This document discusses virtual care opportunities and challenges for payer organizations. Virtual care includes telehealth, digital therapeutics, mHealth, and care navigation using audio/video, apps and mobile devices. The COVID-19 pandemic drove growth in virtual care utilization. Payers can leverage virtual care to lower costs, improve quality scores and member experience, and expand access in rural areas. However, payers face challenges regarding regulations, technology, health plans and member concerns. The document recommends strategies for payers including collaborating with providers, defining a clear roadmap, developing new products, focusing on primary care, and investing in digital tools.

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Virtual Care: Key Challenges &
Opportunities for Payer Organizations
January 2021
Authors: Nikita Agrawal; Healthcare BA
CitiusTech Thought
Leadership

2. 2
Agenda
▪ Virtual Care: Introduction
▪ Virtual Care: Industry Drivers
▪ Virtual Care: Opportunity for Payers
▪ Virtual Care: Key Challenges
▪ Virtual Care: Mitigation Plan for Payer Organizations

3. 3
Introduction: What is Virtual Care?
Virtual Care can be described as virtual visits or remote interactions of patients with healthcare professionals or
providers usually established through audio, video conferencing, SMS, email, mobile applications or social media
platforms.
▪ Telehealth
• Telemedicine: Live patient-doctor interaction. Recorded data is exchanged between patient and physician
in the form of pathology reports, medical records, etc.
• Remote Patient Monitoring: Obtain patient medical / health records outside of traditional clinical setting
▪ Digital Therapeutic
• Evidence-based software or new category apps that manage, prevent and treat a medical condition
• Popular applications: Obesity, diabetes and psychological conditions
▪ mHealth
• Medical and public health practice supported by mobile devices such as mobile phones, wearable devices,
personal digital assistants (PDAs), etc.
• E.g.; Fitness trackers, video consultation via mobile apps, chatbots, etc.
▪ Care Navigation
• eTriage: Software designed to automatically check-in and prioritize patients upon arrival to an emergency
department
• Triage Categories: Priority 1 (Immediate), Priority 2 (Delayed), Priority 3 (Minimal)

4. 4
Virtual Care: Industry Drivers
Government Regulations
▪ In early 2020, administration permitted Medicare
to cover telehealth and waived off rules related
to geographical limitations
▪ Relaxed HIPAA regulations: An action taken by
Health and Human Services (HHS) to not impose
any penalties related to regulations
▪ 80 new services included by CMS in Medicare
Advantage plans
Payer
▪ Reimbursement: Same rate as in-person visits for
Medicare and Medicaid
▪ Premium: During COVID-19, members were
provided virtual care at no cost. Starting October
2020, some insurers have rolled back telehealth
coverage and members now have to provide out-
of-pocket expense
Highlights
1.7 Mn
Virtual Visits Per Week
~9 Mn
First Time Telehealth Users
$250 Bn
Virtual Care Industry Revenue
Humana Inc. collaborated with
Doctor On Demand and launched
OnHand, a virtual care model. As
virtual visits are free, the plan has a
lower premium. Patients can seek
in-network primary care doctors
without any copay.

5. 5
Virtual Care: Opportunity for Payers
Advantage Virtual Care
$80
Cost of providing a telehealth service.
It costs about $150 & $1,735 for in-
person & ED visit respectively
75%
In-person visits could be virtual
6-8%
Emergency visits can be avoided with
virtual care
Improves Quality
Scores
RPM enables physicians to regularly
monitor patient vitals and deliver
better care.
Improves Member
Experience
Allows minimum wait time along with
personalized medical consultation at
patient’s place of residence.
Expand Reach in
Rural Areas
Improves patient-to-primary care
ratio and quick check-ins for medical
adherence.
Higher Utilization &
Reduced Costs
Telehealth consultations take 20%
less time, allowing physician to treat
more patients.
In 2012, US Department of Veterans Affairs provided virtual care services to 150,000 beneficiaries,
resulting in 25% reduction in bed days & 19% reduction in hospital admissions

6. 6
Virtual Care: Key Challenges
1. Regulations
▪ Ambiguity regarding federal and state regulations
▪ Coverage laws vary from state to state
2. Technology
▪ Unpredictable broadband connectivity in rural areas may discourage rural population to opt for
virtual care
▪ Providing coverage at different sites and types of care
3. Health Plan & Continuity
▪ Determination of appropriate reimbursement rate (payment parity)
▪ Members could perceive virtual visits as a one-time event and not a long-term engagement
with their physicians
4. Member Concerns
▪ Rapid expansion raises member data privacy and security concern

7. 7
Virtual Care: Mitigation Plan for Payer Organizations
Payer
Adoption
Strategy
Provider
collaboration
Clear
Roadmap
New
Products
Focus on
Primary Care
Go
Digital
Collaborate with providers to understand
reimbursement rates based on cost
effectiveness and patient outcomes
Build a roadmap to define how and
when members use virtual care in
order to serve large population
Develop new product designs to satisfy
consumer changing needs, preferences
and demand for low-cost plans
Focus on building the primary
care model and revaluate role in
care delivery
Invest in digital care
management tools / vendors

8. 8
References
▪ https://www.mckinsey.com/industries/healthcare-systems-and-services/our-insights/telehealth-
a-quarter-trillion-dollar-post-covid-19-reality
▪ https://www.medmehealth.com/blog/what-is-virtual-care
▪ https://www.iqvia.com/locations/united-states/solutions/healthcare-solutions
▪ https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)30818-7/fulltext

9. About CitiusTech
4,000+
Healthcare IT professionals worldwide
1,500+
Healthcare software engineering
400+
FHIR / HL7 certified professionals
25%+
CAGR over last 5 years
110+
Healthcare customers
▪ Healthcare technology companies
▪ Hospitals, IDNs & medical groups
▪ Payers and health plans
▪ ACO, MCO, HIE, HIX, NHIN and RHIO
▪ Pharma & Life Sciences companies
9
Thank You
Authors:
Nikita Agrawal
Healthcare BA
thoughtleaders@citiustech.com