Teladoc was pleasantly surprised by the recently proposed rule by the Trump administration to expand telehealth reimbursement for physicians.
While the change isn’t likely to bolster the company’s direct-to-consumer efforts, CEO Jason Gorevic sees it as a boost to Teladoc’s provider business, and a stepping stone on the way to more expansive federal policies.
“In conversations with teams within the administration, it's clear to me that the support is there over the long-term for an expansion of telehealth’s role and sort of the overall role of virtual care in the senior population,” he told investors on last week’s earnings call.
In last month’s proposed physician payment rule, Medicare outlined new reimbursement for virtual visits. While that isn’t likely to be a significant tailwind for direct-to-consumer telehealth companies, Gorevic said the rule came “earlier than we anticipated,” adding that “it will provide more wind in the sails for our provider focus business where we provide platform as a service.”
A spending bill signed earlier this year added new flexibility for Medicare Advantage plans to build in telehealth coverage, which is the “traditional sweet spot of what we do,” Gorevic said.
The company could use the help. Its second-quarter earnings were a reflection of prior quarters, in which profits remained elusive. Year-over-year revenue grew 112% to $94.6 million as total visits grew 72%.
But the company still took a net loss of $25.1 million, up from $15.4 million in the second quarter last year.