Dive Brief:

• Telehealth use continued ticking up at the end of 2021 amid a surge in COVID-19 cases fueled by the omicron variant, according to new data from Fair Health.
• Telehealth claims measured as a percentage of all medical claims grew more than 11% from November to December, the nonprofit found. Telehealth increased from 4.4% of all medical claim lines in November to 4.9% in December, with the increase evident in every U.S. census region. The largest hike, of more than 18%, was seen in the South.
• Telehealth was increasingly being used to diagnose and treat COVID-19. The disease in November was in the top five telehealth diagnoses nationally and in the Midwest and Northeast. In December it remained in the top overall list, and joined the top five diagnoses in the South and West as well. 

Dive Insight:

The advent of the pandemic in early 2020 drove an unprecedented surge in telehealth use as patients turned to virtual care amid business lockdowns, medical service restrictions and fears of in-office viral transmission. Since then, telehealth use has fluctuated over the pandemic, rising and falling as COVID-19 cases do even as large numbers of patients and physicians report satisfaction with digitally delivered care.

That variability has stoked investor concerns in a COVID-19-spurred digital health bubble that could cause consumer demand for telehealth services to plummet once the virus becomes fully endemic.

According to Fair Health, that isn't yet the case. Telehealth reached a record-low percentage of medical claims in October, but the rise of the highly infectious omicron variant in the winter months appears to have spurred another multiple-month upswing in virtual care.

Nationally from November to December, COVID-19 rose from the fifth most-frequent telehealth diagnosis to the third. In the Northeast — the epicenter of December's coronavirus surge — it rose from fifth to second place.

Mental health diagnoses remained the number one diagnosis overall and in all U.S. regions in December. However, its percentage share of telehealth claims fell. That drop was particularly acute in the South, which was the only region to see mental health diagnoses fall to fewer than 50% of all telehealth claim lines.

Experts say mental health is a particular growth area for virtual care, as the pandemic has seriously exacerbated conditions like depression and anxiety while accelerating the creation and use of telemental options. According to CB Insights, global funding for mental health tech startups reached a record $5.5 billion in 2021, up almost 140% from the year prior.

Meanwhile, acute respiratory diseases and infections rose everywhere in percentage share of telehealth claim lines. Hypertension joined the top five telehealth diagnoses in the South and joint and soft tissue issues joined in the Northeast.

Market watchers are waiting to see where demand for telehealth stabilizes once the brunt of COVID-19 is behind the U.S. Projections vary, though the majority agree virtual care use will persist at higher levels than before the pandemic, and future access and use depends on a slew of factors, including how many pandemic-era regulatory flexibilities Washington allows once the COVID-19 public health emergency expires.

That's currently slated to run out in April, though it's likely to be extended for another 90 days. In the meantime, legislators are debating what shape future telehealth regulations should take, though telehealth proponents are optimistic due to broad bipartisan support for greater access on the Hill.