Many still see telehealth as a lesser substitute for in-person care, but when used properly, it not only improves health outcomes but also cuts costs and expands access—especially for the majority of adults globally who own a smartphone, including those in underserved areas.
Despite these advantages, the use of telemedicine in the U.S. has dropped significantly since its peak during the early days of the Covid-19 pandemic. Similar trends have been observed worldwide, although some regions—like the EU and Saudi Arabia—are pushing ahead with initiatives to expand virtual care through shared digital records and mobile platforms.
Still, regulatory, financial, and cultural hurdles remain in many countries. But if the goal is to raise healthcare quality, improve access, and reduce costs, expanding virtual care should be a priority.
This article highlights lessons from two pioneers in telemedicine: Kaiser Permanente and Intermountain Healthcare. For over a decade, these systems have successfully used telehealth to enhance preventive care, manage chronic conditions, and reduce expenses for over 13 million patients. Data suggests that if their approach were adopted nationally, it could improve care quality and access by 20%, while cutting costs by up to 20%.
Opportunity 1: Reduce Unnecessary ER Visits
Patients often face a tough choice after hours: go to the ER or wait until morning. Emergency rooms are not only costly—often 12 times more than a regular doctor visit—but can also be risky due to fragmented records and lack of follow-up care.
Telehealth offers a better solution. At Kaiser Permanente in the Mid-Atlantic region, members can access 24/7 virtual consultations. Doctors quickly assess whether a case is urgent and direct patients accordingly—resolving the issue virtually about 60% of the time. This avoids unnecessary ER visits, lowers costs, and improves patient safety.
Similarly, Intermountain Healthcare in Utah created a Covid-19 home monitoring program. Patients with mild symptoms received a pulse oximeter and reported daily readings via smartphone. A care team monitored results and escalated care only when needed. Over 14 months, this system helped avoid over 1,800 hospitalizations and freed up nearly 5,000 bed-days.
Scaling these types of programs across the country could prevent countless unnecessary ER visits and hospitalizations—saving billions and potentially thousands of lives.
Opportunity 2: Improve Chronic Disease Management
Chronic illnesses like hypertension, diabetes, and heart disease are the leading causes of death and disability in the U.S., and they significantly worsened Covid-19 outcomes. The U.S. spends hundreds of billions annually treating preventable complications from these conditions.
A key challenge is inconsistent care. Traditional models rely on office visits every few months, regardless of a patient’s actual condition. That’s inefficient and inconvenient.
In contrast, systems like Kaiser Permanente use telehealth to monitor chronic conditions more frequently and adjust treatment promptly. For example, KP achieves hypertension control rates above 90%—far better than the national average of 50%. Their success lies in personalized, consistent virtual check-ins rather than more in-person appointments.
For many patients, monthly or even weekly virtual touchpoints are more effective—and more accessible—than waiting months between physical visits.
Virtual Tools Lead to Better Disease Management and Outcomes
Virtual visits can be scheduled more frequently and tend to be less time-consuming for both patients and providers. Patients can track their blood pressure at home using devices that sync directly with their electronic health records. This integration—combining telemedicine with wearables—enables more timely medication adjustments, leading to better control of chronic diseases, fewer complications, and lower overall costs.
Kaiser Permanente’s emphasis on primary care, prevention, and virtual monitoring has delivered measurable results. In California and the Mid-Atlantic region, KP members are 14% less likely to die from stroke and 43% less likely to die from heart disease compared to the general U.S. population.
Better outcomes also drive significant financial savings. Each year, around 805,000 Americans experience a heart attack. As of 2012, the average cost for care post-attack was $21,500—a figure that has likely increased since. If even 40% of these events could be avoided through consistent monitoring and early intervention via telehealth, the U.S. could save at least $6.9 billion annually.
Opportunity 3: Address Health Care Disparities
Telemedicine has proven to be a powerful tool in closing gaps in access to care. During the pandemic, smartphones enabled video consultations for millions of people, including those in medically underserved communities.
In rural areas, where mental health services are often scarce, Intermountain Healthcare offered timely virtual access to both routine and urgent behavioral health care. During peak pandemic periods, 85% of its mental health appointments—including substance use programs—were delivered virtually. Even after in-person care resumed, virtual mental health services remained popular due to their convenience and high patient satisfaction. Patients were also more likely to keep their appointments compared to those scheduled for in-person visits.
Kaiser Permanente used virtual care to address disparities in urban areas. In 2006, it launched a program for pregnant women with substance use disorders at 21 medical centers. These women often struggled to attend in-person group sessions due to transportation challenges or lack of childcare. But with access to a smartphone and just a 3G signal, they could attend sessions remotely. Attendance rates jumped from under 30% to over 80%, significantly lowering the number of neonatal ICU admissions—each of which can cost over $100,000 per baby.
Opportunity 4: Improve Access to Specialty Care
Primary care providers frequently face a frustrating dilemma: they have nearly all the information and expertise needed to manage a case—but lack quick access to a specialist to confirm the diagnosis or treatment plan. Without that last 5% of insight, doctors often have no choice but to refer patients for in-person specialty consultations. This results in delays, increased costs, and often unnecessary specialist visits.
Telehealth offers a more efficient solution. Through “e-consults” or virtual specialist input, primary care doctors can get rapid guidance on whether their approach is appropriate or whether further action is needed. This not only speeds up care and reduces costs, but also allows specialists to focus their time on patients who truly need in-person evaluation.
Integrated systems like Kaiser Permanente and Intermountain have already adopted these models, using telemedicine to streamline referrals, shorten wait times, and ensure patients receive the right care at the right time.
Streamlining Specialist Access Through Telehealth
Long waits for specialist appointments have long plagued the U.S. health system. Even before the pandemic, patients often had to wait weeks to see a dermatologist or other specialist. Kaiser Permanente addressed this delay with real-time telemedicine consultations. While the patient is still in the primary care office, doctors can consult dermatologists virtually, often resolving issues in under 10 minutes. In 70% of such cases involving hard-to-diagnose rashes, patients leave with a confirmed diagnosis and treatment plan—without ever needing a separate appointment.
This virtual model extends across numerous specialties. At Kaiser Permanente, remote consultations resolve patient concerns 40% of the time without requiring a physical visit to a specialist. Patient satisfaction with virtual consultations is also higher—by about 10%—compared to traditional, in-person visits. When in-person treatment is needed, the initial virtual consultation ensures the follow-up is timely and targeted. If even 30% to 40% of all U.S. specialty visits shifted to this model, it could save patients time, reduce absenteeism at work, and generate tens of billions in annual savings.
Opportunity 5: Connect Patients to Top Specialists Anywhere
For patients with rare or complicated conditions, finding the right expert can feel impossible. These individuals often suffer through misdiagnoses and long delays as they bounce between generalists. Telemedicine cuts through this struggle by connecting patients with leading specialists, regardless of location.
In Kaiser Permanente’s Northern California region, for example, patients diagnosed with kidney cancer can consult virtually with one of the country’s foremost experts—even though he practices in a remote area nearly 200 miles away. Through video calls, the doctor explains the condition, reviews imaging and treatment plans, and walks patients through surgical procedures using visuals. The rapport and clarity built through these virtual consultations are so strong that most patients opt to have this physician perform their surgery, even if they must travel far for the procedure.
Similarly, Intermountain’s virtual neurology program helps patients with complex and costly neurological issues—like migraines or chronic back pain—receive specialized treatment remotely. Its "Neuro Fast Access Clinical Team" provides affordable care and helps ensure in-person visits are reserved for procedures like nerve injections.
By eliminating geographic and logistical barriers, telemedicine improves the chances of accurate diagnosis and timely treatment—especially critical in rare or complex cases.
The Broader Impact: Improving Quality, Cost, and Access
Health care providers constantly try to balance three competing priorities: access, cost, and quality. Traditionally, improving one comes at the expense of another. But the widespread use of telemedicine during the Covid-19 pandemic demonstrated that it’s possible to improve all three simultaneously.
Expanding virtual care can benefit patients across the board—from those needing care during nights or weekends, to individuals with chronic conditions, mental health concerns, or rare diseases. With more widespread adoption, the nation could save hundreds of billions of dollars and tens of thousands of lives every year.
How to Accelerate Telemedicine Adoption
Two structural shifts are crucial to embedding telemedicine into mainstream health care:
1. Integration
High-performing health organizations—like Kaiser Permanente, Intermountain Healthcare, Mayo Clinic, and Geisinger—are built around integrated, multispecialty care teams connected by advanced information systems. As more physicians move away from private practice (less than 50% remained in private practice as of 2021), they are increasingly joining large organizations. This shift enables more seamless care coordination, shared health records, and the efficient use of virtual tools—capabilities that isolated practices typically lack.
2. Capitation
The fee-for-service payment model incentivizes volume over value—more procedures mean more revenue, regardless of necessity. This creates resistance to innovations like telehealth that reduce unnecessary visits and hospitalizations.
Capitation—where providers are paid a fixed annual rate per patient—rewards value instead. Physicians are motivated to keep patients healthy and avoid expensive interventions. It’s no coincidence that organizations like Intermountain (with over 90% of patients in capitated plans) and Kaiser Permanente (95% in such plans) are leaders in virtual care. These financial models align with telemedicine’s strengths and promote its adoption.
A Vision for the Future: Tele-Driven Health Systems
The future of U.S. health care could be built around a tele-driven model—one that is prepaid, integrated, and technology-enabled. In this system, primary and specialty physicians collaborate through virtual platforms, share electronic health records, and focus on prevention, quality, and cost efficiency. Every part of the system is aligned around the goal of delivering better outcomes for defined patient populations.
Employers—who provide insurance to nearly half of all Americans—are ideally positioned to push for this transformation. They suffer the consequences of inefficiencies and stand to benefit most from improved employee health and lower costs.
What Employers and Providers Can Do Next
To bring this future closer, health care stakeholders should take these key actions:
- Develop partnerships between employers and integrated provider networks to create health plans centered on virtual-first care.
- Incentivize adoption of telemedicine by embedding it into insurance designs, care pathways, and performance evaluations.
- Educate patients and clinicians on the safety, effectiveness, and convenience of virtual care.
- Invest in infrastructure that enables telehealth access for underserved populations, including broadband and mobile device access.
- Advocate for policy reforms that support capitation and value-based care over fee-for-service models.
Uniting Businesses for Tele-Driven Healthcare Reform
To address escalating healthcare costs, employers may need to come together—either nationally or locally—to leverage their collective influence and drive real reform. Large companies like Walmart, Costco, and Microsoft are already collaborating through the Purchaser Business Group on Health (PBGH), which focuses on reducing healthcare spending. These organizations are well-positioned to adopt and scale virtual-first care models that align with their cost and quality priorities. In contrast, smaller regional partnerships, such as New York’s NorthStar Network, show how local employers can also make meaningful changes by joining forces.
Research from integrated health systems like Kaiser Permanente and Intermountain Healthcare suggests that a robust virtual care infrastructure typically requires a population of 30,000 to 50,000 covered lives. While few employers can reach this scale alone, coalitions of 15 to 20 companies can reach the critical mass necessary to support and sustain a telemedicine-focused system.
Healthcare Inflation Requires Immediate Action
Healthcare costs have been rising at more than 5% annually—even before the pandemic. If left unchecked, this trend will increasingly strain business finances and affect employee coverage. The article emphasizes that delayed action will only worsen these pressures, urging businesses to act proactively rather than reactively.
Leadership Will Drive Transformation
While the pandemic proved that video-based care can be implemented quickly, building a tele-driven healthcare system demands structural and financial reform, which depends on effective leadership.
To lead such a transformation, companies creating a new healthcare entity would need two key leaders:
- A financial expert from the insurance or payer side to design payment structures and manage costs.
- A clinical leader to guide care quality, coordinate digital systems, and shape provider incentives.
Together, this leadership team would handle contracting with hospitals, build digital platforms, and manage financial risk using tools like reinsurance.
Redesigning Payment and Clinical Models
A successful telehealth system must replace traditional fee-for-service payments—which reward volume—with salaried, value-based compensation tied to outcomes. Given that many doctors now work within larger health systems, this shift is more viable than it once was.
To support continuous virtual care, such systems would require:
- Around 20 full-time primary care clinicians for 24/7 virtual availability.
- A comprehensive network of on-demand specialists to support frontline providers.
Over time, this model would reshape the healthcare workforce, placing more emphasis on primary care, which could also influence how medical students select specialties.
Improving Efficiency and Health Outcomes
Telemedicine allows primary care teams to manage more cases independently, while still accessing specialists when needed. At Kaiser Permanente, for example, up to 40% of issues presented to primary care physicians are resolved through virtual specialist consultations, without needing in-person referrals.
This model improves diagnostic accuracy, reduces unnecessary ER visits and hospitalizations, and enhances both patient outcomes and cost efficiency.
Learning from Leaders—and Raising Expectations
Even health systems at the forefront—such as KP and Intermountain—still face structural limitations, including:
- Dependence on physical infrastructure
- Continued use of fee-for-service billing for certain services
However, sustained pressure from the business community, which ultimately pays for most healthcare, could push these systems and others to accelerate the adoption of virtual-first care at scale.
The Call to Action: Businesses Must Lead
If U.S. businesses want to control healthcare costs, support employee well-being, and maintain competitiveness, they must champion a smarter, technology-enabled approach to care delivery. Waiting for policymakers or health systems to lead the change could prove far more costly in the long run—both financially and in terms of workforce health.
By uniting to create or support integrated, virtual-first care models, employers can play a pivotal role in building a more efficient, effective, and equitable health system for the future.
