Medicare Telehealth Use Substitutes Rather than Adds to Care, Analysis Finds

A comprehensive analysis by the American Telemedicine Association (ATA) Center of Digital Excellence (CODE) alongside nine major U.S. health systems provides key insights into Medicare telehealth utilization. Covering data from 1.67 million Medicare beneficiaries, the study reveals that virtual care primarily substitutes in-person visits rather than increasing overall healthcare utilization. Despite a significant 31-fold surge in virtual visits, total visits per Medicare beneficiary increased minimally by just 0.25 visits on average, indicating a strong substitution effect. The analysis includes diverse healthcare models ranging from academic medical centers to rural providers, such as Advocate Health, Johns Hopkins Medicine, and UPMC. In the largest subgroup of over 350,000 beneficiaries, virtual visits grew by over 200 times, but total visit counts per patient only rose by 0.01, reinforcing that telehealth supplements rather than adds to existing care demands. This substitutive pattern was consistent across various delivery systems and stable over the 2022-2023 period, highlighting telehealth’s role in maintaining existing patient engagement without driving additional service volume. The operational data utilized in this study differs from traditional claims-based analyses by tracking clinical workflows and substitution patterns in real-time, offering a more accurate representation of telehealth integration in everyday care. Findings from this research also suggest potential benefits for healthcare cost containment and workforce sustainability by optimizing telehealth’s role as a care delivery substitute. Such insights are valuable for federal policymakers navigating the evolving telehealth regulatory landscape. As Elissa Baker, project lead for ATA CODE, notes, these results reflect a complex, fragmented policy environment and highlight opportunities for health systems to leverage telehealth more effectively under streamlined legislative frameworks. This analysis marks a significant step in understanding telehealth’s impact within Medicare, providing critical evidence to guide industry stakeholders on reimbursement strategies, care model innovation, and regulatory compliance. It underscores telehealth’s utility as a strategic tool to maintain access while managing utilization rates in a cost-conscious manner.