McKinsey estimates that $ 250 billion of all health care spending could be digitized

• Up to $ 250 billion in healthcare spending can be digitized, according to a new report from consulting firm McKinsey & Company. This represents approximately 20% of all estimated Medicare, Medicaid, and outpatient, office, and home care expenses in 2020.

• Analysis based on McKinsey claims suggests that 20% of ER visits could be avoided with virtual emergency care, 24% of virtual doctor visits and outpatient volumes, and 9% “virtual”. Up to 35% of home health services could be virtualized and 2% of the total volume of outpatients could be moved home through a designed drug delivery service.

• Some analysts predict that the use of telemedicine will decline in the second half of 2020 when the coronavirus ends. However, McKinsey researchers estimate that these dynamics will persist for at least the next 12 to 18 months until a vaccine is widely used so that telemedicine has enough time to normalize in the healthcare system.

Before the pandemic, the total annual sales of US telemedicine companies were estimated at $ 3 billion, with most providers focusing on the on-demand emergency care segment. However, as awareness and acceptance continue to grow, providers have the opportunity to expand their services beyond virtual emergency care.

This $ 3 billion market could grow to $ 250 billion if trends continue.

“The window for action is now. This current crisis underscores the need for telemedicine and opens the door for the improvement of the health system, “wrote Oleg Bestsennyy, partner at McKinsey, and Greg Gilbert, Alex. Gilbert, partner at McKinsey. Harris and Jennifer Rost. “The cornerstone of success will be laid in the coming months during the COVID-19 crisis.”

The pandemic has led to exponential growth in virtual care use, from 11% of Americans in 2019 to 46% now, according to data from McKinsey. And 76% of consumers say they are interested in using telemedicine in the future, which is a good sign of long-term adoption, although there is still a gap between hypothetical interest and actual use.

Health systems, independent general practitioners, hospitals, and many others report that the number of telemedicine visits has increased 50 to 175 times from pre-pandemic levels. Telemedicine providers and providers have made efforts to expand their IT infrastructure and virtual care offerings in response.

Virtual assistance enables physicians to recoup income from personal visits while protecting patients from the potential spread of disease. According to a survey conducted by McKinsey physicians in May, telemedicine currently rates telemedicine as cheaper than before COVID-19, with 64% feeling more comfortable.

Since the beginning of March, the Trump administration has removed several barriers to using virtual assistants. It has temporarily approved more than 80 new Medicare telemedicine services, increasing payments for audio-only visits and allowing Medicare Advantage plans to conduct risk assessments digitally, including flexibility.

The changes allowed an unprecedented number of older people to use telemedicine in the early days of the pandemic.

CMS Administrator Seema Verma said her agency is investigating which of these flexibilities could remain after the national emergency is over.

The permanent removal of barriers to telemedicine is a popular step: in addition to pressure from much of the private sector, there are also supporters in Congress and the executive branch.

The Federal Trade Commission said Friday in a letter to CMS that it states that Medicare’s telemedicine coverage is permanent.