The telehealth boom that was propelled by the COVID-19 pandemic has consolidated at levels lower than at the peak of the pandemic in April 2020, but significantly higher than levels seen before the pandemic. Consumer demand remains strong and will grow over time. McKinsey found that two of five surveyed consumers reported that they will continue to use telehealth going forward. As telehealth goes mainstream, the market represents both opportunities and challenges for traditional video telehealth platform vendors, such as Teladoc, Amwell, and MDLIVE, as well as healthcare providers. Both now face an unprecedented challenge from non-traditional players for control of the patient in terms of how and when they access medical care.

Fueled by unprecedented levels of venture capital investment, new entrants have entered the telehealth market. The competition is not just from competing video telehealth platforms. Some companies are competing for the same service revenue, but with alternative virtual care service models. An example is remote patient monitoring that allows for the transfer of patient data to a remote provider for monitoring and support in the care management of chronic conditions as appropriate.

A 2021 survey of 7,980 US adults conducted by Rock Health and Stanford Center for Digital Health identified the new paradigms disrupting conventional telehealth market parameters as follows:

• Telehealth as a tool within a comprehensive suite of virtual care offerings to engage patients and providers in managing care and realizing outcomes.
• Virtual-first care as part of an omnichannel experience that supplements and complements, rather than replaces in-person care across settings.
• Telehealth for more targeted user segments (e.g., women) and specialized clinical needs (e.g., reproductive health), or both (e.g., adolescent behavioral health).

Although satisfaction among survey respondents is high, retail giants, such as Walmart, CVS, and Amazon, have entered the market, which could see them capture market opportunities that still exist to create value through personalized virtual care experiences and need fulfillment:

• Walmart’s purchase of multi-specialty telehealth provider MeMD will allow it to provide virtual care services, including urgent care, behavioral health, and primary care to consumers nationwide. Walmart previously partnered with telehealth providers (i.e., Doctor on Demand, 98point6, and Ro) to provide virtual care to its 1.6 million employees in the US. The shift to virtual care is part of Walmart’s larger consumer health strategy, which includes in-store Walmart Health services offering transparent pricing, licensed healthcare staff, and a variety of primary, dental, optometry, and behavioral health care services, and integration with the retail aspect of consumer health and wellness products.
• After Amazon’s initial foray into telehealth to first serve the needs of its employees, it has expanded its virtual care services as a virtual health service benefit to employers through Amazon Care. In addition to providing in-person primary care visits and prescription delivery at patients’ homes or offices, Amazon Care offers virtual visits via chat or video conference to expand access to primary, preventative, and urgent care 7 days a week, 365 days a year. Available to employees and employers nationwide, Amazon is initially targeting denser metropolitan statistical areas to ensure that individuals using its Amazon Care service have immediate access to in-person care if needed within 60 minutes of their GPS location.
• Traditional healthcare providers are also under threat from traditional pharmacy retailers, such as CVS Health and Walgreens, which have also been expanding their virtual care services. CVS Health announced a “digital-first, technology-forward” strategy that builds on the decision to pivot the store footprint to focus on advanced primary care centers, enhanced HealthHUB locations, and traditional pharmacy stores. The company’s strategy to deliver omnichannel health services and offerings to meet the needs of 35 million online members when and where they want them will offer significant opportunities to enhance CX, improve efficiencies, and lower costs.