Impact of Telehealth and Process Virtualization on Healthcare Utilization
Authors: Ayabakan, Sezgin; Bardhan, Indranil R.; Zheng, Zhiqiang (Eric)
Journal: Information Systems Research (2024)
<jats:p> Telehealth has emerged as a tool to improve patient access by virtualizing healthcare services, particularly during the COVID-19 pandemic. However, concerns have been raised that telehealth may actually increase healthcare spending by leading to new types of utilization. Our research provides empirical evidence that this concern is unfounded based on a state-wide study of patient visit-level data of telehealth use in 58 hospitals in Maryland from 2012 to 2021. On average, telehealth use can reduce future outpatient visits by 13.6% within 30 days after a telehealth visit, leading to a cost reduction of $239. The benefits of telehealth are most apparent for diseases with high potential for process virtualization, such as mental health, skin disorders, metabolic, and musculoskeletal diseases. Although telehealth has a substitution effect on future healthcare utilization, this effect is not observed among rural patients who use telehealth as a gateway to utilize more primary care and specialist services. Our findings suggest that policymakers should promote the use of telehealth in a value-based healthcare environment by providing monetary incentives to expand telehealth use…