Telehealth vs. Urgent Care: Who is the clear winner?

Last week, I spoke at a telehealth conference at Stony Brook University. Here’s my first slide:

Here’s why. Sixteen years in, the industry leader did 1.1 million visits in the past 12 months. To put this in perspective, there are 1.1 billion doctor visits per year in America.

A recent study also showed that, out of 20 million people, 0.51% of them filed a telehealth claim:

But Kaiser Permanente’s CEO famously said in 2016 that “52% of last year’s patient transactions were conducted online, by virtual visits or through the health system’s apps.” He broke those stats down for us:

• 20 million email collaborations

• 17 million online prescription refills

• 4 million scheduled appointments done online

• 37 million tests viewed online

Last Thursday, an article was published in the New England Journal of Medicine, describing all the video visits Kaiser doctors did throughout all of Kaiser for all 12.2 million of their patients over the course of 2015 to 2017. Here are the those stats:

• 210,383 video visits

• 152,809 patients scheduled a video visit (1.25% of 12.2 million patients)

• Only 66% of visits actually connected (scheduling issues, abandoned by patients, tech issues, etc.)

Here’s what the growth of those video visits looked like:

As you can see, they doubled in volume for the first two years and then it appears that demand is flattening, but that remains to be seen.

So, to conclude, the concept of video visits is a real bust. After 16 years of existing and billions of dollars invested in them, even in Integrated Delivery Networks like Kaiser where people don’t even have to pay for them, the demand is found in 0.51% to 1.25% of people.

But what’s been, by far, the most massive healthcare service success story? Urgent care, by far. There are massive increases in utilization:

There are now 7,700 urgent care centers in America. If each does 40 visits a day, that’s ~110M urgent care visits a year, which is 10% of all doctor visits in America.

Imagine a competition between urgent care and telehealth over the last 11 years. During that time, urgent care has grown to be 100x the volume of video visits.

And to put this all in perspective, here are the number of claims per 1,000 for the various acute care venues. Poor telemedicine. It’s really a negligible blip.

So, in summary. People will pay a premium for access as urgent care has proven. But people will also reject gimmicks capable of treating a very tiny sliver of actual real everyday problems (a 10 minute chat between strangers who can never connect again nor confirm suspicions with tests or exams can only treat ~30 simple conditions like pink eye). People will also reject things like PCPs who make you wait for weeks.

So, what can we learn from all of this?

First, telehealth is irrelevant because, by design, it is massively limited in capability and can only solve 30 simple health problems.

Second, the advertised mode of communication (“talk to a doctor by video”) is both a very unnatural human behavior (nobody in our culture talks to strangers via video chat) and talking on the phone or video is a dead and dying behavior in the target market these telehealth services have chosen to serve. What do I mean by that?

Today’s communication is overwhelmingly asynchronous. In fact, I’d argue that the transition from mostly synchronous to asynchronous communication (enabled first by email and then the internet) will be viewed as just as important as the invention of the printing press.

So, the only way to connect with people who are likely to embrace innovation, is to offer them services that:

• Are broad in scope and can actually solve more than 30 simple problems

• Match how they normally behave and use technology to communicate and solve problems on a daily basis

If you do that, here’s what usage looks like (data from our last 7 years of operating). Notice, by year two of Sherpaa access, ~60% of people use Sherpaa as their starting point for care.

That’s because Sherpaa is:

• Primarily asynchronous and matches our culture’s everyday communication behaviors. 95% of our interactions are via secure asynchronous messaging within Sherpaa’s app and only about 5% of the time we jump on the phone).

• Can diagnose and manage ~1,500 everyday primary care health issues (on par with a traditional PCP)

• Based on continuity where you always work with the same doctor every time you use Sherpaa to talk with your own personal physician.