The use of telehealth in U.S. healthcare has been accelerated due to the COVID-19 pandemic, according to Fitch Ratings. Providers and distributors will benefit from this trend because remote care services are assisting to effectively provide a revenue stop-gap in these times of social distancing and patient apprehension about entering the healthcare system.

Telehealth technology is providing revenue continuity whose ripple effects are felt in the supply chain as well, since doctors continue to prescribe medications.

Certainly, this is good news for hospitals and health systems. But this comes along with a caveat: The demand for telehealth solutions in the post pandemic times will depend on whether payers, which include Medicare and private insurers still continue to reimburse telehealth at current levels.

Presently, the reimbursement is much higher than in the past due to temporary waivers that might evaporate once this public health crisis ends.

According to Fitch, in-office visits are the primary delivery channel for U.S. healthcare. But the digital services are ensuring access to care and have kept the revenue flowing in part as it improves providers’ ability to bill for these services.

This has encouraged the federal government to start moving in the direction of driving lasting changes to the reimbursement picture, as per an executive order signed by President Trump. It would make some of the telehealth provisions permanent that have been enacted by the Centers for Medicare and Medicaid Services.

Healthcare providers have experienced an increase in demand for remote services in the second quarter of this year.

Telemedicine has been offsetting volume declines partially in varied pharmaceutical and medical distribution businesses, which are caused by fewer physician visits and pharmacy interactions.

A significant amount of capital is flowing into telehealth through M&A, due to the need for technology-based infrastructure to support virtual care services. After the pandemic, this trend can be mitigated by uncertainty around reimbursement, especially due to CMS seeking public input on the type of telehealth services to make permanent and the impending questions about the effectiveness of telehealth video visits as compared to in-person visits.

Fitch found that challenges still exist for providers, due to low volumes of elective patient procedures during the pandemic. But in the long-term, hospitals and health systems might attract and retain more patients with virtual care due to convenience.

One factor that could lead to telehealth platforms retaining their popularity is the preference they have been gaining from Americans over 50. Poll figures released last week reveal that one in four older Americans had a telehealth visit during the first three months of the public health crisis. This is a big leap from the previous year in which just four out of 100 people aged 50 or older had experienced such a visit.

Awareness about the special risks of COVID-19 among older adults might have played a significant role because 45% of respondents said that the pandemic had turned them to telehealth solutions.