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Telehealth in the pursuit of value-based care

Insight Article - March 12, 2022

Population Health

Patient Care Technology

Value-Based Operations

Xiao (Lilac) Li PhD student
Jae Man Park
Editor’s note: This article was the winning manuscript from the Trends and Innovations in Population Health student research topic contest. Submissions were open to MGMA student members enrolled in CAHME-accredited programs of study. Learn more about MGMA for CAHME students.

In response to the COVID-19 pandemic, the healthcare industry must embrace unprecedented levels of innovation, redesign its delivery and reimbursement system, and build a new business ecosystem. From the pandemic has come the growth of telehealth and the pursuit of value-based care across the United States.

Digital momentum keeps growing

One of the silver linings of the pandemic is the expansion of telehealth services. Telehealth has been effective in alleviating the pressure on healthcare systems by minimizing the influx of patients and mitigating the risk of infectious exposure to COVID-19 for patients and providers. In comparison to the first quarter of 2019, there was a 50% increase in telehealth visits in the same period in 2020 in the United States.1

The pandemic is also accelerating the healthcare industry’s transition from fee-for-service (FFS) to value-based care, in which providers are rewarded for the quality of care they deliver. Since value-based care is one of the leading strategies for containing healthcare costs, many delivery models have been invented and implemented during the pandemic.

Oak Street Health, for example, developed its COVID-19-specific care model based on the philosophy of the flexibility of care delivery and financing of value-based care, which provides daily telephone nursing calls, food delivery, and COVID-19 testing based on a registry of all suspected and confirmed infections.2 Moreover, Oak Street Health emphasizes supportive care by assessing a patient’s physical, mental and emotional health for adverse social determinants of health (SDoH).

Another example is Community Care Cooperative, a MassHealth accountable care organization (ACO) of federally qualified health centers (FQHCs). It established a telehealth platform for providing flexible access to primary and behavioral health services, which has expanded to include population health programs, chronic care management and other services.3

Policy boosts

To harmoniously facilitate implementing value-based care and adopting telehealth, the Centers for Medicare & Medicaid Services (CMS) embraced five new CPT® codes to allow providers to get paid for remote healthcare services, including remote patient monitoring (RPM) and e-consults.4 Specifically, CMS has expanded its reimbursement coverage for remote care services, such as service setup, patient education, and time spent on telecommunication for providers during the pandemic. The 2021 Medicare Physician Fee Schedule (PFS) final rule5 enshrined 60 new services on the List of Telehealth Services, which will continue to be covered after the pandemic ends.

Telehealth drives transition to value-based care

Unlike traditional models of healthcare, telehealth is a broad term that encompasses email and video consultations, activity-tracking wristbands and mobile apps. It is evident that telehealth is becoming more affordable as payers and providers adopt a value-based care model.6,7 In particular, travel time/cost, wait time and care costs are reduced. Thus, value-based care metrics are enhanced, and patients often feel they benefit more from the service.

At the same time, the growth of telehealth is fueled by providing incentives for care delivery in the lowest-cost settings, identifying and interacting with high-risk individuals before disease onset, managing care teams with more efficient workflows, and taking advantage of digital remote technologies. Given its current popularity and progress, even the white paper recently released by Polsinelli8 states that telehealth has the potential to become the preferred healthcare delivery method to match the trends of value-based care. Furthermore, according to Care Innovations®,9 telehealth in its many forms, including RPM, can offer providers an easy and cost-effective path to achieve value-based care, thereby improving health outcomes and patient satisfaction across a broader population of patients.

Potential pathways

Improve general primary care through telehealth expansion

There are two major potential pathways to telehealth expansion. The first is expansion in primary care, which is an essential component of healthcare.10 Through telehealth expansion, healthcare services that are not readily available to patients in a certain geographical area can become accessible. In addition, telehealth can enable doctors and patients to collaborate in a more seamless manner, especially for patients with chronic conditions; hence, primary care will become more efficient and reduce ER visits. Value-based contracts that reimburse RPM and other telehealth services will make providers less dependent upon transactional FFS arrangements. Furthermore, telehealth has been shown to be a sustainable strategy for lowering healthcare costs.11

Improve general surgery patient care through telehealth utilization

Besides general primary care, telehealth can also be expanded through improving general surgery patient care. During the pandemic, telehealth technologies have become an important modality of healthcare delivery for pre- and post-operative surgical consultations, surgical teleconferences and educational sessions in surgical care. Research has suggested that the implementation of telehealth in the care of general surgery patients would be beneficial.12 For example, the quality of healthcare and patient satisfaction at the New England Veterans Administration Medical Center have been improved significantly as a result of implementing a nurse practitioner-led telehealth visit approach.13 At the same time, more providers are embracing telehealth. For example, Ronald A. Navarro, MD, an orthopedic surgeon with Southern California Permanente Medical Group, has used telerehabilitation technology to remotely assist patients with physical therapy exercises following their hip and knee replacements, helping patients become more involved with their care.14

Refining healthcare reimbursement models

To sustain a value-based care approach to telehealth, it is imperative to sustainably reform the healthcare reimbursement models so that remote patient care programs can achieve high-quality outcomes while reducing costs and sustaining reimbursement to providers. To achieve this goal, the dominant strategy should be guided by an alignment map and by stakeholders’ interest and changing pathways.15 It will require a cascading effort involving policymakers, frontline providers and insurance companies.

If value-based care is not implemented correctly, it can result in deviations in the goals of healthcare quality and outcome improvement, such as adverse selection, cream skimming and patient dumping.16 To avoid these potential pitfalls and accelerate the adoption of telehealth and value-based care, we recommend:
  1. Strong accountability at all levels, from patients to payers
  2. Alignment of financial and clinical models among multiple payers, provider types and populations
  3. Increases in value-based care readiness and willingness among managed care organizations and providers
  4. Implementation and maintenance of administrative simplification.17

Challenges and recommendations

Despite the potential benefits of telehealth and value-based care, it is also important to bear in mind there are many challenges ahead. To prepare for these challenges, providers should become familiar with state and federal regulations and restrictions, as well as the temporary mandates and directives that may apply to utilize telehealth smoothly to support the transition to value-based care. Healthcare organizations should also ensure that providers and staff are trained on policies, practices and protocols regarding the use of telehealth services, including appointment scheduling, documentation and billing, referral processes for specialty health services, urgent care and pharmacy prescriptions.

Providers should also recognize that telehealth is not a one-size-fits-all solution for care delivery. For example, some patients may find it difficult to use telehealth. If so, patients should have access to user-friendly platforms that can be used for video and non-video consultations. Also, healthcare organizations should develop proper metrics to measure value improvement (healthcare quality and outcome) of telehealth, and metrics should be stratified by key population groups as needed.

Finally, healthcare organizations should consider how their telehealth programs can be established and reinforced within the current healthcare landscape so that these programs can more effectively contribute to their transition to value-based contracts while ensuring high-quality care delivery.


  1. Koonin L.M., et al. “Trends in the use of telehealth during the emergence of the COVID-19 pandemic — United States, January–March 2020.” Morbidity and Mortality Weekly Report, 69(43), 1595-1599.
  2. Myers G, Price G, Pykosz M. “A Report from the Covid Front Lines of Value-Based Primary Care.” NEJM Catalyst Innovations in Care Delivery, 1(3). May 1, 2020. Available from:
  3. Roiland R, et al. “Value-Based Care in the COVID-19 Era: Enabling Health Care Response and Resilience.” Margolis Center for Healthy Policy, June 2020. Available from:
  4. American Hospital Association (AHA). Fact Sheet: Telehealth. 2019. Available from:
  5. CMS. "CMS-1734-F CLL/TLP." Nov. 27, 2020. Available from:
  6. Ravitz N, Looby S, Jordan C, Kanoff A. “The economics of a telehealth visit: A time-based study at Penn Medicine.” Available from:
  7. Snoswell CL, Taylor ML, Comans TA, Smith AC, Gray LC, Caffery LJ. “Determining if telehealth can reduce health system costs: Scoping review.” Journal of Medical Internet Research, 22(10), e17298.
  8. Henderson J, Squire P, Steward J, Kline M. “Ascension of Telemedicine.” Available from:
  9. Care Innovations®. (n.d.). Report: Telehealth Adoption ‘May Help Drive Transition’ to Value-Based Care. Dec 5, 2021. Available from:
  10. National Academies of Sciences, Engineering, and Medicine. “Implementing High-Quality Primary Care: Rebuilding the Foundation of Health Care.” Washington, D.C.: The National Academies Press. Available from:
  11. Thota R, Gill DM, Brant JL, Yeatman TJ, Haslem DS. “Telehealth is a sustainable population health strategy to lower costs and increase quality of health care in rural Utah.” JCO Oncology Practice, 16(7), e557-e562. 
  12. Wade VA, Karnon J. Elshaug AG, Hiller JE. “A systematic review of economic analyses of telehealth services using real time video communication.” BMC health services research, 10(1), 1-13.
  13. Asiri A, AlBishi S, AlMadani W, ElMetwally A, Househ M. “The use of telemedicine in surgical care: a systematic review.” Acta Informatica Medica, 26(3), 201-206.
  14. Moseley J, Carter-Templeton H, Aying J, and Kristo G. “Telehealth Utilization to Improve the General Surgery Patient Care Experience.” The Journal for Nurse Practitioners, 17(8), 958–962.
  15. Alkon C.  “Using Telehealth to Advance Value-Based Care.” Nov 16, 2016. Available from:
  16. Cutter C, Berlin N, Fendrick M. “Establishing A Value-Based ‘New Normal’ For Telehealth.” Available from:
  17. Bynum J, Lewis V. “Value-based payments and inaccurate risk adjustment — who is harmed?” JAMA Internal Medicine, 178(11), 1507-1508.
  18. Rowan P. Value Based Payment “VBP”. [PowerPoint slides]. Blackboard. The University of Texas Health Science Center at Houston. 2021.

About the Authors

Xiao (Lilac) Li
Xiao (Lilac) Li PhD student
School of Public Health, University of Texas Health Science Center Houston, Texas

Jae Man Park
Jae Man Park
PhD student School of Public Health, University of Texas Health Science Center Houston, Texas


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