprofits and public entities. A large contingent (86.7%) of the patients with higher telemedicine rates were 65 and older with chronic conditions and high frailty, including those with heart failure, depression and diabetes, among others.


Patients with higher telemedicine utilization saw a 2.7% decrease in emergency department (ED) visits compared to others. These patients also saw a 1.6% increase in costs associated with outpatient visits, care continuity and medication adherence. Both in-person and telehealth visits were measured in the outpatient costs, while continuity of care examined primary care and health system visits.

“Clinicians in the health systems in the highest quartile of telemedicine use may have had limited capacity to provide additional visits,” researchers wrote. “Alternatively, there may have been limited demand from patients for telemedicine as a result of technological barriers or beliefs that telemedicine visits are lower in quality than in-person visits.”

The findings signal that telemedicine may facilitate improved quality of care and deter higher-acuity care utilization, the researchers indicated.

“A major impediment to long-term coverage of telemedicine has been concerns that it will increase spending or hurt quality,” researchers stated. “The convenience of telemedicine might translate into more visits, which could improve chronic illness management and help those with difficulty getting to clinician appointments.”

Barriers exist impeding the ability to learn more about telehealth impacts. Case in point, the research found geographic disparities in telehealth utilization.

More than half of the patients with higher telemedicine use were heavily concentrated in Northeast regions, and the majority (92.7%) were located in urban areas, the research found.

Continuing to examine telehealth utilization impacts will be an important part of learning more about the impacts on health care spending and quality outcomes across the continuum, the researchers stated.

“The effects of telemedicine on quality and spending could change as technology improves, health systems optimize telemedicine services or patient demand grows,” they wrote.

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